Walmart Hikes Minimum Wage, Then Quietly Lays Off Thousands Of Workers

Walmart closed at least 63 of its Sam's Club stores on the very same day as it announced to increase the minimum wage for hourly employees to $11.


Walmart basked in praise after it announced its decision to not only increase the minimum wage for hourly employees to $11 but also to provide bonuses of up to $1,000 to its employees following the recent corporate cuts in the Republican tax plan.

“Tax reform gives us the opportunity to be more competitive globally and to accelerate plans for the U.S.,” Walmart CEO Doug McMillon said in a statement. “We are early in the stages of assessing the opportunities tax reform creates for us to invest in our customers and associates and to further strengthen our business, all of which should benefit our shareholders. However, some guiding themes are clear and consistent with how we've been investing — lower prices for customers, better wages and training for associates and investments in the future of our company, including in technology.”

Sounds nice, right?

Well, apart from the fact those bonuses were only meant for employees who had been working at the company for 20 years — a benchmark that makes most Walmart workers ineligible — the news about wage hike was supposed to distract the public and media from very disturbing news.

Walmart closed at least 63 of its Sam's Club stores — a chain of retail warehouse clubs owned and operated by the corporate giant — across the country on the very same day. What’s even worse is that they did it with out giving advance warning to most of its employees, many of whom reportedly showed up to work only to find the doors closed.


“After a thorough review of our existing portfolio, we’ve decided to close a series of clubs and better align our locations with our strategy,” the company said. “Closing clubs is never easy and we’re committed to working with impacted members and associates through this transition.”

The unexpected closure is likely to affect thousands of employees, as each location reportedly had at least 150 workers.

“FedEx showed up at my door with a package from Sam's Club and I was thinking that maybe it was my W-2,” Nic Townsend, an employee of a Sacramento Sam's Club, told the Business Insider. "It was a letter saying they are closing down... I'm unsure of what to do I have a baby and a mentally sick mother. I'm lost. I'm heartbroken. I'm scared.”

However, the retail giant claimed it would accommodate the laid off employees at its newly opened warehouses and other stores.

The news about the layoffs, which Walmart apparently tried to downplay by announcing the bonuses, was met with severe criticism.

“While pay raises are usually a good thing, this is nothing but another public relations stunt from Walmart to distract from the reality that they are laying off thousands of workers and the ones who remain will continue to receive low wages,” said activist Randy Parraz, director of Making Change at Walmart, an affiliate for United Food and Commercial Workers Union.

Meanwhile, the White House only took time out to comment on Walmart’s wage hike, completely ignoring the closure of dozens of Sam’s Club locations.

“Walmart is the largest employer in the country and to see them make that kind of effort to over a million workers is a big deal... and I think further evidence that the tax reform and tax cut package are having the impact that we had hoped,” White House press secretary Sarah Sanders told reporters.




Thumbnail/Banner Credits: Walmart via Reuters

View Comments

Recommended For You