Wal-Mart. The High cost of "low" prices

I have decided that Wal-Mart is not a business that I really want to do business with.

Here's the outline:

A Substantial Number of Wal-Mart Associates earn below the federal poverty line

• In 2008, the average full time Associate (34 hours per week) earns $10.84 hourly for an annual income of $19,165. That’s $2,000 below the Federal Poverty Line for a family of four. [http://aspe.hhs.gov/poverty/08poverty.shtml]

• Last year, Wal-Mart CEO Lee Scott earned $29.7 million in total compensation, or 1,551 times the annual income of the average full time Wal-Mart Associate. [http://articles.latimes.com/2007/apr/20/business/fi-briefs20.6]

Wal-Mart Associates don’t earn enough to support a family

• The national median family budget for a family of four (two parents and two children) in 2005 was $39,984, more than twice the average full-time Associate’s annual income of $19,165. [Sylvia A. Allegretto, Basic family budgets: Working families' incomes often fail to meet living expenses around the U.S 2005]

Wal-Mart wages are not designed to support a family

• Wal-Mart spokesperson Mona Williams was quoted in 2004 for admitting that, "More than two thirds of our people... are not trying to support a family that’s who our jobs are designed for." [PBS Newshour, 23 August 2004]

Wal-Mart can afford wage increases

• Wal-Mart could give each of its workers a $1 per hour raise without affecting their annual $12 billion profit margin, by raising prices only one half of one penny per dollar. For instance, a $2.00 pair of socks would then cost $2.01. That half of a cent would add up to a $1,800 raise for each employee. [Analysis of Wal-Mart Annual Report 2005]

• A 2007 study found that Wal-Mart could increase its starting wage to $10 per hour, and even if were to pass 100 percent of the cost onto customers, it would only need to increase prices by 0.9%. This works out to $0.36 per shopping trip, or $9.70 per year, for the average Wal-Mart customer. [Arindrajit Dube, Dave Graham-Squire, Ken Jacobs, and Stephanie Luce, Living Wage Policies and Wal-Mart: How a Higher Wage Standard Would Impact Wal-Mart Workers and Shoppers 2007]

Wal-Mart’s wages are lower than other retail wages

• As of 2008, a full time Wal-Mart Associates earns 16% less than the average retail wage. [http://www.bls.gov/news.release/empsit.t16.htm]

• In 2008, a worker in Massachusetts at one of Wal-Mart’s leading competitors earns, on average, more than 15% more than Wal-Mart Associates. [Information acquired from fact-sheet on Wal-Mart’s Massachusetts operations from walmartfacts.com and contract cost information for UFCW Locals 328, 371, 1445, and 1459 master contracts with Stop & Shop]

• The average wage in 2008 at several of Wal-Mart’s retail competitors in Missouri are over 19% higher than the average wage at Wal-Mart. [Information acquired from fact-sheet on Wal-Mart’s Missouri operations from walmartfacts.com and contract cost information for UFCW Local 655 master contract with unionized supermarkets]

Wal-Mart and Health Care

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Wal-Mart's health care plan fails to cover nearly 700,000 employees

• Wal-Mart reports that its health insurance covers only 50.2% of their employees. Wal-Mart has nearly 1.4 million US employees. [UFCW analysis of Wal-Mart health plan, March 2008]

Wal-Mart's health care plan is too costly

• If an average full-time Wal-Mart employee chooses the least expensive family coverage plan, they would have to spend over 20% of their income before the health insurance provided any reimbursement.[ EBRI Issue Brief October 2007]

• An average full time Wal-Mart Associate faces a serious family health issue. They have to pay the entire out-of-pocket maximum for the least expensive health plan, which adds up to pay 53% of their income. [ EBRI Issue Brief October 2007]

Wal-Mart's health insurance falls far short of the industry average

• On average, large firms (1,000 or more workers) insure 65% of their employees. If Wal-Mart was to minimally reach the average coverage rate, Wal-Mart would cover an additional 210,000 workers. [ EBRI Issue Brief October 2007]

Wal-Mart forces employees to rely on public assistance to cover health care costs

• In 21 of 23 states where data is available, Wal-Mart forces more employees to rely on taxpayer-funded health care than any other employer. ["Disclosures of Employers Whose Workers and Their Dependents are Using State Health Insurance Programs, Good Jobs First, June 26, 2007]

Wal-Mart admits public assistance is a "better value"

• Despite over $12 billion in profits, President and CEO Lee Scott admits, "In some of our states, the public program may actually be a better value - with relatively high income limits to qualify, and low premiums". [Transcript Lee Scott Speech, 4 May 2005]

Costs to Taxpayers

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Your tax dollars pay for Wal-Mart's greed

• A 2004 estimate by the U.S. House Committee on Education and Workforce found that Wal-Mart's low wages cost taxpayers up to $2.5 billion a year in the form of federal public assistance programs. ["Everyday Low Wages: The Hidden Price We All Pay for Wal-Mart," A Report by the Democratic Staff of the Committee on Education and the Workforce]

