‘A Stunning Defeat For Wal-Mart’

From the Chicago Sun-Times:

Big-box retailers would be required to pay their Chicago employees a “living wage” — at least $10 an hour and $3 in benefits by 2010 — under a groundbreaking ordinance approved today that sets the stage for a court fight.

The 35 to 14 vote by a bitterly divided City Council is a victory for organized labor, a stunning defeat for Wal-Mart and the latest in a string of legislative embarrassments for Mayor Daley…

The ordinance that will make Chicago the first big city in the nation to mandate wage and benefit standards for retailing giants is a watered-down version of the original.

Last month, proponents made a series of concessions aimed at softening the blow to business.

Instead of raising wages and benefits in one fell swoop, they agreed to a four-year phase-in that calls for giant retailers to pay: $9.25-an-hour and $1.50 in benefits on July 1, 2007; $9.50 and $2 a year later; $ 9.75 and $2.50 on July 1, 2009 and the full $10-an-hour and $3 in benefits on July 1, 2010. After that, the “living wage” would be raised annually to match the rate of inflation.

Posted by Media Team on Wednesday, July 26, 2006

Click Here for a Printer-Friendly Version

COMMENTS

Hopefully wal-mart will fulfill their threat to pull out of Il as the threatened to do.

dk in Mid Atlantic
Wednesday, July 26 at 10:17 PM

It’s about time someone stood up to Wal-Mart. WAY TO GO!!!!! Hopefully other cities/states will follow in the same footstep.

Nancy in Wisconsin
Wednesday, July 26 at 10:40 PM

This was NO defeat for WM, but merely a little set back.  This ordinance is NOT law as yet.  Mayor Daley in all likelyhood he will veto it for the good overall.  (Too long to explain all of this).  If he does not veto, then it will have to stand a court challenge and I will predict that it will not prevail and that the courts call it unconstitutional.  This is also too long to explain for those who are not knowledgeable in municipal law and how it has to subscribe to the State
and Federal Statutes.  Don’t jump too high for joy as this is only one phase until the ordinance is declared void.

knowledgeable in
Thursday, July 27 at 01:07 AM

Oh yes, what a big victory for the workers. Wal-Mart might be prevented from opening one its stores in an economically depressed area. I’m sure the workers will love the fact that job opportunities could be taken away from them. I guess it doesn’t matter that their starting wage ($7.25/hr) is higher than that of their unionized competitor, Jewel ($6.55/hr). Of course not. All that matters is fighting Wal-Mart no matter what. So keep fighting the good fight. Keep bringing victories like this to the workers. I’m sure they’ll thank you for maintaining the status quo of high unemployment and dwindling opportunity.

Patrick in Vermont
Thursday, July 27 at 03:13 AM

Patrick, this is an example of the uneducated getting passionately behind something they don’t understand.

Big T in Rogers, AR
Thursday, July 27 at 07:51 AM

I will repeat what I said on another post:

“This is not going to stop WM or Target from getting into this market of millions of customers!!!  What really scares WM and Target is that once they enter Chicago and start paying a far wage the rest of the country and their employees are going to demand the same law or not in every store they have!!!  I think I see the dominos starting to fall!!!”

And here is a responce to the uneducated,

“Everyone says poor WM will now just move to the suburbs and pull the customers out there; wakeup idiots WM is already in the Suburbs and have been there for years!!!  So please quit saying they will just set up shop outside the City, it shows how uneducated you are!

The minute WM opens a store paying this wage rate will be the end to WM as we know it, every employee in the country will and should demand the same rate of pay.

By the way WM please stand behind what you say and pull out of Illinois, The land of Lincoln.”

NTD in Illinois
Thursday, July 27 at 08:57 AM

No way to Veto this, it received 35 votes which was 1 more then the the 2/3’s needed to override a veto!

Happy in
Thursday, July 27 at 09:00 AM

Oh no!  Who will want to work at the mom and pop stores in those area’s now that WM has to pay better wages??  What about mom n pop and the little guy?

