Wal-Mart and Human Dignity: Labor Practices Come Under Fire

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Wal-Mart and Human Dignity: Labor Practices Come Under Fire
By David W. Reid, Publisher and Editor
Vital Theology, Fort Collins, CO

The public relations campaign rolled out early this year by Wal-Mart to "set the record straight" regarding its labor practices has done little to quell the open warfare between the company and its critics.

The back-and-forth charges highlight a stark contrast in viewpoints.

The company proclaims that efforts to unionize the tire and lube units of stores in New Castle, Penn., and Loveland, Colo., were soundly defeated in democratic elections. Union organizers fire back that the union had no chance of winning. Wal-Mart delayed the Pennsylvania election by five years and stalled so long in Colorado that only a few of the employees who called for the vote were still on the payroll by the time an election was held.

A study by the state of Alabama concludes that Wal-Mart tops the list of companies in that state whose employees have children on Medicaid rolls, draining between $5.8 million and $8.2 million from state coffers each year. A company spokesman responds that Wal-Mart will almost always lead such lists by default because it is the nation`s largest employer.

U. S. Rep. George Miller (D-Cal.) complains that Wal-Mart received special treatment when the U. S. Department of Labor agreed to give the company 15 days notice before investigating any complaints of child labor violations. Wal-Mart announces that it welcomes a review of the agreement but that the investigation will distract from the company`s focus on compliance.

Sorting out the whole truth from half-truths is no easy task. But does any of this matter to the rest of us?

It does because human dignity is involved, said Todd David Whitmore, who directs the Program in Catholic Social Tradition at the University of Notre Dame.

Catholic social teaching has long held out for the dignity of all persons under the belief that all persons are born in the image of God.

"The flourishing of human beings depends upon our interconnectedness," said Whitmore. Catholic social teaching describes that interconnectedness as "solidarity."

"Where there is a lack of solidarity between persons, then there is a lack of recognition of human dignity and therefore, a lack of recognition of the way we all image God," said Whitmore, associate professor of theology.

Work is an important part of human dignity, he said. "Not only do we need a living wage to make ends meet, but it is part of human dignity to be paid for the work that we do."

An outspoken critic of Wal-Mart`s labor practices, Whitmore believes that the giant retailer bears watching, if only because of its size.

Wal-Mart Stores Inc. is the world`s largest retailer, with $256.3 billion in annual sales. It employs 1.6 million people worldwide and has more than 3600 facilities in the U. S. and more than 1570 in the rest of the world. According to the company, more than 138 million customers visit a Wal-Mart store each week.

Officials of the company contend that many of the attacks on the company occur precisely because it is the biggest kid on the block.

"You could almost go down the list of Catholic social teaching`s articulation of the ways in which the dignity of workers must be recognized because they are created in the image of the Triune God. Wal-Mart violates virtually every one of those," said Whitmore.

Wal-Mart not only violates the standards of Catholic social teaching, but it does so in a way that does not meet the Department of Labor`s code of conduct, said Whitmore. According to Whitmore, any factory that violates more than one of the fundamental U.S. labor laws can be classified as a "sweatshop" under federal law.

The fundamental code of conduct set out by the Labor Department includes paying minimum wage, keeping a time card, paying overtime, paying on time, and maintaining safe working conditions.

The battle over the public`s perceptions of the company has been heating up in recent weeks.

The company launched its public relations offensive in mid-January by placing a full-page ad in more than 100 newspapers across the country. The ad took the form of a letter from CEO H. Lee Scott.

"There are a lot of `urban legends` going around these days about Wal-Mart, but facts are facts," said Scott. "Wal-Mart is good for consumers, good for communities, and good for the U.S. economy."

In February, the secretary-treasurer of the AFL-CIO said that the "entire labor movement" will be involved in a campaign to drive some business away from the company by exploiting Wal-Mart`s image problems. The unions are talking of spending $25 million a year on the effort, more than has ever been spent in a union campaign against a single company.