• In 21 of 23 states where data is available, Wal-Mart forces more employees to rely on taxpayer-funded health care than any other employer. ["Disclosures of Employers Whose Workers and Their Dependents are Using State Health Insurance Programs," Good Jobs First 2007]

Your local Wal-Mart costs your community up to $420,000 per year

• These costs come in the form of many public assistance programs. A 2004 study found that one Wal-Mart store cost taxpayers $108,000/year for children's health care and $42,000 per year for low-income housing assistance. ["How Wal-Mart Has Used Public Money in Your State," Good Jobs First 2007]

Your tax dollars subsidize Wal-Mart's growth

• Wal-Mart has received over $1.2 billion in subsidies from state and local governments. ["How Wal-Mart Has Used Public Money in Your State," Good Jobs First , 2007]

• A Wal-Mart official stated that "it is common" for the company to request subsidies in "about 1/3 of all [retail] projects." This suggests that over a thousand Wal-Mart stores have received taxpayer subsidies, despite their $12 billion in profits in 2007. ["New Research Shows Wal-Mart Rigs the System to Skip Out on $2.3 Billion in State Taxes," Citizens for Tax Justice, 4/16/07]

• Through a loophole in many state tax codes, Wal-Mart avoided paying $2.3 billion in state income taxes between 1999 and 2005 alone. ["New Research Shows Wal-Mart Rigs the System to Skip Out on $2.3 Billion in State Taxes," Citizens for Tax Justice, 4/16/07]

Community Impact

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Wal-Mart drives down wages and increases poverty in communities

• A 2007 study found that the opening of a single Wal-Mart store lowers average retail wages in that county nearly 1%. In the general merchandise sector, wages fell by 1% for each new Wal-Mart. And for grocery store employees, the effect of a single new Wal-Mart was a 1.5% reduction in earnings. [Arindrajit Dube, T. William Lester, and Barry Eidlin, "A Downward Push: The Impact of Wal-Mart Stores on Retail Wages and Benefits," 2007]

• The average wage for retail workers is 10% lower than it would have been without Wal-Mart's presence. [Arindrajit Dube, T. William Lester, and Barry Eidlin, "A Downward Push: The Impact of Wal-Mart Stores on Retail Wages and Benefits," 2007]

• Nationwide, counties that had more Wal-Marts in 1987 and counties that saw more Wal-Marts built between 1987 and 1998 experienced greater increases in family-poverty rates during the 1990's. [Stephan J. Goetz and Hema Swaminathan, "Wal-Mart and County-Wide Poverty," 2006]

Money spent at Wal-Mart does not stay in the community

• In Virginia, for example, 60 cents of every dollar spent downtown, stays downtown--compared to just six cents for every dollar spent at a big-box stores like Wal-Mart. [Rocky Mountain Institute]

Wal-Mart negatively impacts the environment, traffic, and sprawl

• In October 2004, the United States Federal Government sued Wal-Mart for violating the Clean Water Act in 9 states, calling for penalties of over $3 million and changes to its building codes. ["Wal-Mart II Storm Water Settlement," EPA, 12 May 2004]

• A study of estimated additional driving costs to Wal-Mart Supercenters in the San Francisco Bay area estimated costs of up to $256 million to the community for infrastructure repair and environmental degradation. ["Supercenters and the Transformation of the Bay Area Grocery Industry: Issues, Trends, and Impacts," Bay Area Economic Forum, 2004]

Wal-Mart forced local small businesses to close

• Studies in Iowa showed that some small towns lost up to 47% of their retail trade after 10 years of a Wal-Mart store moving in nearby in the mid 1990's. [Kenneth E. Stone, "Impact of the Wal-Mart Phenomenon on Rural Communities," 1997]

Wal-Mart doesn't care what your community thinks

• In 2005, Wal-Mart real-estate manager Jeff Doss spoke about an oft-cited remark by company founder Sam Walton that Wal-Mart would not build stores in towns if the residents did not want them. "Were that the case," he said, "we'd never build a store anywhere". [Kenneth E. Stone, "Impact of the Wal-Mart Phenomenon on Rural Communities," 1997]

Wal-Mart and Imports

• 70% of the commodities sold in Wal-Mart are made in China. [China Business Weekly, November 29, 2004]

• Just because Wal-Mart bought goods from suppliers based in the United States does not mean that they were actually manufactured in the United States. In fact, Ray Bracy, Wal-Mart's vice president for federal and international public affairs, was asked, "Do you have any idea what percentage [of non-grocery, domestic sales] comes from overseas?" He responded, "What we don't know is the numbers of products that come from distributors or from manufacturers that they [sic] decide where to manufacture." Wal-Mart fails to track where their products are manufactured. [Frontline, 11/16/2004]

Wal-Mart and China

Download the Wal-Mart and China flyer - PDF

Wal-Mart buys most of its merchandise from China

• Over 80% of Wal-Mart's suppliers are based in China. ["China must tame economic dragon or face disaster" The Irish Times, 15 May 2008]

• In 2007 alone, Wal-Mart directly imported approximately $32 billion in merchandise from China. That's nearly 10% of all U.S. imports from China. ["Wal-Mart to push 1,000 Chinese suppliers to adopt green agenda" Financial Times, 7 April 2008] Note: This figure does not include purchases from other name brand suppliers who also source from China. If these suppliers were included, this number would be far higher.

