Corporate Greed vs. Public Good, Where America Shops

My daddy was a union man. He was a papermill worker for 20 years and helped to organize the millworkers by joining with the steelworkers union, not having one of their own. Since he retired a few years after the union was formed, he only got $20.00 per mo for a pension right up until his dying day in 2006. He was 83 yrs old.

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Corporate Greed vs. Public Good, Where America Shops

By Jane Birnbaum

Behind the yellow smiley-face of the all-American Wal-Mart myth is a company that is the largest foreign importer in the nation, where workplace policies may mean workers need two jobs and depend upon public support to get by.

Betty Fought loved her job as a Wal-Mart greeter, one of the smiling employees who welcome shoppers in the nearly 3,000 U.S. stores of the world's largest retailer. Working full-time again at 60 after strokes disabled her husband Edward, an electrician, Fought twice stopped suspected shoplifters at the Aberdeen, Wash., store. She personally supplied and washed the towels she used to wipe carts in which some customers had carelessly diapered their babies.

But when Fought fell while pushing carts and became disabled, managers for Wal-Mart—the nation's largest private employer, founded in 1962 in Rogers, Ark., by retailing titan Sam Walton—stopped being so friendly. The Foughts waited so long for workers' compensation they had to take out a second mortgage which, along with other bills, at one point left them living on $18 a month.



From America@work, April 2001.




"It was a surprise the way they treated me," 66-year-old Fought says today. She had to go to court to win workers' compensation. Then, according to her lawyer, Wayne Lieb—a leader among Washington State workers' compensation lawyers—Wal-Mart arbitrarily stopped payments more than three months before her state pension kicked in this year, again leaving the couple without income. "You see how Wal-Mart advertises care and concern for people," Fought says. "But the minute I needed disability, there was a fight. They were hypocritical—treating people the way they treated me is not Wal-Mart's image."

Experiences like Fought's led Washington State last December to take the unprecedented step of decertifying Wal-Mart's self-insured workers' compensation program. (Wal-Mart has appealed the ruling and is managing its program with state supervision.) As a greeter, Fought personified Wal-Mart's caring image—yet her actual experience is just one of many events illuminating the distance between Wal-Mart's image and what it really means to work for Wal-Mart, shop at it and live near it.

In 1999 and 2000, a Cone Inc./Roper Poll survey rated Wal-Mart as the nation's top "good corporate citizen"—more a testament to savvy marketing than actual fact, says Robert Ross, sociology professor at Clark University. "People hold Wal-Mart in high regard because of its advertising that it delivers convenience and low prices," he says. "The happy face bounces around and they have this great gimmick of smiling retirees as you walk in and you can buy cheaper stuff there. Some consumers don't know the facts about Wal-Mart, and it's hard for the facts to get through, because people don't like paying attention to uncomfortable facts. And people who know just focus on the lower prices."

For those who care about "uncomfortable" facts, here are some about Wal-Mart.

All-American foreign importer?


"We must make Wal-Mart respect workers and obey the law."
—UFCW President Douglas Dority



Wal-Mart stores often are festooned with red, white and blue bunting. Until 1998, store signs urged shoppers to "Buy American." But in 1999, Wal-Mart was the nation's largest importer, according to the Journal of Commerce, with 53 percent of its clothing coming from China, according to a New York Times story last year.

Kathie Lee Gifford, who has lent her name to Wal-Mart's "Kathie Lee" line of women's apparel, acknowledged in 1996 that pieces of her line had been made in a Honduran sweatshop by teenage girls. That same year, she pledged to have independent monitors inspect the factories where "Kathie Lee" goods were made. However, in 1997, her goods were found being manufactured in a New York sweatshop in which Chinese immigrants toiled 60 to 80 hours a week, some without pay. And Wal-Mart was found buying "Kathie Lee" handbags made in a sweatshop in China using forced labor as late as 1999, according to a Business Week investigation after a report from the National Labor Committee, a workers' rights group.

With more than $193 billion in worldwide sales in 2000—52,100 pairs of women's jeans sold daily and 19,750 pairs of shoes hourly, according to The New York Times—Wal-Mart is the nation's largest American company—and a leader in corporate scorched-earth practices, according to Charles Kernaghan, NLC executive director. "Wal-Mart is driving the race to the bottom by multinational corporations roaming the globe for lower labor costs," he says.

United Food and Commercial Workers President Douglas Dority agrees. "You have Wal-Mart, this mammoth retailer, lowering living standards worldwide by busting union efforts, intimidating workers, driving down wages and disobeying worker protection laws," he says. "We must make Wal-Mart respect workers and obey the law, or the company will lower living standards for all workers."



Not made in USA: Family members hand food to workers at the Chentex plant in Nicaragua, where workers are locked behind enclosures throughout their workday.



