Walmart balances motivation across pay levels
Walmart is looking to motivate new associates with faster pay hikes while placating senior workers bothered by the steady wage upgrades for newcomers.
As first reported by The Wall Street Journal, new employees now need only three months of training to see their pay hiked to $10.00 an hour from $9.00. Previously, the “Pathways” training program lasted six months.
A number of “listen sessions” with associates last year indicated the faster promotion was needed to help new associates stay engaged and “feel more confident in job skills,” according to the report. Beginner associates will also begin training with managers on the selling floor more quickly than before.
In April 2015, Walmart raised entry-level pay to $9.00 — a 24 percent increase from the U.S. minimum wage — with a stated goal of raising customer service levels. Newly hired managers, who previously started at $13 an hour, began receiving $15. The higher entry-level pay structure came amid a tightening labor pool.
Walmart’s improving results in the U.S. over the last two years have been traced at least in part to improving customer satisfaction scores.
At the upper end, Walmart employees hired on or before Oct. 31, 2016 will receive a two percent raise on Feb. 18, while long-term employees who have reached the maximum level of pay grades will receive a onetime lump sum of two percent of their annual pay.
The pay incentives for senior workers come as some have grumbled that the pay hikes have been largely reserved for new employees. Judith McKenna, chief operating officer of Walmart U.S., told the Journal, “I think it’s going to be an inevitability of businesses.”
A Bloomberg article from 2015 initially detailed how hundreds of comments on Walmart’s Facebook page showed senior workers were upset that less than half the workforce would be getting raises.
According to the Bloomberg and Journal articles, Walmart has been working to appease senior workers by giving them more desirable hours, more paid time off and offering training programs to help them advance their careers.
- Wal-Mart to Adjust Policies on Employee Pay Increases – The Wall Street Journal
- Wal-Mart Third Quarter 2016 Results – Wal-Mart Stores
- Wan-Mart Third Quarter 2016 Conference Call – Wal-Mart Stores
- Wal-Mart is making it easier for workers to earn those pay hikes – CNBC
DISCUSSION QUESTIONS: Do you think it is more important for Walmart to hike wages for entry-level workers versus senior staff? How should Walmart handle any resentments from longtime workers?