• 70% of goods on Wal-Mart's shelves come from China. [China Business Weekly, November 29, 2004]

• As of 2008, if Wal-Mart was its own country, it would rank as the eighth largest importer of Chinese goods, ahead of Russia and India. ["US-China Trade Statistics and China's World Trade Statistics," US-China Business Council, 2008]

Many of Wal-Mart's "American Suppliers" actually manufacture most or all of their products in China

• One example of an "American supplier" is Hasbro, headquartered in Rhode Island. Today, Wal-Mart is the largest purchaser of Hasbro products—accounting for 24% of all Hasbro products or more than $900 million in sales. But Hasbro reports that "the substantial majority of our toy products are manufactured in China." [2008 Hasbro 10-K filed with the SEC ]

Wal-Mart's Chinese factory workers are treated poorly

• A 2008 report by the National Labor Committee found that workers making holiday ornaments for Wal-Mart in Guangzhou, China were paid only 2/3 of the legal minimum wage, often worked 95 hour weeks, and were forced to work for months without a single day off. The report also found that children as young as 12 worked in the factory and that workers handled dangerous chemicals without even the most rudimentary form of protection, leading to serious skin rashes and sores. ["A Wal-Mart Christmas: Brought to You by a Sweatshop in China," The National Labor Committee, December 2007]

Workers face appalling work conditions, despite Wal-Mart's factory inspection program

• As of early 2008, only 26% of Wal-Mart's factory inspections are unannounced, providing managers the opportunity to coach workers on what to say and hide violations. In contrast, 100% of the audits conducted by Target, one of Wal-Mart's chief competitors, are unannounced. [T.A. Frank, "Confessions of a Sweatshop Inspector," Washington Monthly, April 2008]

Wal-Mart and Worker Injuries

Wal-Mart cares little for the safety of its workers

• In 2005, the United States Court of Appeals for the District of Columbia Circuit has upheld a $5,000 fine against a Wal-Mart store in Hoover, Ala., for blocking emergency exits. The court upheld a decision by a judge who found that Wal-Mart was guilty of a serious and repeated offense. [New York Times, 5/17/05]

• According to New York Times report in 2004, Wal-Mart instituted a "lock-in" policy at some of its Wal-Mart and Sam's Club stores. The stores lock their doors at night so that no one can enter or leave the building, leaving workers inside trapped. Some workers reported that managers had threatened to fire them if they ever used the fire exit to leave the building. Instead, they were supposed to wait for a manager to unlock doors to allow employees to escape in an emergency. [New York Times 1/18/2004]

• The West Virginiastate workmen's comp agency placed Wal-Mart in an "adverse risk" pool because Wal-Mart had unusually high accident rates. [Charleston Gazette, 6/3/99]

Wal-Mart takes a combative approach to workers' compensation claims

• Arkansas Business in 2001 described Wal-Mart as "the state's most aggressive" when it comes to challenging worker's compensation claims. The company "stands far above any other self-insurer in challenges to employee claims." [Arkansas Business, 1/8/01]

Wal-Mart Non-Health Care Benefits

Download the Wal-Mart Non-Health Care Benefits flyer - PDF

Wal-Mart gives its managers and other non-hourly associates a disproportionate amount of its profit sharing, stock incentives, and other benefits

• According to Wal-Mart press releases, Wal-Mart salaried associates earned $207.6 million and $206.6 million in 2007 and 2006, respectively, towards their 401k and profit sharing plans. That’s about 23% of total contributions that go to managers and non-hourly associates.

• Wal-Mart’s annual report said the total stock compensation was $276 million in 2007, but Wal-Mart’s press release from May 1, 2008 said that only $50.1 million went to hourly employees. Therefore, $225.9 million, or 81.8%, of the stock purchase plan benefit went to non-hourly management and executives.[ Wal-Mart Stores, Inc. Annual Report, fiscal year ending January 31, 2007 and Wal-Mart press release May 3, 2007]

What Wal-Mart gave to hourly associates pales in comparison to what Wal-Mart gave to its top five executives.

