Walmart: America's real 'Welfare Queen'

By Paddy Ryan

Walmart, one of the richest corporations in the world, refuses to pay its employees a livable wage or provide any form of decent healthcare, increasing reliance on government assistance, and the need for a social safety net.

At over $446 billion per year, Walmart is the third highest revenue grossing corporation in the world. Walmart earns over $15 billion per year in pure profit and pays its executives handsomely. In 2011, Walmart CEO Mike Duke – already a millionaire a dozen times over – received an $18.1 million compensation package. The Walton family controlling over 48 percent of the corporation through stock ownership does even better. Together, members of the Walton family are worth in excess of $102 billion – which makes them one of the richest families in the world.

What is shameful is that CEO Mike Duke makes more money in one hour, than his employees earn in an entire year. Yet, Walmart – which employs millions of people in its stores, distribution centers, and warehouses – continues to abuse its employees and refuses to pay them a livable wage. The company has frequently been charged with wage theft claims by workers who point to the most common forms of wage theft: the refusal to pay proper overtime, the refusal to honor the minimum wage, and illegal paycheck deductions.

Meanwhile, Walmart routinely blocks any attempt by workers to organize, using anti-union propaganda and scare tactics, firing employees without just cause, failing to provide any form of decent healthcare coverage or a livable wage.

To make matters worse, these abusive Walmart policies have increased employee reliance on government assistance and the need for a government funded social safety net. In fact, Walmart has become the number one driver behind the growing use of food stamps in the United States with "as many as 80 percent of workers in Wal-Mart stores using food stamps."

Wal-Mart's poverty wages force employees to rely on $2.66 billion in government help every year, or about $420,000 per store. In state after state, Wal-Mart employees are the top recipients of Medicaid. As many as 80 percent of workers in Wal-Mart stores use food stamps.

Walmart's employees receive $2.66 billion in government help every year, or about $420,000 per store. They are also the top recipients of Medicaid in numerous states. Why does this occur? Walmart fails to provide a livable wage and decent healthcare benefits, costing U.S. taxpayers an annual average of $1.02 billion in healthcare costs. This direct public subsidy is being given to offset the failures of an international corporate giant who shouldn’t be shifting part of its labor costs onto the American taxpayers.

Wal-Mart workers’ reliance on public assistance due to substandard wages and benefits has become a form of indirect public subsidy to the company. In effect, Wal-Mart is shifting part of its labor costs onto the public.

Recently, Walmart workers have been speaking out against the abuses they face because of excessive corporate greed. For the first time in Walmart's 50 year history, workers at multiple stores are striking. Last week, over 70 Walmart workers in Los Angeles decided to walk off the job.

The Huffington Post reported this week that the recent wave of Walmart strikes has now grown to 12 cities across the United States, with workers walking off the job in Dallas, Seattle, the Bay Area, Miami, the Washington D.C. area, Los Angeles, Sacramento, Chicago and Orlando, in addition to cities in Kentucky, Missouri and Minnesota. 

According to the United Food and Commercial Workers, 88 workers from 28 different stores went on strike yesterday.

And it's not just Walmart's storefront employees speaking out for justice. The warehouse workers that Walmart employs through its supply chain have been striking as well. Walmart warehouse workers in Illinois and California also went on strike earlier this month.

They are fed up. And we should be too. Walmart should no longer be allowed to turn its back on the American worker and push its labor costs onto the American taxpayer. We need to protect our social safety net, American workers and American taxpayers. If Walmart can afford to pay CEO Mike Duke an $18.1 million bonus package, it can afford to provide a living wage for those whose sweat and hard work has made Walmart one of the richest corporations in the world.

Wage theft: abusive employers fuel nationwide epidemic

By Paddy Ryan

Wage theft - the non-payment or the under-payment of an agreed upon wage - has been a growing problem across the country, seen in every industry from retail and service to manufacturing and construction. Wage theft primarily affects low-wage unskilled workers, forcing most families who rely on minimum wage below the federal poverty line. Unfortunately the issue has been widely under-publicized and, therefore, vastly unknown to a majority of the American public.

But many recent studies have been conducted over the past few years that are now shining a beacon of light on how bad the growing epidemic of wage theft has become. Universities, labor organizations, community groups, non-profits, and others have been collecting data on the subject for long enough now that a lot of valuable new information has been discovered.

The most common forms of wage theft: the refusal to pay proper overtime, the refusal to honor the minimum wage, and illegal paycheck deductions like transportation costs. Illegal transportation deductions are most frequently seen in the temporary employment industry, where low-wage 'temp agency' workers are driven to and from the job site.

