Monday, December 31, 2012

Walmart Stores, Inc

LOS ANGELES -- Warehouse workers in Southern California have filed a petition in court to name Walmart as a defendant in a federal wage-theft lawsuit, marking a significant turn in low-wage supply chain workers' fight with the world's largest retailer.

Although workers in Walmart's contracted warehouses in California and Illinois have alleged labor violations in the past, the filing on Friday is the first time Walmart itself has been directly implicated in the claims of abuse. Until now, only the retailer's subcontractors have been accused in court of shorting workers on pay and forcing them to work in substandard conditions.

"Walmart's name does not appear on any of these workers paychecks, and the Walmart logo does not appear on the t-shirts they're required to wear," Michael Rubin, the workers' lawyer, said on Friday. "But it has become increasingly clear that the ultimate liability for these workplace violations rests squarely on the shoulders of Walmart."
While Walmart directly manages much of its distribution network, the company outsources the operation of some of its largest warehouses to third-party logistics firms, which in turn hire low-paid temporary workers to perform the heavy lifting. These warehouses have become the target of a union-backed organizing effort through the groups Warehouse Workers United and Warehouse Workers for Justice, and several of them have been hit with employee lawsuits and labor-law violations.

In the case amended Friday, six workers at a Walmart-contracted warehouse in Riverside, Calif., sued a series of subcontractors last year, claiming they were paid less than the minimum wage, required to work in excessively hot conditions and retaliated against by superiors as they loaded and unloaded trucks and containers. Although the workers said the products they handled were destined for Walmart stores, the mega-retailer was not originally named in the suit.

Worker advocates have argued all along that Walmart, as the top company in the contract chain, is morally responsible for the working conditions at the warehouses its goods pass through. By trying to bring Walmart into the lawsuit now, they hope to prove that the company is legally and financially responsible as well, arguing that Walmart controls the operation and serves as the ultimate beneficiary of the work.
"I know that Walmart is responsible for all of this, even though they say they have nothing to do with us," said one of the plaintiffs, David Acosta, speaking in Spanish on a call with reporters Friday. "The boxes say Walmart, the containers say Walmart -- everything belongs to Walmart."
Walmart spokesman Dave Tovar has said the company has made a "business decision" to no longer comment for Huffington Post stories, "due to the one-sided reporting and unfair and unbalanced editorial decisions."

Acosta said he and his colleagues, many of them Latino immigrants, worked 12 to 16-hour days, earning roughly the minimum wage without overtime pay. He said they received a lunch each day but no other breaks. "Our dignity was thrown to the floor," he added.

The success or failure of the suit could have broader implications for workers who try to sue subcontractors. As HuffPost reported last year, much of the retail sector's supply chain is now predicated on a system of outsourcing, where larger, brand-name players subcontract the work to smaller, little-seen players, who ultimately hold the legal liability for workers' well-being. A similar arrangement now persists in many food-processing and manufacturing operations as well.

Walmart Stores, Inc. is an American multinational retail corporation headquartered in Bentonville, Arkansas. With over two million employees and 8,500 stores, Walmart is the largest private employer in the world. It is also the third largest corporation in the world, ranked just behind the energy giants Shell and ExxonMobil.
There is perhaps no U.S. corporation that exploits its workers as brutally and effectively as Walmart. Paid on average only $8.81 per hour, hundreds of thousands of Walmart employees—including many full-time workers—live below the poverty line. To keep these underpaid workers vulnerable and compliant, Walmart deploys numerous union-busting tactics and other dirty tricks such as forcing higher-paid, full-time employees to work inconvenient “flexible” shifts in order to get them to quit, imposing Darwinian-style policies on the sales floor to reduce worker morale, and pressuring employees to work overtime without pay or risk being fired. Walmart also systematically engages in illegal employee wage theft, as store managers are trained to falsify time sheets or simply not pay employees for all their hours worked. In fact, between 2005 and 2011, Walmart settled over 70 class action lawsuits involving the stolen wages of over a million current and former employees, costing the company more than $1 billion in damages. And rather than providing affordable health benefits, Walmart offers each of its workers assistance in applying to state and federal welfare programs such as Food Stamps and Medicaid. Recent studies estimate that Walmart’s work force collects a staggering $2.6 billion in taxpayer-funded welfare annually, a sum amounting to $420,000 per store. 
Walmart’s enormous market share combined with its business model of selling the cheapest possible products also puts downward pressure on wages along its entire supply chain of manufacturers and farmers, as thousands of Walmart suppliers [(both in the U.S. and abroad)] are forced to cut their own labor costs in order to compete. Walmart also destroys many more jobs than it creates, eliminating approximately 150 retail jobs in every county it enters, along with many service jobs too, as Walmart’s arrival often decimates entire downtown shopping districts. Walmart’s main pretense—that its low prices save consumers money—is more than offset by the reduced spending power of large segments of the population resulting directly from Walmart’s negative impact on jobs and wages. For these reasons and more, there is no corporation more singly responsible for the impoverishment of American workers than Walmart.
  • Walmart made $15.4 billion in profits in 2011, despite the recession.
  • If Walmart paid all their 1.4 million U.S. employees an extra $5,000 per year, they would still make over $7 billion in profit.
  • The six heirs to the Walmart fortune are together worth $93 billion, which is equal to the net worth of the bottom 41% of the U.S. population.
  • The Walton family has given only 2.4% of their wealth to charity. By comparison, Bill Gates, Warren Buffet, Mark Zuckerberg and over 70 other wealthy people have given over 50%.
On October 9th, 2012, hundreds of Walmart employees in twelve states walked off the job in the first ever strike in the corporation’s fifty year history, achieving widespread public support and winning some early concessions from the corporation. Given Walmart’s size and influence over the entire economy, the continuing campaign by these courageous workers carries implications far beyond the behemoth’s own big box stores, as their efforts help promote the growth of a mutually-supportive grassroots movement of education, protest and civil disobedience.

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