• In 2006, the top five executives in Wal-Mart, made $62 million in stock options, incentive plans and other compensation. (This figure does not include their $4.6 million in salary.) This is equal to 8.7% of all the money Wal-Mart gave to its 1.39 million workers for employee stock purchases, profit sharing, and 401-k contributions.[ Wal-Mart Proxy Statement, for Fiscal Year Ending January 31, 2007, walmartfacts.com from December 2005 as in Brenner, Eidlen and Candaele, 2006, and Wal-Mart press release May 3, 2007]

• Former Wal-Mart CEO Lee Scott made $28.3 million in bonus and stock options and other compensation (excluding his salary) in 2006. This is equal to 3.9% of all the money Wal-Mart gave to its 1.39 million workers for employee stock purchases, profit sharing, and 401-k contributions. [Wal-Mart Proxy Statement, for Fiscal Year Ending January 31, 2007, Wal-Mart press release May 3, 2007, and walmartfacts.com from December 2005 as in Brenner, Eidlen and Candaele, 2006]

Wal-Mart’s statement on profit sharing highlights Wal-Mart’s low pay

• Wal-Mart says they historically contribute 2% of an associate’s pay for profit sharing and 2% for 401k. For 2007, Wal-Mart contributed $724.4 million to 838,955 hourly associates. Based on those figures, the average pay for an hourly associate was only $21,580 annually. [Wal-Mart press release May 3, 2007 and May 1, 2008]

The average profit sharing/401k contribution for all Wal-Mart employees was $517 dollars per worker in 2007.

• If Wal-Mart gave $724.4 million in profit sharing and 401k to its hourly workers in 2007 and Wal-Mart had about 1.4 million workers in the United States at the beginning of 2008, the average Wal-Mart associate received $517 in profit sharing and 401k contributions which amounts to a sad $1.42 per day for retirement. [Wal-Mart press release May 1, 2008]

• Wal-Mart gave $636.4 million in bonuses in 2007 to hourly associates. This averages to $758, or only $2.09 per day for retirement. [Wal-Mart press release May 1, 2008]

Wal-Mart Anti-Union Policy

Wal-Mart closes down stores and departments that unionize

• Wal-Mart closed its store in Jonquierre, Quebec in April 2005 after its employees received union certification. The store became the first unionized Wal-Mart in North America when 51 percent of the employees at the store signed union cards. [Washington Post, 4/14/05]

• In December 2005, the Quebec Labour Board ordered Wal-Mart to compensate former employees of its store in Jonquiere Quebec. The Board ruled that Wal-Mart had improperly closed the store in April 2005 in reprisal against unionized workers. [Personnel Today, 12/19/05]

• In 2000, when a small meatcutting department successfully organized a union at a Wal-Mart store in Texas, Wal-Mart responded a week later by announcing the phase-out of its in-store meatcutting company-wide. [Pan Demetrakakes, "Is Wal-Mart Wrapped in Union Phobia?" Food & Packaging 76 (August 1, 2003).]

Wal-Mart has issued "A Manager's Toolbox to Remaining Union Free,"

• This toolbox provides managers with lists of warning signs that workers might be organizing, including "frequent meetings at associates' homes" and "associates who are never seen together start talking or associating with each other." The "Toolbox" gives managers a hotline to call so that company specialists can respond rapidly and head off any attempt by employees to organize. [Wal-Mart, A Manager's Toolbox to Remaining Union Free at 20-21]

Wal-Mart is committed to an anti-union policy

• In the last few years, well over 100 unfair labor practice charges have been filed against Wal-Mart throughout the country, with 43 charges filed in 2002 alone.

• Since 1995, the U.S. government has been forced to issue at least 60 complaints against Wal-Mart at the National Labor Relations Board. [International Confederation of Free Trade Unions (ICFTU), Internationally Recognised Core Labour Standards in the United States: Report for the WTO General Council Review of the Trade Policies of the United States (Geneva, January 14-16, 2004)]

• Wal-Mart's labor law violations range from illegally firing workers who attempt to organize a union to unlawful surveillance, threats, and intimidation of employees who dare to speak out. ["Everyday Low Wages: The Hidden Price We All Pay for Wal-Mart," A Report by the Democratic Staff of the Committee on Education and the Workforce, 2/16/04]

Wal-Mart & Gender Discrimination

Wal-Mart discriminates against women

• In 2001, six women sued Wal-Mart in California claiming the company discriminated against women by systematically denying them promotions and paying them less than men. The lawsuit, Dukes v. Wal-Mart, has expanded to include more than 1.6 million current and former female employees, and was certified on June 21 2004 as the largest class action lawsuit ever. [Mondaq Business Briefing, November 1, 2004]

• In 2001, while more than two-thirds of Wal-Mart's hourly workers were female, women held only one-third of managerial positions and made up less than 15 percent of store managers. This is all despite women having had on average longer seniority and higher merit ratings than their male counterparts. [Neil Buckley and Caroline Daniel, "Wal-Mart vs. the Workers: Labour Grievances Are Stacking Up Against the World's Biggest Company,"" Financial Times 11, 11/20/03]

• In 2001, women managers on average earned $14,500 less than their male counterparts. Female hourly workers earned on average $1,100 less than male counterparts. [Drogin 2003]

• In 2001, for the same job classification, women earned from 5 percent to 15 percent less than men, even after taking into account factors such as seniority and performance. [Drogin 2003]

Wal-Mart & Child Labor

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Wal-Mart repeatedly broke child labor laws

