Walmart to End Sunday Pay Perk
Mike
Duke is a man concerned with
cutting costs. Walmart’s
CEO came into the
job a couple of years
ago pledging to find
ways to shrink the
company’s overhead and, true to his
word, the company has targeted Sunday
as a day it can save some money.
Walmart announced that all hourly
workers hired in the new year will
no longer be eligible to receive
an extra $1 an hour for working on
Sunday. Current workers will not
be affected.
Dorian Warren, an assistant professor of international and public
affairs at Columbia University, told Bloomberg News, "It amounts to
a huge wage cut. Wal-Mart has been underperforming financially relative to
its competitors and needs to find quick ways to shore up profits."
With high
turnover rates, Walmart’s move will certainly save it money, but the company
did not cite how much it expected to drop to the bottom line. One thing is
clear, the company does not believe it will negatively affect its store-level
recruiting efforts.
Greg Rossiter, a spokesperson for the chain, told Bloomberg,
"We regularly review our compensation programs and we are confident Wal-Mart’s
pay and benefits are as good if not better than other retailers."
Discussion Questions: Do you think Walmart’s plan to eliminate additional Sunday pay
will hurt the chain’s ability to recruit new workers? Are other large retail
chains doing the same thing?
This move by Walmart is one that most of their competitors cannot duplicate due to union contracts. Once again they have found a way to put pressure on their competition!
This move is perfect in this economy and in a high turnover industry where eventually most of Walmart’s workforce will not have premium pay for Sunday.
I didn’t even know they did this (bad on me, I guess). Hard to believe this is even necessary to provide in order to recruit or schedule staff. Might cause some short term pain for them (taking away $ is never easy), but this will soon be forgotten.
Sunday has lost much of its special meaning from a worker’s point of view. I remember “blue laws” that prevented much of retail being open on Sundays. If you were open it was often necessary to pay extra to be able to get people to work. Today most retail (with the exception of car dealerships and liquor stores in some states) are open on Sunday. Right or wrong, it has become just another workday for many people.
Walmart’s ability to recruit and schedule people for Sunday will be hurt in some markets and not in others. What will mitigate the impact is the economy. There is still about 10% unemployment and therefore many people who will be happy to have a job whether the is premium pay for Sunday or not.
It won’t hurt Walmart’s recruiting at all. Dozens, or hundreds, of workers apply for every position available in service industries. It’s still a very tough economy, especially for those on the lower-income level.
Walmart offers pay and benefits as good as any other low-cost retailer. One dollar an hour for a for a few hours on Sunday isn’t going to be noticed. What possible $8 a week loss is going to make or break a recuit’s decision? Even less when you consider taxes. This is hardly even newsworthy.
I am sure glad I am not the labor negotiator for a Walmart competitor.
As stated by others, this is a great move at the perfect time. Dollars saved will go directly to the bottom line and in a slow economy I don’t think it will affect hiring. The only negative might show up in staff attendance, but I don’t believe that a conscientious employee will treat their Sunday obligation any differently than another day. If they are someone who is an attendance problem it will show up on other days too.
Another positive to this whole thing, although you have to be careful how you spend your savings, is that there is potential for increased sales on Sunday because of reduced out-of-stocks at the shelf. If the usual policy had been to under staff on Sundays, it might be that sales will improve.
I guess the bigger question here is whether there are other areas where Walmart might seek similar advantages? Should the night crew get premium pay? Do holidays still deserve special pay?
I go back to my opening sentence….
A very smart move by Walmart that as has been pointed out takes advantage of their not being union. I don’t expect that this will cause any problems for them at all except for a little complaining at first.
From what this article stated, current employees will continue to receive the additional $1 on Sundays. A new hire will most likely not even have been aware that a change took place.
Kmart made this change years ago without a negative impact on hiring of new employees. The biggest impact from this change was the change in scheduling. Employees receiving the additional $1 for Sundays found they were no longer scheduled to work on that day.
