February, 2005

Wal-Mart on the Run from Its Record

Wal-Mart used children for hazardous jobs in its U.S. stores according to a U.S. Labor Department investigation as reported in the New York Times on February 12, 2005. Wal-Mart is being sued for sexual harassment in Florida by the federal government as reported in the Bradenton Herald on February 18, 2005. Wal-Mart was cited in Alabama for having the most employees on taxpayer-funded Medicaid health program as reported in the Associated Press on February 22, 2005. Wal-Mart is the target of a Georgia legislative initiative on companies with large number of employees receiving taxpayer-funded health care after it was revealed the retail giant ranked number one for employees on the government health program as reported in the Atlanta Journal-Constitution on February 23, 2005.

In a ten-day period, Wal-Mart compiled a virtually unmatched public record of abusive, illegal and irresponsible conduct involving women, children and taxpayers. These most recent reports come on top of Wal-Mart already facing the largest sex discrimination lawsuit in history, court convictions for forcing employees to work without pay, and government complaints for the illegal firing and intimidation of workers for exercising workplace rights. In Canada, Wal-Mart is closing a store and taking away the livelihoods of almost 200 workers rather than comply with the law providing a fair and impartial process to reach a contract with workers.

So what does Wal-Mart CEO Lee Scott do?  He delivers a speech attacking the United Food and Commercial Workers International Union (UFCW).

In his speech delivered in Los Angeles yesterday, Scott glibly ignored the company’s very public record of shameful conduct; blamed the UFCW and other critics (the “guppies” according an earlier Scott pronouncement) for his problems; and, created an alternative reality where low wages, unaffordable benefits, the massive export of U.S. jobs to overseas sweatshops, the suppression of worker rights and taxpayer subsidies for the giant retailer have somehow made the world a better place.

The Scott speech continues a public relations offensive launched several weeks ago to prop up the company’s sagging image, pump up stagnate stock prices, and sidestep holiday season reports that competitors from Sears to Best Buy offered lower prices. The speech contains the same willful distortions and Orwellian double-talk as the company’s ad campaign. Repeating a lie does not make it true.

Scott brags, as did the ads, about the number of full-time employees– except full time in Wal-Mart speak is about 30 hours a week, not 40 hours as in the rest of reality. Scott proudly proclaims that Wal-Mart’s average wages are about twice the minimum wage. He ignores that Wal-Mart uses its enormous political clout– the largest political giver in 2004– to keep the minimum wage in real terms at its lowest level in decades.  Even at the supposed Wal-Mart average wage, a family with a Wal-Mart income is still left scraping the poverty line. Scott cites Wal-Mart health insurance as a positive, but fails to mention that 700,000 Wal-Mart associates do not have the company’s health insurance, and that those who do, pay more on average than employees of other major companies.

In instance after instance, Scott contorts the facts to serve his own purposes. He cites the lack of opposition to his company in communities across California, and declares opposition to Wal-Mart is limited to urbanized areas– except the overwhelming majority of Californians live in those urbanized areas. He talks about company tax payments, but doesn’t mention the tax costs the retailer imposes on states and communities with its low wages and lack of affordable health benefits.

Despite Scott’s protestations, Wal-Mart is not just a simple retailer. Wal-Mart is the largest single economic force in history. It is the largest private employer in the country, and the largest corporation in the world. Walton family members comprise five of the ten richest people in the world. About one percent of the wealth of just one of the Walton richest five would provide affordable health insurance for all Wal-Mart workers in the U.S.  Wal-Mart is about high profits, not low prices.

The United Food and Commercial Workers International Union has 1.4 million members working in neighborhood supermarkets, retail stores, meat packing and food processing plants. UFCW retail members work for major retailers such as Kroger, Safeway and Albertsons.

Grocery Workers To Vote On Vastly Improved Settlement

Washington DC—Denver-area UFCW members working at Kroger operated King Soopers supermarkets will be voting over the next few weeks on a settlement designed by a federal mediator.