• Wal-Mart agreed to pay $135,540 for breaking child labor violations charges in January 2005 in 24 separate incidents.["Wal-Mart Agrees to Pay Fine for Violating Child Labor Laws; Company Signs Settlement Agreement with Labor Department," February 14th, 2005, U.S. Newswire ]

• Wal-Mart was also fined $205,650 for 1,436 violations of child labor laws in Maine between 1995 and 1998. The settlement represents the largest number of citations as well as the largest fine ever issued by the Maine Department of Labor for child labor violations. [Weinstein, Joshua, "Wal-Mart fined $205,650 in child labor case", March 2, 2000, Portland Press Herald]

Wal-Mart got a sweetheart deal as part of their settlement

• In an unprecedented deal, the U.S. Department of Labor agreed to give Wal-Mart 15 days notice before visiting and/or investigating allegations of wage and hour violations, including failure to pay minimum wage or overtime. This move was called "very unusual," and according to former DOL official John R. Fraser, "appears to put Wal-Mart in a privileged position that... no other employer has." [Greenhouse, Steven, "Wal-Mart Agrees to Pay Fine in Child Labor Cases", February 12th, 2005, NY Times]

Wal-Mart's own internal audit found extensive child labor violations

• A 2000 internal Wal-Mart audit found "extensive violations of child labor laws and state regulations requiring time for breaks and meals." [Greenhouse, Steven, "In-House Audit Says Wal-Mart Violated Labor Laws," January 13th, 2004, NY Times]

• One week of time records for 25,000 employees in July 2000 found 1,371 instances of minors working too late, during school hours, or for too many hours in a day. There were 15,705 lost meal times and 60,767 missed breaks. [Greenhouse, Steven, "In-House Audit Says Wal-Mart Violated Labor Laws," January 13th, 2004, NY Times]

Wal-Mart continued to break child labor laws

• In June, 2005, despite the internal audit warning top Wal-Mart executives of broken child labor laws, Connecticut found 11 violations in three Wal-Mart stores in the state. The probe came after the Labor Department in February said the retailer had similar violations nationwide. [Greenhouse, Steven, In-House Audit Says Wal-Mart Violated Labor Laws, January 13th, 2004, NY Times]

Wal-Mart & Undocumented Immigrants

• In 2003, federal authorities arrested 250 undocumented immigrants who were employed by janitor contracting services and hired by Wal-Mart in 21 states. Many of the janitors - from Mexico, Russia, Mongolia, Poland and a host of other nations - worked seven days or nights a week without overtime pay or injury compensation. Those who worked nights were often locked in the store until the morning. [Wall Street Journal, 11/5/05, CNN Money, "Wal-Mart pays $11m over illegal labor", 2005]

• In March 2005, Wal-Mart agreed to pay $11 million to settle federal allegations it used undocumented immigrants to clean its stores. This was the largest immigration related fine ever levied. [CNN Money, "Wal-Mart pays $11m over illegal labor", 2005 and Wall Street Journal, 11/5/05]

• Federal immigration officers, in November 2005, arrested 125 undocumented workers in a raid at a Wal-Mart distribution center under construction north of Philadelphia. The workers from Costa Rica, El Salvador, Guatemala, Honduras and Mexico were detained Thursday at the site. [Associated Press, 11/18/05]

Wal-Mart & Port Security

WAL-MART IS AMERICA'S LARGEST IMPORTER OF PORT CONTAINERS

• For 2005, the year for which the most recent figures are available, Wal-Mart led the Journal of Commerce's annual Top 100 Importers rankings. Wal-Mart also led the list in 2004 and 2003. In 2005, Wal-Mart imported the equivalent of 695,000 20-foot equivalent container units (TEU). [Journal of Commerce, May 29, 2006 and Journal of Commerce, May 31, 2004]

• 
  The latest and most comprehensive figures available for comparing imports by various companies are from 2004. In 2004, as measured in 20-foot-equivalent container units (or TEUs), Wal-Mart was larger than Target, Sears/K-Mart and COSTCO combined (Journal of Commerce and the Port Import/Export Reporting Service).
  

  Figures for 2004

  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  

  1. Wal-Mart Stores	576,000
  2. The Home Depot	301,200
  3. Target Corp	202,700
  4. Sears/K-Mart	186,000
  5. Dole Food	171,300
  6. Chiquita Brands Intl	115,600
  7. Ikea Intl.	100,000
  8. Lowes Cos.	100,000
  9. Heineken USA	83,400
  10. Costco Wholesale	66,400

  
  [All Business, Oct 28, 2005]
  
  

A WAL-MART CONTAINER ARRIVES IN THE U.S. AT A RATE OF 1 EVERY 45 SECONDS.

