From ILCA

(January 13, 2005) Today, Wal-Mart rolled out a slick, nationwide public relations campaign aimed at defusing negative facts that have been reported about the company. Full page Wal-Mart ads containing a letter from H. Lee Scott, President and CEO of Wal-Mart, are running in over 100 major newspapers throughout the United States.

However, facts are facts, and glossy advertisements cannot erase the long-standing and well-documented negative effects that Wal-Mart’s predatory business practices have had on working families, along with their wages, jobs, benefits, and communities.

I have faith that the American public will see through this desperate “smoke and mirrors” diversion tactic being used by Wal-Mart. Consumers are aware that not everything seen in an advertisement is always the absolute truth. In the 1930s and 40s, American Cigarette manufacturers advertised that smoking offered many healthy benefits in addition to being glamorous. But it was not long before experts realized that the lies being advertised were putting the health of the public at risk.

Like the hazards of smoking, the dangers associated with Wal-Mart’s corporate practices have been exposed for what they are. Wal-Mart is creating very serious consequences for working families, the retail, manufacturing, and service industries, the health care system, and the American economy as a whole. There are many facts that Wal-Mart has selectively left out of their image campaign. But the reality of the damage being done cannot be ignored. Wal-Mart’s impact on the stability of America’s workforce is just too great.

Instead of injecting millions of dollars into yet another corporate image campaign, Wal-Mart could have alternatively invested in their employees by increasing wages and benefits. As one of the largest corporations in the world, Wal-Mart could be setting high standards for the treatment and compensation of employees, instead Wal-Mart’s example is leading to a lower standard of living for millions of American retail, service, and manufacturing workers and leading a race to the bottom.

Don’t be fooled by the power of advertising. Wal-Mart can try to put up a fancy curtain, but when you peek behind the scenes, the cold, hard facts are unveiled, leaving working families with little to smile about.

Wal-Mart Facts:

A report prepared by the minority staff of the U.S. House of Representatives Education and the Workforce Committee, “Everyday Low Wages: The Hidden Price We All Pay for Wal-Mart” (February 2004), uncovered some startling facts: Each Wal-Mart store employing 200 people costs taxpayers approximately $420,750 annually (about $2,103 per employee) in public social services used by Wal-Mart workers whose low wages and unaffordable health insurance mean most of them are among the working poor. Wal-Mart employees who utilize their health care confront high deductibles and co-payments. A single worker could end up spending around $6,400 out-of-pocket, or nearly 45% of their average annual full-time salary, before seeing a single benefit from the Wal-Mart health plan. The average Wal-Mart worker earns less than the federal poverty level for a family of four. Full-time Wal-Mart workers average a maximum of 32 hours per week. Over 39 class-action lawsuits against the company in thirty states have been filed against Wal-Mart, claiming tens of millions of dollars in back pay for hundreds of thousands of Wal-Mart employees. Wal-Mart was ordered to pay over $50 million in unpaid wages to 69,000 Colorado workers. In a Texas class-action lawsuit that was certified on behalf of 200,000 former and current Wal-Mart employees, statisticians estimated that the company short-changed its workers $150,000 over four years just based on the frequency of employees working through their daily 15 minute breaks. Six women filed a lawsuit against Wal-Mart in California claiming the company discriminated against women by systematically denying them promotions and paying them less than men. The lawsuit has expanded to potentially the largest class-action lawsuit in U.S. history on behalf of more than one million current and former female employees. While two-thirds of the company’s hourly workers are female, women hold only one-third of managerial positions and constitute less than 15 percent of store managers. An estimated 50-60 percent of Wal-Mart’s products are imported from overseas. Over 10 percent of all U.S. imports from China go to Wal-Mart. Wal-Mart plays its suppliers off of one another in search of lower and lower prices. American suppliers have been forced to relocate their businesses overseas to maintain Wal-Mart contracts; this has led to dramatic job losses in the American manufacturing sector. Overseas manufacturers are forced to engage in cut-throat competition that further erodes wages and working conditions for American and global factory workers.

The Congressional report concludes that, “Wal-Mart’s success has meant downward pressures on wages and benefits, rampant violations of basic workers’ rights and threats to the standard of living in communities across the country. The success of a business need not come at the expense of workers and their families. Such short-sighted profit-making strategies ultimately undermine out economy.”

The full report can be found at: http://edworkforce.house.gov/democrats/WALMARTREPORT.pdf



-- Statement by Ronald E. Powell, Local 881 UFCW President regarding New Wal-Mart Advertisements.