CommunityPam's House Blend

Wal-mart tries to rehab its rep, then f*cks that up

The behemoth retailer (and contributor to DeLay defense fund) was feeling the pain from all the bad PR about off-the-clock workers and discrimination lawsuits. The arm was further twisted because of the fact that the wages are so poor and so many of the positions part-time that it ensured “health care” amounted to employees using the ER as “primary care.” Less than 45% of Wal-mart’s workers have health insurance.

The solution: develop a low-cost health care plan for employees. Wal-mart’s cheaper plan includes premiums that would cost as low as $11. Good PR, right? Look at this, from the Arkansas Daily Blog, via the good folks at Facing South:

The company deserves points for trying. But … it’s not going to do much for a low-wage family.

First there’s a $1,000 deductible to satisfy before you get any coverage … Then there’s $65 a month for family coverage or $780 a year. [the “$11 premium” will only be availble “in some areas.] So a poor family eking by on minimum wage is out, at a minimum, $1,780 a year before it gets any coverage under the Wal-Mart plan and then it still has co-pays.

Unfortunately, even whatever little bit of positive spin left in that initiative is further undone by a little board memo that surfaced, in today’s NYT:

An internal memo sent to Wal-Mart’s board of directors proposes numerous ways to hold down spending on health care and other benefits while seeking to minimize damage to the retailer’s reputation. Among the recommendations are hiring more part-time workers and discouraging unhealthy people from working at Wal-Mart.

In the memorandum, M. Susan Chambers, Wal-Mart’s executive vice president for benefits, also recommends reducing 401(k) contributions and wooing younger, and presumably healthier, workers by offering education benefits. The memo voices concern that workers with seven years’ seniority earn more than workers with one year’s seniority, but are no more productive.

To discourage unhealthy job applicants, Ms. Chambers suggests that Wal-Mart arrange for “all jobs to include some physical activity (e.g., all cashiers do some cart-gathering).”

…One proposal would reduce the amount of time, from two years to one, that part-time employees would have to wait before qualifying for health insurance. Another would put health clinics in stores, in part to reduce expensive employee visits to emergency rooms. Wal-Mart’s benefit costs jumped to $4.2 billion last year, from $2.8 billion three years earlier, causing concern within the company because benefits represented an increasing share of sales. Last year, Wal-Mart earned $10.5 billion on sales of $285 billion.

Watch for falling prices indeed.

Thanks to Blender Laura for the pointer.

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Pam Spaulding

Pam Spaulding