• One of every 25 containers shipped to the United States in 2005 was destined for Wal-Mart. At that ratio, Wal-Mart's imports accounted for 695,118 cargo containers that year, with an average of one arriving to a U.S. port every 45 seconds. [Forbes, 7/5/06]

SINCE 9/11, AMERICA'S PORT'S REMAIN VULNERABLE BY ONLY INSPECTING ABOUT 5 TO 6 PERCENT OF CARGO CONTAINERS COMING INTO OUR PORTS

• Incredibly, even after 9/11, our nation's ports remain vulnerable since only a small fraction of containers imported into the United States are actually scanned. As Senator Robert Menendez stated publicly last year, "only 5 percent of the containers passing through our ports are scanned." [Sen. Robert Menendez, April 25, 2006]

• Even at some of the busiest ports in America, for example Long Beach and Los Angeles Harbors, only about 6% of the containers they carry are selected to be scanned on the docks with X-ray machines and hand-held radiation detectors, officials say. Then about 6% of those are selected to be unloaded for inspection at customs facilities. [Los Angeles Times, September 11, 2006]

MEMBERS OF CONGRESS AGREE THE RISK TO PORT SECURITY COULD LEAD TO THE 'NIGHTMARE' SCENARIO

• U.S. Rep. Jerrold Nadler: "All it takes is one atomic or radiological bomb to make 9/11 look like a firecracker [and] to bring commerce to a total halt for weeks or months while every ship is searched by hand because we don't have in place the means to scan every container. That is what this motion [to mandate 100% scanning] is about. If we really want to make this country safer, we must demand that before any container is put on a ship bound for the United States it must be scanned electronically in the foreign port." [Jerrold Nadler, floor debate, 5/4/06]

• U.S. Rep. Ed Markey: "Now, why is [100 percent scanning of cargo] important? It is important because of all of the unsecured nuclear material in the former Soviet Union that al Qaeda can purchase, take to a port in Europe, in Asia, in Africa, and then, with a piece of paper and an ID, waive on a 10,000 or 20,000 or 30,000 pound container and, with the nuclear bomb inside of it, send that ship, that container, right to a port in the United States, to New York, to Boston, to California, to any other city in America, without being screened." [Ed Markey, floor debate, 5/4/06]

• Sen. Charles Schumer: Concluding his comments on adopting technology used at one Hong Kong port which scans 100 percent of containers, Schumer said, "My nightmare, Mr. Chairman, has been, ever since 9/11, that somebody somehow smuggles a nuclear weapon into one of our cities -- not just a dirty bomb, but a real nuclear weapon. ... It's worth a little extra effort and a few extra dollars to make sure that doesn't happen." [Charles Schumer, Press Conference, 4/25/06]

PORT SECURITY EXPERTS HAVE OUTLINED THE THREAT OF UNSCANNED CONTAINERS

• "We're living on borrowed time," said Jerry Hultin, president of New York's Polytechnic University and a former Clinton administration Navy undersecretary who studies port security. "The ports have become a very appealing target." [Knight Ridder Washington Bureau, February 23, 2006]

• "'In terms of maritime security, have people done things? Yes,' said retired Coast Guard Cmdr. Stephen E. Flynn, a consultant and expert on port security. 'But are we keeping pace with terrorists' capabilities and the potential consequences five years after 9/11? The answer is no.'" "A key vulnerability, Flynn and others say, remains the ubiquitous cargo container, the mainstay of international commerce and a potential Trojan horse in the age of terrorism." [Los Angeles Times, September 11, 2006]

• "In August 2006, the Rand Corporation released a report concluding that 'a nuclear explosion at the Port of Long Beach could kill 60,000 people immediately, expose 150,000 more to radiation and cause 10 times — 10 times the economic loss of the September 11th attacks.'" [Los Angeles Times, September 11, 2006]

IGNORING THIS THREAT, WAL-MART LOBBIES MEMBERS OF CONGRESS TO RESIST TIGHTENING PORT SECURITY

• Even with the tragedy of 9/11 still fresh in our minds, Wal-Mart and its retail lobby group, the Retail Industry Leaders Association (RILA), are lobbying Members of Congress to oppose 100% scanning of port containers.

• The Wall Street Journal, in a "Washington Wire" blurb March 24, 2006 made it clear: "Wal-Mart resists efforts in Congress to dramatically tighten port security in wake of Dubai-ports furor. The company argues examining all containers or even a fixed percentage of them could impede shipping and boost costs." [Wall Street Journal, 3/24/06]

• "Wal-Mart and other big businesses have been lobbying against 100-percent scanning, alleging that it will slow their massive import operations." [US Fed News, 4/26/06]

• The Retail Industry Leaders Association (RILA), since the attacks of Sept. 11, 2001, have consistently opposed new maritime and port security rules. Their mantra is: "Security requirements should not become a barrier to trade."[AFL-CIO, Unchecked How Wal-Mart Uses Its Might to Block Port Security," April 2006]

• RILA sent a letter to all members of the U.S. House of Representatives opposing Congress's attempt to mandate "100 percent scanning." [Retail Industry Leaders Association, press release, 1/8/07]

WAL-MART USES RILA AS AN ANTI-SECURITY LOBBYING ORGANIZATION

• Wal-Mart is a key member of the Washington, D.C. lobbyist group the Retail Industry Leaders Association (RILA).

