Author's Note: Funny you should run an article on how fucked up Wal-Mart (from Cycle Source Magazine) is treating its potential suppliers, trying to come off as some holier-than-thou corporation saving us from ourselves by keeping objectionable material off its magazine and music racks. I am enrolled in a business ethics class through my local college and I recently completed a case study on Wal-Mart. All of the information I presented is available on-line or is straight out of the textbook
–Bikernet member “Bull”
All information cited from my business ethics college textbook, which itself is probably UNETHICAL, but I don’t really give a fuck, our people really need to know the shit wally-world is pulling on us.
Business Ethics: Ethical Decision Making and Cases (2008) Seventh Edition, by Ferrell, O.C., Fraedrich, J., and Ferrell, L. Boston, Houghton Miffin.
In 2005, an internal document made public by Wal-Mart Watch showed that 46% of Wal-Mart employee’s children were on Medicaid or uninsured. An economist at the Air Force Institute of Technology found that Wal-Mart increased Medicaid costs an average of $1898 per worker.
Wal-Mart accounts for 10% of the U.S. trade deficit with China, or about $18 billion per year. That is money being taken out of American workers pockets in the interest of lower prices for the consumer.
Companies such as Master lock, Fruit of the Loom, Levi’s and Rubbermaid have all moved production overseas due to pressure from Wal-Mart to reduce prices.
The U.S. Equal Employment Opportunity Commission (EEOC) has filed 15 lawsuits against Wal-Mart since 1994. Of these, 10 are still pending and five have been resolved.
Although women account for more than 67% of Wal-Mart employees, women make up less than 10% of upper-level management. In 2001, a Wal-Mart executive conducted an internal study that showed the company paid female managers less than men in the same position.
In October 2003, federal officials raided Wal-Mart stores across the U.S. and arrested 250 illegal immigrants working on cleaning crews at 61 stores in 21 states. According to a Wall Street Journal article in November 2005, the three top Wal-Mart executives knew about the illegal immigrants and allegedly encouraged the development of shell companies to continue operations if one of the companies got shut down for using illegals. Even after agreeing to make sure no people working for Wal-Mart were illegal immigrants, another raid in November 2005 netted 125 illegal immigrants at a 1 million square foot distribution center construction site in eastern Pennsylvania. In December 2005, another 14 illegals were arrested at a Wal-Mart distribution center in Nebraska.
To work full-time at Wal-Mart, an employee is guaranteed only 28 hours a week, creating a catch-22 where the employee is not eligible for unemployment benefits, but does not make enough to cover living expenses. This means the taxpayer makes up the difference, to the tune of $420,750 per year PER STORE! Or about $2103 per Wal-Mart employee. This money goes to cover reduced or free school lunches for Wal-Mart employee’s children, housing assistance, federal tax credits and low income electric and gas bill assistance.
Wal-Mart fails to provide health insurance to more than 60% of its employees. Part-time employees are excluded from the program and the company has an extra-long waiting period before full-timers become eligible. In a leaked memo to the board of directors, Susan Chambers, Wal-Mart executive vice-president for benefits, described how 46% of Wal-mart employees are uninsured or on Medicaid. The memo detailed how Wal-Marts health plan requires such high out-of-pocket payments that an employee hit with a high cost illness “almost certainly ends up declaring personal bankruptcy.” The memo also proposed Wal-Mart rewrite job descriptions to involve more physical activity to “dissuade unhealthy people from coming to work at Wal-Mart.”
In December 2005, Wal-Mart paid $172 million to more than 100,000 California workers for routinely denying meal breaks, rest breaks, altering time cards and deleting hours from timecards. Employees were reprimanded for claiming overtime. Another similar case in Colorado and New Mexico ended in 2000 with Wal-Mart paying $50 million to 67,000 employees.
In a Wal-Mart store in Loveland, Colorado, some employees in the tie & lube express wanted to unionize. Wal-Mart found ways, according to some workers, to pressure the few pro-union workers by hiring more workers into the tire & lube express in order to dilute the numbers who would vote for the union. In 2000 when seven of ten butchers in a store in Jacksonville, Texas voted to join the United Food Workers Union, Wal-Mart responded by announcing that henceforth it would sell only precut meat in all of its supercenters, fired four of the union supporters, and transferred the rest to other divisions. In Jonquire, Quebec, Canada, the United Food and Commercial Workers organized at a Wal-Mart store in 2004. In 2005, Wal-Mart closed the store, claiming it was losing money and that union demands were a divisive force.
In January 2005, Thomas Coughlin resigned as Vice-chairman of Wal-Mart, but remained on the board of directors. His 2004 compensation was over $6 million. In March 2005, he was forced to resign for stealing $500,000 through false expense accounts, unauthorized gift cards, hunting vacations, a $2590 dog enclosure at his home and a $1359 pair of handmade alligator boots. In January 2006, Coughlin pled guilty to federal wire-fraud and tax evasion charges. Coughlin claimed a $2,000 expense, explaining to the board of directors he was using the money for anti-union activities, including paying union staffers to identify pro-union workers in Wal-Mart stores. This activity is a criminal offense under the Taft-Hartley act. Coughlin faced up to 28 years in prison, but was ultimately sentenced to 27 months of home detention.
The construction of a Wal-Mart supercenter stresses the infrastructure of roads, parking and traffic flow while lowering average community wages by 5%, making it even harder for the city to recoup damages through taxes. There are over 26 million square feet of empty Wal-Mart stores or about 350-400 stores nationwide as they grow from a standard store to a supercenter. Wal-Mart goes out of its way to prevent competing stores (such as Target) from moving into these empty stores.
The EPA and the states of Tennessee and Utah allege Wal-Mart violated EPA regulations at construction sites around the country – Wal-Mart settled for $3.1 million.
In 2001-2003 Connecticut filed suits against Wal-Mart for violation of state environmental laws – Wal-Mart settled for $1.5 million.The EPA and Massachusetts allege Wal-Mart violated air-quality restrictions- Wal-Mart settled for $150,000.
District attorneys for Solano County and Orange County, California allege Wal-Mart in Vacaville of illegal hazardous waste handling during disposal of fertilizers and pesticides on April 3, 2002 and January 24, 2004. These cases have not yet been settled.
