Walmart workers demand expanding food discount for employees
By Money Times
Nov 13, 2015 07:52 AM EST
Nov 13, 2015 07:52 AM EST
Walmart's labor activists have sent a petition demanding the company to give 10% employee discount in all food at all times of the year, following to successful effort to raise wages.
The world's largest retailer currently offers employees 10% discount on all merchandise and several foods include fruits, vegetables and some snacks, according to Bloomberg. The workers want more groceries to be included in the discount deal as the store's rival such as Target Corp. and Whole Foods Market Inc. already offer that leak.
Walmart already offers the food discount during the holidays between Thanksgiving and Christmas holiday, but the employees are seeking to extend it year-round.
Walmart's spokesman stated that the company puts a greater priority on better scheduling and more regular hours than on employee discount. The company invests $2.7 billion this year and next in higher wages, better training and more scheduling control.
Walmart also offers quarterly cash bonuses to hourly associates and a 401(k) program with a 6% company match.
If the employee petition on food discount meets the goal, Walmart estimates it costs the company for more than $420 million a year. Last year the company offered $500 million on employee discount for general merchandise, fruits, and vegetables.
Walmart had raised starting wages over the summer as a result of widespread protests. The company hopes that wage raising would make the employees more productive and provide better customer service.
However, the move was followed by disappointing third quarter profits. According toMotley Fool, the $1 billion new expenses in a year on raising wages was going to create a profits vacuum.
In consequences for its escalating wage costs, Walmart has been cutting employee hours and closing stores that were previously open 24 hours. Earlier this month, the company was eliminating 450 corporate positions indicating that the company was forced to cut costs elsewhere
The investors have been concerned about Walmart's escalating costs. They can see the impact its going to have on its financial performance. The company suffered the worst one-day decline in more than 27 years in October, driven by additional costs it will spend next year on higher wages.
Walmart's shares fell 1.9% to $57.58 on Wednesday.
Walmart's business can't support additional costs. However, analysts said that the company will likely feel some pressure from employees and it will be difficult for them to say no for food discount petition.
As reported in Fortune, the online petition on employee discount demand is currently about 300 signatures away from reaching its goal of 15,000 signatures.
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