"Although this practice is of dubious legality, many agency workers have little practical alternative but to accept these [transportation] charges if they hope to have a job."

Studies have been conducted across the United States regarding the wage theft epidemic. An especially disheartening independent study from 2009 - Broken Laws, Unprotected Workers - found that a whopping 76 percent of workers claimed they had been underpaid or not paid at all by their employer. The study – conducted by the National Employment Law Project – surveyed over 4,000 low-wage workers throughout the cities of New York, Chicago, and Los Angeles.

In 2010, the Seton Hall Law School Center for Social Justice released a report entitled All Work and No Pay, which documented rampant wage theft throughout the low-wage community in New Jersey. According to their survey results, "54% of the workers statewide were paid less money than they were promised by at least one employer."

One of the most recent independent studies was conducted by New Labor - a community outreach & labor organization - along with Jason Rowe of Harvard University. The study surveyed 291 workers in the New Jersey logistics industry and found that over one-third (36.1%) of those surveyed were not paid in full for the wages that they had been promised. That's almost 4 out of 10 low-wage workers that have been underpaid, or even unpaid, by their employer!

Wage theft doesn't only affect low-wage workers either; it affects everyones paycheck by driving down salaries across the economic spectrum.

"There is a cost to our local economies, with fewer dollars circulating to local businesses, stunting economic recovery. And there is a cost to growth and opportunity as generations of workers are trapped in sub-minimum wage jobs."

Fighting Back

In 2011, the National Employment Law Project released a guide to combating wage theft entitled Winning Wage Justice, An Advocate's Guide to State and City Policies to Fight Wage Theft.

NELP's guide contains seven basic principles to help stop wage theft:

1. Raise the Cost to Employers for Violating the Law.
2. Make Government Agencies Effective Enforcers of the Law.
3. Better Protect Workers From Retaliation.
4. End the Exclusions in Minimum Wage and Overtime Standards.
5. Stop Independent Contractor Misclassification and Hold Subcontractors Accountable.
6. Ensure Workers Are Paid for All Hours Worked.
7. Guarantee that Workers Can Collect from Their Employers.

NELP was able to publish its suggestions with the help of new information, released by organizations like New Labor and Seton Hall, who have provided a better understanding of the problem, and how to successfully combat it.

However, only a limited number of states are actually listening to these suggestions and trying to do something about the problem.

In both New York and California, Wage Theft Prevention Acts were passed in 2011. The New York Wage Theft Prevention Act, expands the civil and criminal remedies that are available when employers fail to comply with the provisions. The California Wage Theft Prevention Act of 2011 differs significantly from the New York law because it requires that notices be given only to non-exempt (hourly) employees. Massachusetts also has wage theft legislation in place, along with Connecticut, Illinois, and (surprisingly) North Carolina.

But all of these state laws need to be strengthened.

According to a new study from the Progressive States Network,

As it turns out, one of the most important findings of this report is that state wage theft laws, in general, are almost universally inadequate. In our scoring system, the two highest-rating states, New York (with an overall grade of C+) and Massachusetts (with a grade of C), only receive 77% and 74% of the total possible points respectively, and it is a steep fall from there: Connecticut, Illinois, North Carolina, and California follow with grades of D, and the other 44 states and Washington, DC receive F’s. Further underscoring the deep drop-off, the tenth-ranked state receives only 52% of the total points, and the bottom eleven states all receive 25% or less. Two states — Alabama and Mississippi — scored zero points.

However, there is some good news. The legislation passed in 2011 has let workers reclaim millions of dollars in stolen wages throughout New York and California.

The National Employment Law Project reports that, "In the past year alone, workers recovered tens of millions of dollars in unpaid wages from their employers in a range of industries. For example, ... New York car wash workers received $3.5 million in unpaid overtime."

Unfortunately, only six states currently have laws dealing with wage theft, and all of those laws need to be strengthened. The fight against wage theft is just beginning and there is much more to be done. Most workers are not as lucky as those workers who were able to recover millions of dollars in lost wages. Many will continue to suffer from the abuses of wage theft, and still desperately need help. It will take a team effort by the liberal media, an informed and concerned citizenry, community organizations, advocacy groups, Democratic politicians, organized labor and the like, to put an end to wage theft for good.

So in that same spirit, please, if you care about the civil rights of workers and the future of organized labor, share this diary. Thank you.