• Finally, Wal-Mart, RILA and two Wal-Mart-connected law firms—Sandler Travis and Strasburger & Price—hold seats on Customs' Commercial operations Advisory Committee (CoAC), a group of retailers, shippers and lobbyists who ensure that national security demands do not obscure the need for efficiency in the supply chain. RILA's and Wal-Mart's seats on the committee and subcommittees give them a chance to weaken supply chain security measures such as the Maritime Transportation Security Act, which they were unable to defeat in Congress. [AFL-CIO, Unchecked How Wal-Mart Uses Its Might to Block Port Security," April 2006]

WAL-MART AND RILA: PUTTING PROFITS BEFORE AMERICAN SECURITY

• The following is RILA's public warning to Congress from March 2006 that it should not put protection of our ports ahead of profits: "[M]ove cautiously and with careful deliberation before considering any new legislation related to the security of our nation's seaports or commercial cargo....Congress should be careful to avoid measures that would harm global supply chain efficiency or unnecessarily delay the movement of food and cargo." [AFL-CIO, Unchecked How Wal-Mart Uses Its Might to Block Port Security," April 2006]

• RILA boasted in its 2005 lobbying report to Wal-Mart and other members about its "continued industry leadership in opposition to ill-advised and onerous port security measures (i.e., cargo fees, increased physical inspections)." In fact, beating back meaningful port security measures topped RILA's agenda. [The New Yorker, 6/19/06]

• RILA's top trade lobbyist on post-Sept. 11 safeguards in a 2002 Washington Post story: "We are the industry driving the U.S. economy... Any increased delays or costs would really impact" retailers such as Wal-Mart. [AFL-CIO, Unchecked How Wal-Mart Uses Its Might to Block Port Security," April 2006]

• RILA is a founder of the Waterfront Coalition, another retail industry lobby group dedicated to improving "the productivity, efficiency and through-put" of U.S. ports. RILA and the Waterfront Coalition collaborated in 2005 on a container transportation policy paper that runs to nearly 50 pages but says nothing—not one word—about supply-chain security. [AFL-CIO, Unchecked How Wal-Mart Uses Its Might to Block Port Security," April 2006]

• RILA warned Congress in 2004 that x-rays of shipping containers at U.S. ports would "cause major delays" for their goods, although a 100-percent container x-ray system in Hong Kong's busy port won praise from security experts. [AFL-CIO, Unchecked How Wal-Mart Uses Its Might to Block Port Security," April 2006]

PORT SECURITY EXPERTS DISPUTE THE POTENTIAL COST TO WAL-MART

• According to Stephen Flynn, retired Commandant of the U.S. Coast Guard and senior fellow on national security Council on Foreign Relations: "The total cost of third party compliance inspections, deploying 'smart' containers, and operating a cargo scanning system such as the one being piloted in Hong Kong [100 percent scanning] likely reach $50 to $100 per container depending on the number of containers an importer has and the complexity of its supply chain. ... Can industry afford the cost of this regime? Even if the final price tag came in at $100 additional cost per container, it would raise the average price of cargo moved by Wal-Mart or Target by only .2 percent. [Congressional Quarterly, March 28, 2006]

WAL-MART USES MONEY AND INFLUENCE TO PRESSURE POLITICIANS TO OPPOSE STRENGTHING PORT SECURITY

• Wal-Mart's and RILA's recent investments in members of Congress with power over port and supply-chain security issues are massive and tilt heavily to Republicans.

• As of 2006, Wal-Mart had given $191,500 to current House Homeland Security Committee members since 2000—all but $9,500 of that since the September 2001 attacks. [AFL-CIO, Unchecked How Wal-Mart Uses Its Might to Block Port Security," April 2006]

• In the 109th Congress, eighteen of the committee's nineteen Republican members took in $173,000—90 percent of the total—and four of the committee's fourteen Democrats collected $18,500. [AFL-CIO, Unchecked How Wal-Mart Uses Its Might to Block Port Security," April 2006]

• In the past eight years, Wal-Mart's Washington Political Action Committee put more than $360,000 into current members of the powerful House Ways and Means Committee. In the 109th Congress, twenty-three of the committee's 24 Republicans took Wal-Mart's money—82 percent of the total—compared to only eight of the committee's 17 Democrats. [AFL-CIO, Unchecked How Wal-Mart Uses Its Might to Block Port Security," April 2006]

• Wal-Mart also has spent $63,000 on current members of the Senate Committee on Homeland Security and Governmental Affairs in the past eight years—more than two-thirds of that since September 2001. Ninety-six percent of Wal-Mart's spending went to the committee's Republican members. [AFL-CIO, Unchecked How Wal-Mart Uses Its Might to Block Port Security," April 2006]

• The Bush administration released its 2007 homeland security budget proposal at the height of the Dubai Ports World debate, eliminating grants to improve port security and increasing the C-TPAT budget by a mere 1.3 percent—a cut in real terms from the program's 2006 budget request. [AFL-CIO, Unchecked How Wal-Mart Uses Its Might to Block Port Security," April 2006]