Harold in Dallas
Thursday, July 27 at 10:30 AM

And soon should start the challenge after challenge after challenge that the deep pockets of Wal-Mart can support.
Drag this through every legal appeal that the world has ever seen. Anything is better than paying the staff a better wage.

Everyone is getting to know Wal-Marts tactics.
Everytime Wal-Mart does this people take note and become more turned off by this retailer.

JM in USA
Thursday, July 27 at 11:33 AM

Happpy don’t be too happy yet.  You are correct in that there are enough votes to overide a veto, assuming that all 35 will vote the same way as in the passage.  I still stand that it will not pass a court challenge—(a speical law for a specific class)

knowledgeable in
Thursday, July 27 at 03:28 PM

Not only will these poor / mostly black people not have a decent place to work with benefits - they will now have to pay considerably more for goods and services that they could be paying less at Wal-Mart, K-Mart or Target - after they move out of the city.
This is genious!!

Dennis in USA
Thursday, July 27 at 04:01 PM

“Anything is better than paying the staff a better wage. “

No, anything is better than being singled out for unfair treatment by a city council. If WalMart were to give in to Chicago in this way, what is to stop Detroit from claiming that 25$ or 40$ per hour is the living wage and that all retailers who have 7 letters in their name and are headquartered in Arkansas have to pay it!
The fact is that this ordinance won’t survive a court challenge and it shouldn’t.

Give any logical reason why WalMart should pay more than its competitors or more than market wages other than “Because they make lots of profits and it’s uncool, man!” or, “Because corporations are evil, man and they should just give more to their employees because they’re rich!”

“Living Wage” isn’t a valid concept in a market economy. It’s valid from a union perspective because it gives a living to union bosses, union reps, union lawyers, union lobbyists, union political hacks, former presidents of the union and their kids..and cousins...and friends from the club..etc

Mags in
Thursday, July 27 at 04:19 PM

Mags is right. The cities that have been mentioned that have similar wage laws do not target a select group of businesses. It will not stand in the courts and should not. It only takes 2 votes to overide and i would not be suprised to see Daily pull this one out. It is interesting that the organization that attracts other retailers to our city has already said it intends to direct interested parties other than WM to the burbs and wards where aldermen fully understand the importantace of retail jobs and taxes in the areas they represent. This is clearly bigger than WM and Target.

A. Lottabull in
Thursday, July 27 at 08:12 PM

I have worked for Wal-Mart and never thought that their wages were too low.  Since Sam dies Wal-Mart has sold out to the coorprate world.  Rarely do the employees get the bonuses that are dicussed in orientation nor do emplyees get the training they once had.  The customer service is not what it once was and frankly I don’t think that the majority of the emplyees deserve those kind of wages.

Stephanie in Texas
Thursday, July 27 at 09:40 PM

We all know that it’s possible for Wal-Mart and Target to pay a living wage and any argument to the contrary is pure B.S.  The only true reason to oppose this idea is because you as an individual feel that you are better than Wal-Mart or Target employees and that you personally can judge or deside who “deserves” to live a decent life (or you wouldn’t be a Right-Winger), so let’s dispense with the false, transparent arguments.  These would include “But we have a market economy” (not exactly, and those rules don’t apply to the rich), and “Paying people a decent wage is actually hurting them, because, you know, I actually care - seriously.”

Generic Wal-Mart Wageslave in Michigan
Friday, July 28 at 04:25 AM

this is great ,as an employee of walmart i understand the need for these workers to be paid fair.  walmart is little more than a sweat-shop with employees working in the heat with very few if any breaks and forced to stand all day

stephen in north carolina
Friday, July 28 at 06:33 AM

Walmart is getting more and more bad press. Should this company look at new leadership? Possibly so. Never has there been so much short term thinking done in a corporation.
This company may be quite a ways away, but it is still getting closer and closer to the tipping point. I noticed in the news that their shareholder stock is at a 4 year low.
They could not make a go at it in South Korea. The Sam’s Clubs that I see in my area have near empty parking lots. Sam’s clubs were supposed to be the big threats when they came here. They have been anything but.
Walmart has a bad name in Canada. Every talk show on the radio, Walmarts name comes up as a bad employer. Everything goes in circles. What rises quick may fall quickly too.