The NLC found and the Milwaukee Journal Sentinel reported last year that in Managua, Nicaragua, Wal-Mart has been among retailers using the Chentex sweatshop to manufacture private-label goods. While Wal-Mart says it has a code of conduct guaranteeing workers' rights for anyone sewing Wal-Mart garments around the world, Chentex's Taiwanese owners fired in 2000 union leaders asking for raises for workers making less than $5.30 a day for a 10-hour day, or less than 53 cents an hour.

With President George W. Bush promising on the campaign trail to "look South" and Congress last year enacting the Caribbean Basin Trade Partnership Act, which extends to Caribbean and Central American nations no-tariff benefits similar to those under the North American Free Trade Agreement, this region is poised for an explosion of garment sweatshops, says Clark University's Ross. Central America is extremely convenient for retailers and it offers lower shipping costs than Asia.

But the region also is where union leaders, often women, routinely are threatened by employers, according to the Support Team International for Textileras, a network of women community and union organizers. Only such factory clients as Wal-Mart and the Bush administration, which the Walton family backed with huge campaign donations, can ensure workers are protected, Ross adds. (In the 2000 election cycle, Republican Party committees received $100,000 from John Walton, $81,000 from Jim Walton and $10,000 from Alice Walton, the children of the deceased Sam Walton, while reaping another $75,000 from the company and $384,000 from other board members, according to Federal Election Commission filings.)

"With Caribbean Basin parity," Ross says, "the danger is that by using China as a whip, labor standards in Mexico and Central America will be driven even further down by sweatshop owners competing with business from the big private-label retailers led by Wal-Mart."

Does Wal-Mart enjoy corporate welfare?
Wal-Mart styles itself as deeply generous toward U.S. communities and families and in 2001, the Wal-Mart Foundation plans to give $190 million in charitable contributions. Yet Sam Walton's widow and four children—who control nearly 40 percent of Wal-Mart stock, while son S. Robson Walton chairs and son John Walton sits on Wal-Mart's board—approve the actions of Wal-Mart's executives that set employee pay. But the wages approved by the Waltons—each of whom ties with Microsoft CEO Steven Ballmer as the seventh wealthiest Americans with assets of $17 billion apiece, according to Forbes magazine—do not enable Wal-Mart's million-plus U.S. workers to support themselves, according to Marlene Richter. Richter is executive director of the Las Vegas chapter of the National Interfaith Committee for Worker Justice, which supports efforts by UFCW Local 711 to help Wal-Mart workers organize in Las Vegas. (Wal-Mart workers in Las Vegas maintain their own website.)

Twelve years ago, Arkansas state Rep. Jay Bradford, then a state senator, was asked by a constituent if he realized how many Wal-Mart workers were using Medicaid and other taxpayer-financed public assistance programs. "I brought that up in a speech, and it shot right up in the media that this little state senator challenged Wal-Mart on its compensation," Bradford recalls. "Now, it's common for retailers to employ part-timers with no benefits, but people were not accustomed to this back then, and Wal-Mart led the no-benefit scenario."

Today, through company manipulation of employees' work schedules and high costs of employee participation, approximately 60 percent of Wal-Mart's employees are not covered by the chain's health package, according to UFCW. In contrast, the national average for wholesale and retail workers ages 18 to 64 not covered by their employers' health insurance plans is 53 percent, according to the research group the Employee Benefit Research Institute.

Instead, Wal-Mart sends its bill to taxpayers, says David Blitzstein, UFCW negotiated benefits director. "During health care reform six years ago, we shared a study with Congress in which we found the cost-shift from Wal-Mart alone to other employers was $1 billion a year."

A bad neighbor?
Living near a Wal-Mart can be dirty business. Software engineer Kimsey Fowler Jr. maintains a website detailing the trials of his father, Kimsey Fowler Sr., a retired utility marketing manager, Wal-Mart shopper and shareholder. In 1988, a contractor for Wal-Mart chopped down a row of mature oak trees on private property between a new Wal-Mart lot and the elder Fowler's backyard in Dublin, Ga. After the store was built, neighbors had to protest before the contractor put up a chainlink fence to stop trash from Wal-Mart's parking lot from blowing into the subdivision and to deter the friends and family members of Wal-Mart shoppers from walking dogs in neighbors' gardens. But when the fence blew over, the contractor refused to replace it—and Wal-Mart wouldn't get involved.

"Wal-Mart managers just never answered me," says Fowler Sr. "I think a company should help out when they can, especially if they can afford it," he adds.

Says Fowler Jr.: "I believe Wal-Mart once was an honorable company when Sam Walton was alive, but since his death, a corporate attitude of greed has turned Wal-Mart into a bad neighbor who seems content to trash communities for the sake of fat profits."