The UFCW International Union intervened to discontinue voting last November on a company contract offer that would have jeopardized health care coverage not only for Denver-area UFCW members but also members across the country. After a subsequent negotiating session ended in no movement toward a settlement, the company requested that the Federal Mediation and Conciliation Service design a projected agreement based on bargaining documentation submitted by both the union and the company. When UFCW members serving on the bargaining committee representing King Soopers’ workers agreed to the process, the mediation service took up the task of putting a settlement together.

“The projected agreement ensures affordable health care for UFCW members and is in line with other agreements recently ratified in Seattle, Northern California, and Las Vegas,” said UFCW International President Joe Hansen. “It’s definitely a major improvement over the company’s offer last year.”

The settlement option preserves affordable family health care. Under the projected agreement, UFCW members will have a $5 to $15 weekly premium co-pay, depending on the type of  coverage.  The company’s original offer would have destroyed the grocery workers’ health and welfare fund and eliminated any meaningful family coverage.

The agreement option also secures the workers’ pension fund, requiring increases in the company’s pension contributions, and provides real wage increases, as well as bonuses. There is no two-tier wage or health care benefit provision in the contract, although new workers will have to wait longer to achieve the full wage and benefit package.

“The last two years at the negotiating table have been extremely contentious, especially on the health care issue,” Hansen pointed out. “Denver negotiations haven’t been any different. I think the mediator’s crafted settlement allows UFCW members working at King Soopers to provide financial and health care security for their families.”

Stop Child Labor At Wal-Mart

Food and Commercial Workers Union and Child Labor Coalition Present Proposal to Immediately Stop the Use of Children in Hazardous Jobs at Nation’s Largest Employer

Wal-Mart could stop illegal child labor in its stores through distinctive employee badges for underage workers that could readily identify them as being prohibited from hazardous assignments, according the United Food and Commercial Workers Union and the Child Labor Coalition. Combined with unannounced Labor Department inspections, the use of children for hazardous jobs would come to a rapid halt.

The two organizations are sponsoring, at www.ufcw.org, an e-mail campaign directed at Wal-Mart CEO Lee Scott and U.S. Labor Secretary Elaine Chao asking them to abandon a sweetheart deal on child labor announced earlier this week, and to take meaningful action to end the abuse of young workers.

Key to the union/coalition proposal is the re-badging of underage workers. Both managers and young workers would always be aware that certain assignments are illegal. Compliance would require unannounced inspections to make sure that badges are properly issued, and that no manager is pressuring minors into illegal assignments.

Scott and Chao are being presented with a demand to amend a settlement agreement that required the Labor Department to give Wal-Mart an unprecedented 15 days notice before any inspection. Advanced notice clearly undermines compliance, and allows managers simply to re-assign underage workers before an inspection.

Hundreds of children are maimed and crippled in accidents, some losing arms and legs, every year involving balers and compactors commonly used in Wal-Mart and other retail stores to handle the disposal of boxes and similar materials. The law has long prohibited minors from operating this kind of machinery. A Labor Department investigation brought allegations that Wal-Mart was using illegal child labor to operate the hazardous equipment in several states. To settle the case, Wal-Mart paid $135,000 and the Labor Department agreed to advance notice of inspections.

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The UFCW and Child Labor Coalition’s actions today are supported by leading worker advocates in the U.S. Congress, including Representative George Miller (D-Calif.) and Senator Edward M. Kennedy (D-Mass.). Their statements follow:

Statement of Representative George Miller (D-Calif.), Senior Democrat on the House Committee on Education and the Workforce

I congratulate UFCW and the Child Labor Coalition for proposing a workable, inexpensive and effective way to end the illegal use of child labor, and I would hope that both Wal-Mart and the Department of Labor will respond positively.

Statement of Senator Edward M. Kennedy (D-Mass.) on Wal-Mart’s Sweetheart Deal with Department of Labor on Child Labor Violations

The Department of Labor has shamefully abdicated its responsibility by acquiescing in Wal-Mart’s continuing violation of child labor laws and other worker protections. Even worse, the Department conspired with Wal-Mart to conceal this sweetheart deal from the public. The Department is there to enforce the law, not be muzzled by America’s largest employer.