Alex in Ontario, Canada
Friday, July 28 at 07:49 AM

Generic,
explain how the market economy does not apply to the rich.  I would love to hear this..

Big T in Rogers, AR
Friday, July 28 at 08:31 AM

Generic,

Just because a business COULD pay better wages, (and that is far from proven in WalMart’s case.. haven’t looked at it myself but I think they run about a 3-4% profit margin) doesn’t mean they should. Businesses operate to generate return for investors. If your labor is WORTH 7$/hour then that is what a business should pay you. To do anything else is a case of corporate malfeasance, as they are responsible to the investors. Who, by the way, run the risk of losses also. Would you want employees to share the profits of a business and be willing to accept no pay or reduced pay if the business falters? To equilibrate the situation of the employee with that of the investor that is what you would have to accept.

Still haven’t seen a logical reason why WalMart should pay the so-called “living wage” other than “THEY CAN!!!”

Mags in
Friday, July 28 at 08:54 AM

Mags-

I took a look at the EPI’s claim that Wal-Mart could pay its hourly workers $2,100 more per year on my blog. Let’s just say the claim doesn’t stand up to even the slightest amount of scrutiny. You are also correct about Wal-Mart’s profit margin; it’s 3.54%.

Generic-

We all know that it’s possible for Wal-Mart and Target to pay a living wage and any argument to the contrary is pure B.S.

Come on, Generic! Look at the numbers. There is no way these stores could pay a “living wage” (What is it anyway? No one will give me a number!) without taking an unacceptable blow to their profitability.

The only true reason to oppose this idea is because you as an individual feel that you are better than Wal-Mart or Target employees and that you personally can judge or deside who “deserves” to live a decent life (or you wouldn’t be a Right-Winger), so let’s dispense with the false, transparent arguments.

You know that’s a ridiculous assertion.

These would include “But we have a market economy” (not exactly, and those rules don’t apply to the rich),

Do you even understand market economics? Sometimes I wonder. Maybe you’re just too wrapped up in Kapital to care about what economics texts say.

While we’re at it, I have other questions that you might be able to answer.

1. How are Wal-Mart and Target obligated to pay a living wage?

2. If everyone ought to receive a “living wage,” why are places like McDonald’s, Walgreens, and small businesses excluded from the Chicago mandate? Some of these are often worse offenders than big box stores. Maybe their workers just don’t matter?

Someone in USA
Friday, July 28 at 10:54 AM

Dum ass question of the day:
“How are Wal-Mart and Target obligated to pay a living wage?”

Question for someone so stupid as to ask a question like that:
Because they are people who need to live.

Those questions are about as bright as a question like: Why should I feed my dog a living quantity of food.

No wonder this world is in the mess it is with people like those who support big greedy, pay the top millions, while paying the millions the least.

JM in USA
Friday, July 28 at 02:52 PM

Hmmm, JM. “Because they are people who need to live in it” Sounds an awful lot like “Because they should, dude!”
I expected some hippie to show they’ve read a book and throw out “From each according to his ability, to each according to his need” Or at least, “Imagine alllll the people-le sharing all the world...”

Mags in
Friday, July 28 at 04:34 PM

JM-

The difference is that you own your dog and are responsible for its care. Wal-Mart and Target do not own their workers, nor are they responsible for how they make ends meet.

Someone in USA
Saturday, July 29 at 12:18 AM

Nor should a Wal-Mart employee ( they are truely not associates) be responsible for the company making its ends meet then.

You know that Wal-Mart would not agree with that statement.
They would say you are responsible.

Wal-Mart employees. You will never be treated fairly within this retailers system. You need a union to represent you.
Depending on the goodwill of store management and upward is NOT working.
Take your first step and inquire with a local about your rights.
Take in knowledge.
Be aware.

