Wal-Mart in the News — A Lot! (Part II)

Last week, at a St. Louis bloggers’ lunch, Dennis Kennedy and I were joking about all our uncompleted posts, and all my Part I’s that never got Part II’s.

Back in November 2005, when I wrote Wal-Mart in the News — A Lot! I meant for that post to be Part I of a series, and actually had Part II started, but . . . .

Wal-Mart is of interest to observers of HR, employee benefits, unions, and employment law for several reasons, not least being that it is the nation’s largest employer and perhaps the labor movement’s biggest — and current favorite — corporate villain. See box at beginning of previous Wal-Mart post.

Now, months later, I’m purging my accumulated Wal-Mart file, and presenting my Wal-Mart news accumulated since November, in reverse chron. order, more or less.

Here are the main topics:

• Fast Company blog features Wal-Mart stories all week
• Wal-Mart doubles organic food offerings
• Wal-Mart fights back against union tactics with its own thinly disguised propaganda machine
• Maryland passes mandatory health insurance bill affecting only Wal-Mart
• More on existing Wal-Mart health care plan
• Sharp critique of the sex discrimination class action
• The choice consumers face: a stiff price for made in USA

Fast Company blog

All week, The Fast Company blog features Wal-Mart stories by by senior writer Charles Fishman, author of a bestselling book about Wal-Mart, The Wal-Mart Effect.

Start with this from Monday March 5: “The Wal-Mart Blog: Day One”

First in “a series of postings on the ways Wal-Mart is talking about changing its business; to look at how seriously we should take those changes; to consider their possible wider impact, and Wal-Mart’s chances for success.”

Wal-Mart and organic food

Reuters: “Wal-Mart doubling organic food offerings”

Demonstrating how the “Wal-Mart effect” can have a positive and “green” health and environmental impact, “Wal-Mart Stores Inc. aims to be the mass-market provider of organic food, and will have doubled its organic offerings over the next couple of weeks.”

“For food manufacturers, getting into a new category such as organics can be risky without a retailer committed to selling those products, so Wal-Mart’s push into organics will likely drive more production.”

A development consistent with the comments in Fast Company today about the potential for positive change driven by Wal-Mart’s power.

Wal-Mart sets up advocacy organization to counter similar union tactic

Chicago Tribune: “Andrew Young to Head Pro-Wal-Mart Group”

Working Families for Wal-Mart: “Civil Rights Pioneer Andrew Young to Serve as Chairman of Working Families for Wal-Mart Steering Committee”

Working Families for Wal-Mart: “Hypocrisy? Yes; Union Groups Stepped Up Campaign Contributions to Maryland Legislators in Advance of Vote on Anti-Wal-Mart Legislation”

Working Families for Wal-Mart:“Statement by Charles W. Baird, Ph.D., National Steering Committee Member of Working Families for Wal-Mart”

Maryland mandatory health insurance bill — and similar action brewing elsewhere

Washington Post: “Md. Legislature Overrides Veto on Wal-Mart Bill”

The bill will require private companies with more than 10,000 employees in Maryland to spend at least 8 percent of their payroll on employee health benefits or make a contribution to the state’s insurance program for the poor. Wal-Mart, which employs about 17,000 Marylanders, is the only known company of such size that does not meet that spending requirement.

Jack Yoest, in his post “Wal-Mart: Maryland is Bad for Business,” puts Maryland’s leadership role in adopting Big Labor’s bad mandated benefits idea in perspective: it apparently is consistent with that state’s politics. He quotes the Washington Post describing the new law targeting Wal-Mart as: “a legislative mugging masquerading as an act of benevolent social engineering.”

Portland Business Journal, “Labor leader pushes for Wal-Mart bill,” discussing the bill introduced in Oregon, has a couple of good criticisms of these payroll-percentage mandated health benefit laws:

• You could meet the 9 percent payroll requirement by buying a richer plan for the folks you already insure.
• Large employers, like the ones targeted by this bill, are already much more likely to offer health benefits.

See also: “NY legislators ride anti-Wal-Mart wave on employee health coverage,” and “Wal-Mart hires Clinton staffer to fight health care legislation.”

More on Wal-Mart Existing Health Care Plan

In Lehmann’s Terms, “Adverse selection on aisle two,” is a blogger’s thoughtful analysis of the Wal-Mart health care dilemma, including noting that:

• Wal-Mart draws its labor pool from among the least desirable demographics, in a health care cost sense.
• But this is true of pretty much all large retail operations.
• Wal-Mart employees are disproportionately likely to work two or more jobs (and thus draw coverage from some other employer source); to be women and/or “secondary” sources of household income (and draw coverage from their spouse’s plan); to be minors or students (and draw coverage from their parents); to be seniors and/or retirees (and draw coverage from Medicare or a pension package); and to be eligible for Medicaid and other public health programs.
• The much-maligned Wal-Mart secret benefit strategy memo “marks a brilliant strategy of counter-attack.” High-deductible plans would lower costs to the company, lower premiums to employees, and likely increase take-up rates of the offered plans (and lower Medicaid take-up rates among employees.)

Sharp critique of the sex discrimination class action

Power Line has this: “When ‘rough justice’ becomes injustice,” quoting extensively from a Wall Street Journal piece. A few key points:

• The suit is poorly suited to accomplish anything other than enriching the lawyers who are bringing it.
• The case will almost certainly be settled before a jury hears one word of testimony, as Wal-Mart seeks to avoid the uncertainty of continued litigation. [I'm not so sure about this point; Wal-Mart may be the one to break the back of the employment class action industry by holding out until the fat lady sings.]
• In order to shoehorn the case into a class action, their lawyers argue that money is “incidental” and “secondary.” In other words, the Dukes plaintiffs seek, literally, a half a trillion dollars in punitive damages alone while their lawyers contend that money is something of an afterthought.
• Actual victims, if any, will receive less than they should, and Wal-Mart will pay persons who suffered no injury.
• The better approach, however, is justice for actual victims of discrimination, not a system that requires an employer to throw trivial amounts of money at millions of individuals and hundreds of millions of dollars or more at a few lawyers. This kind of “rough justice,” under which any real victim loses her right to bring her own case for real justice while the lawyers become wealthy and move on to their next class action, makes a mockery of the civil rights laws.

Stiff price for made in USA

So you don’t want to shop at Wal-Mart. Maybe it’s not because you care about the workers, maybe you just don’t buy such cheap stuff. So you do your clothes shopping elsewhere, buying those quality clothes with the famous designer logo.

Look at the tag. Where are your clothes made? Do you think the workers who cut and sew for Ralph Lauren get paid that much better than those producing clothes sold by Wal-Mart?

Probably not: you’re probably just paying a higher profit margin in order to have that fancy label on there for all to see (plus a marginal amount for better quality cloth and thread — maybe).

Now let’s look at the cost of buying American-made products from a company that sounds like God’s gift to workers.

You can buy a Fine Jersey Short Sleeve T-Shirt for $15.00, plus shipping.

Or, go to Wal-Mart online and get 2 Hanes tees for $8.94. That’s better than 3 for the price of 1. And that’s why a majority (63%) of union households do or would shop Wal-Mart — despite all the union propaganda!

Photo credit: Adam Bartlett via flickr