After raising the wage of its lowest paid workers earlier this year, Walmart is now reportedly scaling back hours of some of those workers,
writes Bryce Covert.
Store managers were recently told to cut back on hours to reduce costs, which has led to them eliminating hours from the schedule, telling workers to leave their shifts before they end, or having employees take longer lunches, Bloomberg News reports. A spokesperson told Bloomberg that these changes are only happening in stores where managers had overscheduled employees.
One anonymous Walmart worker near Houston told Bloomberg that her store had cut more than 200 hours a week by asking people to go home early. Another in Fort Worth was told that the store would cut 1,500 hours and said that employees who had been asked to stay late for extra work earlier in the week were told to take two-hour lunch breaks later on to make up for those hours.
In February, Walmart announced that it would raise its base pay to at least $9 an hour by April and $10 an hour by early next year, increasing wages for about 500,000 employees and spending more than $1 billion on the effort. At the time, the CEO said the company expected those changes to lower employee turnover and attract better talent.
One of the reasons for Walmart's change in course were widespread employee protests for $15 an hour, more predictable schedules, and the right to unionize. But it was also customer dissatisfaction with poorly stocked shelves and long checkout lines. In other words, Walmart was treating its employees so badly that it was compromising customer service.
The company is now assuring the public that that focus won’t be sacrificed with the new schedule changes. The company spokesperson said reductions in hours won’t affect the focus on better staffing stores, reducing checkout lines, and filling shelves. “[W]e are committed to improving the customer experience and we will protect the investments necessary to achieve this goal,” Greg Foran, head of U.S. operations, said.
Sounds like Walmart is being squeezed by its decision to make a long-term investment in its workers that almost inevitably has short-term costs that aren't looked on favorably by Wall Street. But the increase in employee loyalty, work satisfaction, and retention will pay dividends down the road, unless company executives squander it.