This will have no effect on their ability to staff on Sunday. 1. They are not going to cut the pay of those people who are already on the payroll. Store managers may look at working more new employees on Sunday rather than the higher priced long term employees. 2. With unemployment at over 12% for the employees that Walmart hires for these positions there should be no problem in finding plenty of applicants. 3. Walmart is more than competitive with most of the other businesses they compete with for employees. (Note I did not say retailers because they compete with a lot of different employers for frontline workers) 4. If they do find a tough market for attracting the people they want to hire they have the ability to raise wages in those markets. (They don’t pay the same rate in all markets now.)
I’m sure the union organizers will try to use this to stir support within the work force, but it won’t matter since Walmart smartly only applied this to new hires. This will have zero impact on their ability to recruit weekend staff.
Pulling the $1 hourly Sunday perk won’t affect Walmart’s ability to recruit. There are armies of new and old Americans waiting for a chance to work at Walmart. But it does indicate that WM could be feeling a pinch. Their competitors are mostly union and are strapped with less freedom to cut contracted wages. That gives a temporary advantage to WM.
Now look into your crystal ball. Someday, when/if the bird of happiness and economic prosperity return to the marketplace, Walmart could experience more trouble hiring Sunday workers at $1 an hour less. It seems that could be some competitor’s target.
Makes me wonder: Will the labor cost savings be sufficient to fund Walmart’s legal expenses in the latest class action gender discrimination suit?
“Current workers not affected.” Smart move. That will quell dissent. My guess is that few retailers offer a bonus for Sunday work hours so Walmart is not likely to be at a worker recruitment disadvantage even if and when the surplus of available workers abates. When I think about it, paying extra for Sunday might be discriminatory–actually favors someone whose day of worship is other than Sunday. How? They can take that day off and then get extra for working Sunday.
As many…most…practically everyone has noted, this will have little effect on hiring (especially in today’s labor market), but will likely make the WM haters hate even more (it’s also a reminder that without minimum wage laws, they would likely be doing the wage limbo dance right now, and assuring us that with their low prices that $0.53/hr is “the best in the industry”).
The times they are a changing!
I remember on Sunday in the early fifties as we drove by a new discount store on the way to dinner after church my Grandfather said the only spiteful words he ever uttered in front of me. He said “They are open Sunday, somebody should throw a stink bomb in there.”
By the late 60s many grocery stores were paying time and a half for Sunday work. Now it’s just another day. One day like all the rest.
Typically canny of Walmart to take advantage of people desperate for work. I’m sure there will be no problem recruiting.
It will have no effect on recruiting new workers. It will have no effect on turnover.
It would be interesting to know what other ‘large’ retailers are actually doing, if anything at all.
If you are a non-union retail worker, any benefit for Sunday or other premium days is already gone and has been gone for a long time.
Walmart is just bringing their already low wage structure even lower. It’s doing it likely as an offset to rising costs of everything including the mandates of nationalized health care. Interestingly enough, I am very surprised that they have not received a waiver on the nationalized mandates as some other retailers and major unions have that supported the efforts. Other retailers such as Meijer and Ingles Markets are on a list published today receiving such a waiver. Maybe they will be able to hold off for a year on any cuts on Sunday if they have them.
While I do not think cutting the Sunday pay perk will adversely affect Walmart vs. their competitors or the ability to recruit employees; I do think Walmart needs to find a PR way not to continue shooting themselves in the foot.
Enough of this negative publicity from the Class Action Suit brought by the female employees to what is going to be perceived as a pay cut. It is time for Walmart to put themselves on the front page of the business section with their yellow smiley face news.
Welcome to the 21st Century! Walmart is finally managing its workforce as it should. Antiquated Sunday pay is not necessary in a retail workforce, and has not been needed since Sam was around. We have a large part time workforce who will gladly work, and accept standard pay just to enjoy that privilege of working…the youth and elderly, and they work retail on a regular basis. It is great that Walmart is opening up more opportunities for these people by eliminating “Sunday pay premiums.”