Stakes Could Not Be Higher for Wal-Mart Strikers

The company is the country's largest private-sector employer and has forced unionized retailers to lower their wages.

On Black Friday, one of the busiest shopping days of the year, Wal-Mart workers across the country will strike for “consistent hours, better pay, and simple respect.” It’s an unprecedented action in the fifty-year history of the country’s largest private-sector employer.

In response, the company, which has repeatedly violated its employees’ labor rights over the past two decades, has filed charges against the United Food and Commercial Workers (UFCW) with the National Labor Relations Board. A clear indication of the company’s concern about Friday’s strike — the latest in a series of worker protests dating back to late September — the action has been widely viewed as Wal-Mart’s warning shot to its employees. Senior executives in Bentonville, Arkansas insist that the company offers competitive wages and attractive opportunities for advancement, and that the protests are simply the actions of a few disgruntled employees, spurred on by the UFCW.

But the company’s mask is slipping when it comes to pay and advancement. Last week, journalists obtained a copy of Wal-Mart’s “Field Non-Exempt Associate Pay Plan” for 2013. The “Pay Plan” is one of the first internal documents made public that clearly contradicts Wal-Mart’s misinformation on compensation: It details the company’s rigid pay structure for hourly employees and makes clear why it is so difficult for associates to earn more than poverty-level wages. Despite what company executives claim about paying competitive wages, the reality is that almost half of Wal-Mart’s associates make less than $10 an hour, with many of them relying on public assistance to help support their families. Average Wal-Mart employees make just $8.81 per hour, and those associates who make more than $10 an hour have often worked for the retail giant for a decade or longer.

The protesting workers want more full-time jobs — Wal-Mart keeps many workers who want full-time work on part-time schedules, and restricts health benefits for employees working less than 24 hours per week — and an end to management retaliation for trying to form a union. They also want the company to pay at least $13 per hour and expand access to healthcare. But they are a long way from achieving these basic demands. Despite forecasting $13.5 billion in capital expenditures, the company plans to increase the costs of its employees’ health premiums by up to one third in 2013.

The stakes in the Wal-Mart campaign could not be higher. Wal-Mart is not only the country’s largest private-sector employer, with more than 1.4 million employees and 4,500 stores nationwide, it is also the country’s largest private-sector employer of women, African Americans, and Latinos. And it is the employer with the nation’s largest number of employees reliant on government assistance, with a cost to taxpayers in the hundreds of millions of dollars.

Retail is tremendously important to the US and California economies, but Wal-Mart’s shadow looms large over the sector. Fifteen million Americans work in retail, with most retail employees earning around $21,000 per year. Unionized jobs in the sector enjoy better wages and benefits, but that difference has shrunk significantly in recent years as a result of the pressures of non-union competition. When unions were stronger in the private sector, the “union spillover effect” raised wages and benefits in the non-union retail sector. Not any longer. Wal-Mart now exercises such great influence that the spillover effect works in the opposite direction: Unionized retail companies have pushed to lower wages and benefits in order to compete with the non-union giant.

A strike at Raley’s grocery chain in early November involving 7,000 employees in Northern and Central California clearly demonstrated the impact of low-wage non-union competition. The immediate cause of the 9-day strike, which was the first in the company’s 77-year history, was Raley’s demands for drastic cost savings because of pressure from non-union competitors. This pattern is increasingly the norm in the retail sector in California. In early September, 11,000 Save Mart workers in Northern and Central California accepted sweeping concessions demanded by the struggling supermarket chain. Only 5.4 percent of the retail sector is now unionized nationwide, with Wal-Mart having forced several unionized retailers out of business and caused many others to drive down wages and benefits.

If private-sector unionism and decent service jobs are to have any future, employees at Wal-Mart must be able to exercise their choice to form a union. As the respected international organization Human Rights Watch concluded in its scathing indictment of Wal-Mart’s labor practices in 2007: “The future of workers’ right to freedom of association is at stake when the world’s largest company can regularly violate this fundamental right with virtual impunity in the world’s largest economy.”

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