Wal-Mart Stores Inc. said it would raise starting pay to $11 per hour for all its US employees and hand out one-time bonuses as competition for low-wage workers intensifies and new tax legislation will add billions to the retailer's profits.
The starting wage rate increase, which is in addition to wage hikes already slated for many USA markets this coming fiscal year, applies to all US hourly associates, including those who work in stores, Sam's Clubs, the ecommerce division, logistics and the company's home office.
It will also give a one-time bonus to associates who already make $11 or more that will range from $200 to $1,000, depending on how long they've been with the company. The payout will cost Walmart a total of $400 million dollars.
Wal-Mart, the nation's largest private employer, has fought in recent years to improve its image in the USA, as it weathered criticism over its treatment of employees. The company is also expanding its maternity and parental leave policy and adding an adoption benefit.
The combined wage and benefit changes will benefit the company's more than one million USA hourly associates.
The nation's largest retailer announced today that eligible associates will receive a one-time cash bonus of up to $1,000.
Walmart's announcement follows a series of similar moves by major corporations that also credited the tax cut with bolstering their businesses.
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"Tax reform gives us the opportunity to be more competitive globally and to accelerate plans for the USA". Paying workers more will help ensure those stores are pleasant shopping environments - a necessity for Walmart if it is to keep growing its sales. Last quarter, the Bentonville, Arkansas-based company posted its strongest US sales gain in more than eight years. The new wage increase will take effect in February.
The company will also expand hourly leave, "providing full-time hourly associates in the USA with 10 weeks of paid maternity leave and six weeks of paid parental leave", it says. Previously, birthing mothers got six to eight weeks at half pay.
The changes in parental leave put salaried and hourly workers on the same footing.
With this move, the world's largest private employer has scored big points with Republican politicians, who now have a talking point for the campaign trail, and maybe also from shoppers who see its wage increase as socially responsible.
The raise will increase the average hourly pay at Walmart for full-time employees from $13.85 to $14.50.
Twelve states already have minimum wages of at least $10, according to the Economic Policy Institute. Walmart's online business is surging.