Will Walmart Hike of Entry-Level Pay Be a Retail Game Changer?

ALWAYS LOW WAGES? Maybe not: Walmart announces a wage hike on Feb. 19.

Walmart reported on Feb. 19 that it would increase wages and establish more predictable work schedules for employees. New employees will receive a minimum wage of $9 an hour beginning in April 2015 and $10 starting in 2016.

In a letter to Walmart “associates,” Walmart’s chief executive officer and president, Doug McMillon, explained the new policy: “We’re always trying to do the right thing and build a stronger business.

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“We frequently get it right but sometimes we don’t. When we don’t, we adjust,” he said. “When we take a step back, it’s clear to me that one of our highest priorities must be to invest more in our people this year.”

Business analysts say the retail giant’s wage decision is being driven by pressure from other large retailers like the Gap, which similarly adjusted its pay scale upward last year. The new wage schedule should help with employee retention and would allow the company to unify wage standards that have become complicated by successful local and statewide campaigns to raise minimum wages around the country.

In a statement to the press, Emily Wells, an organizer with the worker-advocates group OUR Walmart, said, “The company is addressing the very issues that we have been raising about the low pay and erratic scheduling.” Wells added, however, that “this announcement still falls short of what American workers need to support our families.” She argues that Walmart can do much more. “With $16 billion in profits and $150 billion in wealth for the owners, Walmart can afford to provide the good jobs that Americans need—and that means $15 an hour, full-time, consistent hours and respect for our hard work.”

The Rev. Sinclair Oubre of the Catholic Labor Network cautioned that the Walmart decision still leaves much room for improvement, and not just on wages. He pointed out that the higher wage remains far from a genuine living wage for the many retail workers with families to support.

“Anything that helps workers move closer to a living wage,” said Father Oubre, “we would support.” Though the Walmart minimum is now about 25 percent above the federal minimum wage and about 50 cents to a dollar more per hour than its entry-level workers had been receiving, the increase falls far short of the $15 an hour currently sought by labor activists in the retail and fast-food industries.

Beyond the relatively minimal impact on what Catholic social teaching suggests should be a just wage for workers, Father Oubre points out that the Walmart move does not increase the chances that its superstores will become more welcoming of union organizing efforts. Walmart has been notoriously aggressive in efforts to keep unions out of its stores.

“As Catholics, what cannot be lost in this discussion is that for 120 years our church has insisted that it is a natural right of workers to join together in associations [that allow workers to engage] in collective bargaining,” he said. Catholic consumers, Father Oubre said, should treat with concern “retail or even ecclesial institutions which believe they do not need to have collective bargaining because they know what workers need and don’t let workers articulate what those needs are themselves.” He said such paternalism undercuts workers’ human dignity.

“Walmart could pay $20 an hour,” Father Oubre added, “but there would still be a justice issue here because of the natural right of workers to join in associations and represent themselves continues to be virulently denied.”

The Walmart move should put pressure on other low-paying retailers to follow suit. Because of Walmart’s mammoth scale—it employs more than 1.4 million people at its hundreds of locations in the United States—it essentially establishes wage and benefit policy for the entire retail sector. For good or ill, Walmart can call the tune.

“This very positive action should not distract [U.S. Catholics] from the larger goal, which is two-fold,” Father Oubre said. “Employers have a responsibility to pay a living wage to employees, and we as consumers have a responsibility to be willing to pay a premium so that our fellow workers have a just wage.”

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Ernest Martinson
3 years 7 months ago
I agree with Catholic Labor Network that Walmart could pay more. One means of allowing Walmart to pay more would be for the government to end the theft by taxation of Walmart profits. Unfortunately, as employees are then paid more, government will still pillage the pay through payroll and income taxes. As for church teaching that it is a natural right for workers to join together in associations, it is also government teaching that citizens have the right to join in free association. But collective bargaining that entails the use of force within the workplace against the employer and dissenting workers does not sound like free association to me. Perhaps the church would see the light if it allowed collective bargaining of unionized priests to bring bishops to bay.

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