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[9 comments]

Walmart pledges to support farm worker wages

January 17, 2014

Walmart is about to make the lives of 30,000 farm workers picking tomatoes in Florida just a little bit better. Yesterday, the world's largest retailer signed on to the Fair Food Program created by the Coalition of Immokalee Workers (CIW) that will pay the workers an additional penny per pound for tomatoes. Those same workers currently earn around a penny and a half for every pound of tomatoes they collect. Tomatoes are a $650 million a year business in Florida.

As part of the agreement, Walmart has also pledged to work with the CIW to expand the program for tomato workers outside of Florida and to other crops. The retailer plans to reward suppliers that participate in the Fair Food Program and work with them to build the penny premium directly into its costs.

"We are truly pleased to welcome Walmart into the Fair Food Program. No other company has the market strength and consumer reach that Walmart has," said Cruz Salucio of the CIW, in a statement. "Through this collaboration, not only will thousands of hard-working farm workers see concrete improvements to their lives, but millions of consumers will learn about the Fair Food Program and of a better way to buy fruits and vegetables grown and harvested here in the U.S."

"Walmart and our suppliers are committed to strong ethical sourcing standards and every day we work to help ensure the products we sell are produced in a way that provides fair treatment for workers in our supply chain," said Tom Leech, senior vice president of global food sourcing for Walmart. "Our participation in the Fair Food Program combined with long term supply agreements with our suppliers will ensure that our customers get great products at great prices from suppliers that are working to improve the lives of their workers."

Walmart is likely enjoying the favorable response it is getting from this latest action. The retailer is frequently the target of criticism by labor groups that say it is profiting from the low wages it pays employees.

The National Labor Relations Board (NLB) filed a complaint against the company this week alleging it violated the rights of employees around work stoppages at Walmart stores in 13 states.

According to the NLRB, the National Labor Relations Act guarantees that workers in the private sector may "act together to try to improve their wages and working conditions with or without a union." The NLRB complaint alleges more than 60 employees were disciplined, including 19 who were fired, for engaging in activities protected by law.

Walmart is disputing the NLRB's charges.

"We now have the opportunity to present the facts of these cases in front of a judge," Brooke Buchanan, a Walmart spokesperson told the Associated Press. "No reasonable person thinks it's ok for people to come and go from their scheduled shift without being held accountable."

FINANCIALS:     [NYSE:WMT] [ ]

Discussion Questions:

What are the implications of Walmart's agreement with the Coalition of Immokalee Workers? Will this action improve the perception of Walmart's labor record?

While we value unfettered opinion, we urge you to show respect and courtesy for people or companies about whom you comment. Keep in mind that this is a public, professional business discussion. RetailWire reserves the right to edit or refuse the publication of remarks that we deem unsuitable. We may also correct for unintended spelling and grammatical errors.

Instant Poll:

How likely are other retailers buying tomatoes to sign on to the Coalition of Immokalee Workers Fair Food Program as a result of Walmart's action?

Comments:

Walmart has a knack for doing little things that generate good PR. This is one of them. This action does not cost the company a lot of money and shows concern for farm workers.

That said, this does little to allay the overall perception of Walmart's labor record. With Washington focusing on the disparity between rich and poor, and President Obama due to highlight this topic in his state of the union address, companies like Walmart and McDonald's are in for a rough ride.

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Max Goldberg, President, Max Goldberg & Associates

When it comes to Walmart, look for them to find some good alternative reason for signing this agreement other than improving their perception. This might also raise the price of tomatoes for their competitors as well. Competitors may not be able to make up the price increase because they don't have Walmart's volume. This could put more stress on some already struggling competitors. Competitors that don't sign on, Walmart will call them out as being anti-worker.

In the end this could be more about Walmart controlling the tomato market and making life for difficult for the competition.

David Livingston, Principal, DJL Research

 
12

Walmart creates news because they can. Nothing like some free publicity that is timely, and tugs at your heart strings, which is what they know how to do.

Nothing wrong with what they are doing, but I just hope their motive was genuine concern, rather than a way to have bloggers talk about them once again.

Okay, I admit I'm skeptical, but it's Friday, and makes some positive weekend news.

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Tony Orlando, Owner, Tony O's Supermarket & Catering

I'd like to know more about the incremental improvement in take home pay for the workers. I agree the percentage increase is high, but what does it do for the life of the worker? Or was I supposed to know this?

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Joan Treistman, President, The Treistman Group LLC

Hopefully, Walmart isn't doing this just for the sake of public perception, but rather, because it's the fair and just thing to do.

Definitely a step in the right direction.

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Eric Chester, Keynote Speaker, Author, Reviving Work Ethic, LLC

A whole penny! They only have to pick a ton to get an extra $20. I hope that doesn't bankrupt Walmart.

'txfood'

Mostly what I take away from this is, regardless of the specifics of the program - whether it is wonderful, or a cynical, even diabolical, effort to gain favor - Walmart enjoys an (almost) unparalleled ability to create publicity. (Not in the leagues of Apple or Amazon, of course, but we're talking mortals here)...if Tony (Orlando) offered to pay even a whole dollar more per pound, how much attention would it generate outside his hometown? (Not to mention the lack of buying power to try it.)

'notcom'

The heck with perception. By virtue of its sheer scale and economic and social footprint, Walmart bears an absolute responsibility to take the lead in sourcing practices like the Fair Food Program.

The Coalition of Immokalee Workers seems elated about the agreement with Walmart, and this seems like a positive story on its face. Like some others in this forum, however, I'm having trouble seeing how a penny-a-pound increment can change workers' lives in a meaningful way. I guess if you pick 100 pounds an hour, that would add a dollar to your wage....

In no way does this tomato gesture whitewash (redwash?) the issues Walmart faces with respect to its internal labor practices. As a the nation's largest private employer by a mile, with a record of steadfastly resisting unionization, it should expect scrutiny from the NLRB and behave accordingly. Fair treatment of 2.1 million employees will feed back positively to the consumer economy and to the retailer's own fortunes.

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James Tenser, Principal, VSN Strategies

You can be assured that Walmart does absolutely nothing out of concern or sympathy. This was entirely a business move. Exactly how it will benefit Walmart's bottom line may not be apparent on the surface, but it will do so in some way. It may be simple PR, it may be a way to get an edge on the competition, or it may be a tax write-off. It may even be just a step on the ladder to something else. But it is decidedly not from any altruism on Walmart's part.

Sally Beckner, Owner, Sunflower Sally Used and Rare Books

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