JM in USA
Saturday, July 29 at 07:38 AM

Hey Big T
You insult people by calling them uneducated. Those people probably have a greater education than 80% of the world. At what level does one cross the line and become educated?

JM in USA
Saturday, July 29 at 07:45 AM

It appears that individuals want to condemn the council for taking this action.  I congratulate them.
You want to say individuals are uneducated who want to “get” WM—that is not true.  I believe everyone wants decent wages and benefits from a retail store that does 200Billion plus a year.
You forget—our Congress just passed themselves a $15,000 dollar increase—nothing seems to stop them—why should American’s who have built this country not be giving at least an opportunity.

dm in Pittsburgh, PA
Sunday, July 30 at 08:07 AM

dm-

The measure is discriminatory, arbitrary, and economically unsound. It does nothing to help the poor working for businesses like McDonald’s that pay lower wages than big box stores but do not meet the area requirement. It costs the city jobs and low-priced goods because big box stores will be reluctant to enter the city. What is good about the law?

Furthermore, what obligation do Wal-Mart and Target have to pay a “living wage?” There are tens of thousands in the city willing to work for the market-generated pay they already offer. They pay a fair wage for the work done, and attempting to force them to pay more is extortion.

It is only out of envy and ignorance that one can look at a company with $316 billion in sales and say, “They should do more because they can.” The flaws of this reasoning are so obvious as to be trivial. First, the ability to pay a certain rate does not constitute the obligation to do so. Second, when you look at the fact that Wal-Mart only nets an $11.2 billion profit - just $6,222 annually per employee - you see that this is indeed unfeasible. The company makes very little when you consider how much it sells. It cannot afford to suddenly start paying these obscenely high wages you guys demand, certainly not on a national level. They are a for-profit business, not a charity.

I don’t know what you think Congress has to do with this. Wal-Mart has nothing to do with congressional pay. If you think that they should do something about it, write a letter. Wal-Mart is not a welfare program, either.

Someone in USA
Sunday, July 30 at 02:04 PM

Someone,

I think the concept of margin may be too sophisticated for these folks to grasp. I still haven’t heard a single rational argument for WalMart paying their employees more other than “they make billions in profit and they should just give it away to them.”

When I was maybe 6 or 7 I remember seeing my mom write a check at the store and asking her why doesn’t she just always use a check instead of paying with money? I couldn’t understand why you would hand over honest to goodness cash money when you could just write on this piece of paper and they would give you anything you wanted. I think that this is the mindset of the WalMart bashers on this site. They see 11 BILLION in PROFITS and think well, they could just divide that up and give it to the employees. Concepts like margin and cost of goods sold is waaayyy beyond them.

Mags in
Monday, July 31 at 10:31 AM

I want to start by saying “Bravo for bringing up McDonald’s, Wal-Greens, ect.” Now let me ask, “How many of you said ‘I want to be a Wal-Mart emplyee when I grow up.’” Bottom line I would not expect Wal-Mart to pay any more the minimum wages, but they don’t.  When I worked there I made $7.50 an hr. in a state that pays $5.15 minimum wage.  You wine about not getting breaks take it up with the labor board, they CAN"T legally fire you for that it is your right.  Not getting treated right?  Then go to college, get a degree, and do something that makes you happy as well as give you the pay you want.  Of course Wal-Mart associates work their fingers to the bone, so do McDonald’s employees.  And as far as going back to school, can the argument of no money, no time, can’t do it, because I have four children 6 and under, a full time job, and full time school.  It’s hard but with out a formal education I don’t EXPECT to make more then about $8 an hour.  Where have you been?  The harder you work (labor) the less you make.

Stephanie in Texas
Thursday, August 03 at 12:52 AM

I guess if they are going to pay a higher wage in Chicago that the reason they cut everybody hours from three to twelve hours a week in their Kennett mo. store.
We found this out today.
Management didn’t get a cut though.

Walter McGee in piggott, AR
Monday, August 07 at 06:19 PM

Commenting is not available in this content entry.

Comment Policy

WalmartWatch.com reserves the right, in its sole discretion, to remove or refuse to post blog comments.