The New York Times has been particularly vigilant in covering labor issues involving Wal-Mart. Here are some of the controversies covered by the Times and other media:

Child labor. The Child Labor Coalition says Wal-Mart has a history of child labor violations. In one incident in 2000, Maine fined Wal-Mart $205,650 for 1436 such violations. The New York Times obtained a copy of an internal audit of employee records in 128 stores. A Times story of Jan. 18, 2004, said the audit of one week`s time-clock records for about 25,000 employees found 1371 instances in which minors apparently worked too late at night, worked during school hours, or worked too many hours in a day. It also found 60,767 apparent instances of workers not taking breaks, and 15,705 apparent instances of employees working through meal times. Wal-Mart said its audit was flawed.

Employee health care. The Atlanta Journal-Constitution noted in a Feb. 27,2004, article that more than 10,000 children of Wal-Mart employees were in the state`s health program for children at an annual cost of nearly $10 million to taxpayers. With 42,000 workers in the state, Wal-Mart had about one child in the program for every four employees. A Nov. 1, 2004, article in The New York Times said that a North Carolina hospital found that 31% of 1900 patients who described themselves as Wal-Mart employees were on Medicaid, and an additional 16% had no insurance at all. A study by the University of California Berkeley found that Wal-Mart employees on a public assistance programs cost California $86 million annually, including $32 million a year for health care. The company said it provides health benefits for 56% of its hourly workers in the U. S. at monthly rates as low as $38 for a single person and $153 for a family.

Employee lock-ins. Wal-Mart came under fire several years ago for its practice of locking employees inside stores in the middle of the night. Wal-Mart argues that this is to protect employees in high-crime areas and to guard against employee theft. Several cases have been documented of employees being denied medical attention because they did not have access to keys to the doors and one employee died when an ambulance could not reach him, according to a Times story published Jan. 18, 2004. Officials at Kmart, Sears, Toys "R" Us, Home Depot and Costco have said they do not lock in workers.

Labor unions. The Associated Press has covered recent unionizing activities at Wal-Mart in detail. In February, Wal-Mart said it would close a store in Quebec, Canada, because of what company official s called "unreasonable demands" by workers trying to negotiate the first-ever union contract with the retailer. In 2000, meat cutters at a Texas store voted in favor of a union and shortly afterward Wal-Mart eliminated positions company wide. The Glove and Mail of Toronto reported on Feb. 26 that Wal-Mart had been ordered to stop harassing and intimidating workers trying to organize a store in Quebec City.

For the most part, Wal-Mart has opposed the freedom of association of workers, said Whitmore. Freedom of association is a key point in Catholic social teaching, he said, because part of who we are is our ability to relate to other persons in a free way. "Wal-Mart is now big enough to just close the store outright and not suffer while sending the message to other stores: you unionize, you lose your job," said Whitmore.

Wages. The company faces about 40 wage and hour cases seeking class certification, according to its Website. Whitmore said one suit in Minnesota is seeking compensation for 65,000 workers. Workers have said that managers instructed them to go off the time clock just as they approached 40 hours for the week or when they were about to take a break, said Whitmore. The company last year initiated a new wage structure to increase pay to some hourly workers and created a 40-person compliance team to ensure that labor laws are followed.

Gender discrimination. Six current and former Wal-Mart associates are pursuing legal action against the company. The suit was certified as a class action behalf of 1.6 million women. Wal-Mart is appealing the decision and notes that more than 40 percent of its managers are women.

Illegal workers. In October 2003, federal agents raided 60 Wal-Mart stores across 21 states and arrested 250 illegal immigrants who worked as janitors for outside contractors. According to the The Wall Street Journal, Wal-Mart has been in talks to settle the probe that is focused on whether it knew that the janitorial firms hired illegal workers.

Note: Reprinted by permission from Vital Theology, March 15, 2002.