Customer care?
Wal-Mart's "associates"—the term the company uses to describe the store's clerks, stockers, cashiers and others—are told to greet customers who are within 10 feet of them. But when customers are physically assaulted in Wal-Mart parking lots, or are seriously injured and even killed by falling merchandise stocked high on Wal-Mart shelves, they or their families can wind up fighting Wal-Mart lawyers in long litigation battles to get compensation for medical care and other damages. At first, loyal shoppers can't understand what's happening. "They all say, ‘I can't believe Wal-Mart would do this to me,'" says Denver lawyer Jeffrey Hyman, who calls Wal-Mart "the most difficult corporate entity I've ever faced."

In January, CBS's "60 Minutes" reported on the bad behavior by Wal-Mart's lawyers. On the broadcast, Houston Judge Sharolyn Wood said Wal-Mart lawyers didn't play by the rules and "also hid and conducted themselves in a way to disguise and hide anyone getting at the truth." Wood sanctioned Wal-Mart for concealing evidence and being intentionally misleading, and the case quickly was settled. Another judge was quoted as saying, "Rarely has this court seen such a pattern of deliberate obfuscation, delay, misrepresentation and downright lying." To level the playing field, Lewis Laska, a Nashville, Tenn., attorney and legal publisher, maintains the website http://www.wal-martlitigation.com/, where lawyers can purchase and share information specifically about Wal-Mart. "I'm trying to help small-town lawyers seek justice for their clients against a large corporation," Laska says.



Wal-Mart workers: No voice at work
"In state after state, Wal-Mart has used every trick in the book to prevent workers from having a voice on the job," says UFCW organizer Harold Embry. "They do everything that's within the law, and some things that are not."



Coincidence? After meat cutters in a Texas Wal-Mart won a voice at work with UFCW last year, the chain chopped back the number of meat cutters it employs in stores, prompting UFCW to file ULP charges.




Wal-Mart has made every effort to prevent UFCW organizers from contacting workers on the job, says UFCW attorney George Wiszynski. "Wal-Mart has consistently maintained policies saying they welcome outside groups," Wiszynski says. "But last summer, they put out a policy that says if a union shows up, you move them away." After the success of meat cutters in a Jacksonville, Texas, Wal-Mart in getting a voice at work with UFCW last year, the chain drastically reduced the number of meat cutters it employs in stores. Although saying "there is no serious dispute that Wal-Mart is opposed to unionization," and citing a 56-page Wal-Mart "Manager's Toolbox to Remaining Union Free," the NLRB's General Council office dismissed in March UFCW charges that Wal-Mart switched to pre-packaged meat in response to the union's effort to organize meat department workers. The UFCW is appealing.

At the same time, Fortune magazine—edited by John Huey, who co-wrote Sam Walton's 1992 best-selling autobiography, "Sam Walton: Made in America, My Story"—named Wal-Mart 80th of the country's 100 best companies for employees last year. It is an award that Wal-Mart "associates" find less than believable.

"The managers always are bragging about how much money Wal-Mart makes and now that Wal-Mart made the Fortune list of best places to work, they brag about that," says Valerie Gonzales, 33, who works in the infant department of a Las Vegas Wal-Mart. "But if Wal-Mart is going to brag so much, it should have the decency to pay us so we don't have to work two jobs and can afford health insurance."



Living wage? Valerie Gonzales needs food stamps and emergency room health care to support her family while making $7.79 an hour at Wal-Mart.



After nine months on the job, Gonzales makes $7.79 an hour for a 35-hour week, a schedule the company cut back from 40 hours. Supporting five children while her fiancé undergoes job training, Gonzales had to forgo Wal-Mart health coverage after learning her share of the monthly premium was nearly $200, with a $350 annual deductible each for her and her children. If Gonzales or the children need care, they visit emergency rooms. To get by, she is applying for food stamps.

Gonzales supports efforts by UFCW Local 711 to organize the Las Vegas Wal-Marts because a union would be "an improvement," she says. The UFCW organizing effort in Las Vegas is part of a broad community coalition led by the local chapter of the NICWJ, which has created a code of conduct asking Wal-Mart managers to allow workers to organize, provide them with affordable health care and treat them with dignity.

"The reason we support the union drive becomes more urgent every day," says NICWJ director Richter. "If Wal-Mart is going to pay substandard wages and benefits, then there's not going to be a reason for other retailers and grocery chains to keep union contracts if they can get away with lowering wages. We'll have a lower standard of living across the board in Las Vegas, and lose those good wages and benefits that allow workers to raise their families."

Standing in front of a Wal-Mart recently, Richter says she marveled that "people of all backgrounds poured into the store at 9 a.m."

"I was thinking, ‘Do you have any idea what is going on behind those doors?'"


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