Walmart’s bait and switch

January 25, 2018

Scratch the surface of Walmart's announcement that it's raising wages, and you'll find a lot more corporate greed than generosity, write Joe Andrews and Carlos Enriquez.

THOUSANDS OF Sam's Club employees showed up for work on January 11 only to find out their jobs no longer existed.

Walmart's decision to abruptly close 63 out of 660 Sam's Club locations across the country affects close to 10,000 workers.

Three of the store closures are in Puerto Rico, which will leave nearly 1,000 workers jobless as the island continues to face the devastation caused by two deadly hurricanes and a prior financial crisis.

In most instances, Sam's Club employees had no idea of the decision to shut their workplaces until they arrived for a shift that morning--and found locked-up stores with notices of closure posted on the doors.

In fact, at some locations, Walmart even had police officers turn away workers--not unusual for a company with a history of calling the cops on its own employees.

A few workers were "lucky" enough to be informed of the closures via letters sent out by the company.

"FedEx showed up at my door with a package from Sam's Club, and I was thinking that maybe it was my W-2," Nic Townsend, a Sam's Club employee in Sacramento, California, told Business Insider. "It was a letter saying they are closing down. I'm unsure of what to do. I have a baby and a mentally sick mother. I'm lost. I'm heartbroken. I'm scared."

A Walmart Sam's Club store in Maplewood, Missouri
A Walmart Sam's Club store in Maplewood, Missouri (Caldorwards4 | Wikimedia Commons)


THE SAME day that Sam's Club employees were slammed with this entirely unforeseen blow, Walmart grabbed headlines by announcing that, due to the recent Robin-Hood-in-reverse cuts in corporate taxes, employees would receive $1,000 bonuses and a new $11-an-hour starting wage. This supposedly shows that the Republican tax bill will benefit ordinary working-class Americans.

As thousands are forced into uncertainty due to the store closures, Walmart is patting itself on the back for breaking off a miniscule chunk of its massive corporate profits--made possible in part by the new tax scam that rips off all taxpayers--for its employees.

But Walmart isn't alone in congratulating itself. Shortly after the bonus and wage increase announcement, Trump patted himself on the back along with Walmart, tweeting that the wage announcement was: "Great news, as a result of our TAX CUT & JOBS ACT!"

Trump has been bragging about job growth since taking office, but according to NPR, employment increases were lower in 2017 than the year before.

Parroting the scammer-in-chief's remarks, House Speaker Paul Ryan also commended Republicans for making the lives of the middle class better through cutting taxes on the rich:

Today marks 20 days since the Tax Cut and Jobs Act became the law of the land. Already, this new law is helping to improve the lives of middle-income families across the country. You saw the announcement from Walmart just this morning: more than a million Americans are due to receive their bonuses because of tax reform.

Neither Ryan nor Trump--nor much of the media--mentioned the 10,000 pink slips at Sam's Club. It's pretty difficult to see how the thousands of working-class families who lost their jobs without notice and are now struggling to make ends will benefit from the Republican tax cuts.

That's not all that was left out of the news, either. One little-noticed fact about Walmart's wage announcement is that the full $1,000 bonuses are only going to employees who have been with the company for at least 20 years--and even then, workers aren't guaranteed the money.

If the bonuses were distributed equally to all 2.1 million Walmart employees--which they won't be--each person would each receive a pitiful $190.

Overall, the bonuses will cost the company about $400 million, according to analysts. That may seem significant, but it's pocket change to a company that reported pre-tax profits of $20.5 billion in 2017--and that is predicted to save $18 billion in taxes over the next 10 years, thanks to the tax-cut giveaway. The bonuses amount to roughly 2 percent of that 10-year bonanza.

Meanwhile, by cutting 10,000 Sam's Club jobs, Walmart will make back the $400 million in no time at all. Most Walmart and Sam's Club employees are part-time and make little, if any, more than minimum wage, which varies from state to state.

Even if the calculation uses a $15-an-hour minimum wage--a rarity that only exists in a few select cities--for Sam's Club workers averaging approximately 30 hours a week, Walmart would make its money back in less than two years.


WALMART'S ATTACKS on its workforce don't stop there.

In addition to the closing of more than 60 Sam's Club locations, Walmart announced that it also would be cutting 3,500 Walmart co-manager positions and adding 1,700 lower-paid assistant store managers to replace them.

The company then had the audacity to justify its actions by claiming this benefited customers: "Retail is changing rapidly, and we are transforming to meet the needs of our customers. To help compete and win in this environment, we must make changes across our company to enable further investments in our strategic business priorities and growth."

In other words, these decisions were made to further stuff the pockets of Walmart's board of directors and their stockholders.

With the widespread hatred of Trump and the Republicans and the unpopularity of the tax cuts, there's a certain logic to Walmart's attempt to sell its wage increase as proof that it cares about its employees.

But while Walmart might throw the occasional crumb to some employees, the company has no plan of paying the bulk of its low-wage workforce a living wage, or providing health benefits or any of the other things working people deserve.

As a company synonymous with corporate greed, Walmart's mistreatment of employees in the interests of investors and executives has been well documented. The corporate giant's history of wage theft hasn't just landed them in hot water with the press--it also led to warehouse workers walking off the job for a successful month-long strike to win back lost wages and challenge sweatshop conditions.

Additionally, the National Labor Relations Board recently filed a complaint against Walmart after the company "unlawfully threatened, disciplined, and/or terminated employees" for both "having engaged in legally protected strikes and protests" and "in anticipation of or in response to employees' other protected concerted activities."

Ultimately, Walmart was found guilty of abusing workers' rights, showing once again how the company actually treats its employees.


WALMART ISN'T the only company carrying out these sorts of attacks since the passage of the tax bill, of course. Comcast and AT&T laid off thousands of workers over the holiday season after announcing wage increases.

Even before the tax bill passed, Trump, the benevolent job saver, promised Indiana's Carrier Corporation $7 million in tax cuts if it agreed to keep facilities in the U.S. instead of moving to Mexico. But in January, the company announced it would be laying off hundreds of workers at the Indianapolis plant.

The narrative is a familiar one: the ruling class celebrates how well "trickle-down" economics works by announcing wage increases and bonuses, all while hypocritically slashing thousands of jobs.

Predictably, this brand of economics has never worked out for workers, because corporations pocket the profits and nothing trickles down to them. That's now blatantly apparent to Sam's Clubs workers and Carrier workers, among many others.

The elimination of 10,000 Sam's Club jobs while trying to publicize modest bonuses for a small percentage of the Walmart workforce isn't just a public relations bait and switch. It's part of a capitalist mentality of corporations stealing wealth from regular people, profiting from having corrupt politicians in their pockets, and making their own workers fight over crumbs.

With Trump's tax scam in place, the 1 Percent is feeling confident in its ability to steal even more from working people. Only an organized fight back by Walmart and other workers, along with the support of the public, can begin to stop these attacks.

Groups like OUR Walmart and Fight For 15 have already laid the groundwork for a movement that fights for fair labor conditions and a living wage for all workers. They have also shown the vital importance of organizing in the workplace by demonstrating to the bosses the real power that ordinary people hold when they are united.

Without the influence of these grassroots campaigns, even the window-dressing of Walmart's paltry wage increase would not have happened. Only by continuing and expanding these struggles can we hope to achieve a world in which workers aren't at the mercy of corporations like Walmart.

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