WAL-MART USES LOBBYISTS WHO HAVE CLOSE TIES TO THE DEPARTMENT OF HOMELAND SECURITY

• Robert Bonner, former top Homeland Security official, went to work for one of Wal-Mart's Washington lobbyists in 2005. [AFL-CIO, Unchecked How Wal-Mart Uses Its Might to Block Port Security," April 2006]

• Asa Hutchinson left his job as under secretary of the Department of Homeland Security to lobby for companies on security issues at Venable, one of Washington's oldest lobbying law firms and another of Wal-Mart's Washington partners. [AFL-CIO, Unchecked How Wal-Mart Uses Its Might to Block Port Security," April 2006]

• Hutchinson was connected to Wal-Mart long before he took the nation's No. 2 security post. In his brief stint as congressman from Arkansas' Third Congressional District—home to Bentonville and Wal-Mart's global headquarters—Hutchinson had taken more than $12,500 from Wal-Mart's Political Action Committee, and at least $7,000 more from top Wal-Mart executives and Walton family heirs. Wal-Mart's previous CEO, David Glass, has been a long-time patron to Hutchinson. [AFL-CIO, Unchecked How Wal-Mart Uses Its Might to Block Port Security," April 2006]

• Hutchinson's brief tenure at the Department of Homeland Security saw the creation of Customs' voluntary supply-chain security program and a controversial decision not to bring criminal charges against Wal-Mart for its abuse of illegal immigrants hired to clean its stores. The workers' lawyer said, "They generally worked seven nights a week, 364 days a year, and they were often locked in the stores." Wal-Mart instead was fined $11 million. Wal-Mart even denied being fined, calling the payment "voluntary." [AFL-CIO, Unchecked How Wal-Mart Uses Its Might to Block Port Security," April 2006]

Wal-Mart and Wage Law Violations

Download the Wal-Mart and Wage Law Violations flyer - PDF

There are 76 class action lawsuits alleging wage-and-hour violations at Wal-Mart

• Wal-Mart reported in December 2008 that the company was involved in at least 76 class action lawsuits alleging wage-and-hour violations. [Wal-Mart Stores, Inc. SEC Form 10-Q, filed 12/9/08] According to The New York Times, the suits include allegations Wal-Mart forced "employees to work unpaid off the clock, eras[ed] hours from time cards and prevent[ed] workers from taking lunch and other breaks that were promised by the company or guaranteed by state laws." [New York Times, 12/24/08]

Wal-Mart's settlement is worth little to workers and less to the company

• According to The New York Times, Wal-Mart announced it would settle 63 of the outstanding class action suits over wage-and-hour violations for an amount between $352 million and $640 million. [New York Times, 12/24/08] This leaves the average Wal-Mart worker as little as $250 and only as much as $450. [Calculations based on Wal-Mart's 3rd quarter 2008 sales disclosed on Form 10-Q, filed 12/9/08]

• Wal-Mart's settlement represents company sales for a mere 14 hours and 10 minutes.[Calculations based on Wal-Mart's 3rd quarter 2008 sales disclosed on Form 10-Q, filed 12/9/08]

Wal-Mart's Minnesota settlement is a raw deal for local workers

• Wal-Mart settled a Minnesota wage-and-hour lawsuit for $54 million. Had Wal-Mart continued with the penalty phase of the trial, they could have owed over $2 billion in penalties to the State of Minnesota. [New York Times, 12/9/08]

• One plaintiff, Nancy Braun, wasn't allowed bathroom breaks while working as the only server and cook at an in-store restaurant. As a result, Ms. Braun "ended up soiling herself several times." [New York Times, 12/9/08]

• Wal-Mart's $54 million settlement represents the company's profit in the last 37 hours and 10 minutes. [Calculations based on Wal-Mart’s 3rd quarter 2008 sales disclosed on Form 10-Q, filed 12/9/08]

Wal-Mart is still appealing $380 million in awards to workers in Pennsylvania and California

• Wal-Mart is still appealing verdicts in two cases. In California, Wal-Mart is appealing a $192 million award for not providing employees "meal and rest breaks in accordance with California law." And in Pennsylvania, Wal-Mart has appealed a $188 million award for similar offenses. [Wal-Mart Stores, Inc. SEC Form 10-Q, filed 12/9/08]

Wal-Mart's claim that it's a changed company is betrayed by very recent lawsuits

• Two class action suits were filed as recently as the fall of 2008, and the Minnesota class action suit was accepting new plaintiffs the month before the settlement. [New York Times, 12/9/08]

• Ironically, Wal-Mart's general counsel Tom Mars told The New York Times that many of the suits were old and "are not representative of the company we are today." [New York Times, 12/24/08]

I will now start shopping with locally owned and managed businesses. If I need Hardware, I will go to Ace Hardware, If I need Groceries, I will buy From Grocery Outlet or Food World. If I need clothes I will go to Yancey Parkers, Or Penney's. etc, etc, etc. It may cost a little more, but the service and quality is worth it. Adios Wal-Mart, I really don't need you!

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