Wal-Mart has been subject to criticism by various groups and individuals. Among these are some labor unions, community groups, grassroots organizations, religious organizations, environmental groups and Wal-Mart customers. They have protested against Wal-Mart, the company's policies and business practices.[1][2][3] Other areas of criticism include the corporation's foreign product sourcing, treatment of product suppliers, environmental practices, the use of public subsidies, and the company's security policies.[4] Wal-Mart denies doing anything wrong and maintains that low prices are the result of efficiency.[5][6][7]
In 2005, labor unions created new organizations and websites to influence public opinion against Wal-Mart, including Wake Up Wal-Mart (United Food and Commercial Workers) and Walmart Watch (Service Employees International Union). By the end of 2005, Wal-Mart had launched Working Families for Wal-Mart to counter criticisms made by these groups. Additional efforts to counter criticism include launching a public relations campaign in 2005 through its public relations website,[8] which included several television commercials. The company retained the public relations firm Edelman to interact with the press and respond to negative media reports,[9] and has started interacting directly with bloggers by sending them news, suggesting topics for postings, and sometimes inviting them to visit Walmart's corporate headquarters.[10]
Economists at the Cato Institute suggest that Wal-Mart is a success because it sells products that people want to buy at low prices, satisfying customer's wants and needs. However, Wal-Mart critics argue that Wal-Mart's lower prices draw customers away from other smaller businesses, hurting the community.[11][12]
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When Walmart plans new store locations, activists sometimes oppose the new store and attempt to block its construction. Opponents cite concerns such as traffic congestion, environment problems, public safety, absentee landlordism, bad public relations, low wages and benefits, and predatory pricing.[13][14][15][16][17] Opposition sometimes includes protest marches by competitors, informed citizens, activists, labor unions, and religious groups.[18][19][20] In some instances, activists demonstrated their opposition by causing property damage to store buildings or by creating bomb scares.[21][22] Some city councils have denied permits to developers planning to include a Walmart in their project. Those who defend Walmart cite consumer choice and overall benefits to the economy, and object to bringing the issue into the political arena.[23]
A Walmart Superstore opened in 2004 in Mexico, 1.9 miles away from the historic Teotihuacan archaeological site and Pyramid of the Moon.[24] Although Walmart's proposal received protest and media attention, the location was supported by Mexico's National Anthropology Institute, the United Nations, and the Paris-based International Council on Monuments and Sites.[25] Local merchants, helped by environmental groups and anti-globalization groups opposed the construction,[26] and poet Homero Aridjis joined the protest characterizing the opening as "supremely symbolic" and "...like planting the staff of globalization in the heart of ancient Mexico."[27]
Archaeologists oversaw construction and discovered a small clay and stone altar along with some other artifacts where the store's parking lot is now located.[24]
In 1998, Walmart proposed construction of a store off Charlotte Pike near Nashville, Tennessee. The building site was home to both Native American burial grounds and a Civil War battle site. Protests were mounted by Native Americans and Civil War interest groups, but the Walmart store was eventually constructed after moving graves and some modifications of the site so as not to interfere with the battlefield.[28] Civil War relics were also discovered at the site. The project developers donated land to permit access to the Civil War historic site.[29] The Indian burials were removed and re-buried.[28]
In 2005, developers tore down the long-closed Dixmont State Hospital in Kilbuck Township, Pennsylvania near Pittsburgh, with plans to build a shopping complex anchored by a Walmart on the site. While there were initially no general objections to Walmart itself, many residents didn't want to see Dixmont torn down, despite the fact that the Dixmont complex—having been abandoned in 1984—was beyond maintainable condition and teenagers were dangerously trespassing onto the property on a regular basis.[30] However, while the land was being excavated after the complex was torn down in order to create a plateau for the Walmart to sit on, a landslide covered Pennsylvania Route 65 and the railroad tracks in between PA 65 and the Ohio River, shutting down both routes for weeks. While Walmart did "stabilize" the landslide, many residents argued that Walmart merely stabilized the hillside so that it could continue with work to build the store.[31] Ultimately, in 2007 Walmart decided against developing the site, allowing the land to return to nature.[32] PA 65 remains restricted to one lane northbound near the site for safety concerns, though the entire roadway has since been cleared of debris. Despite this, Walmart is the largest retail chain in the Pittsburgh metropolitan area, and is the second-largest grocery store to locally-based Giant Eagle.
In May 2010, Walmart's US stores pulled its "Miley Cyrus" line of necklaces and bracelets, three months after the Associated Press informed the chain that the jewelry contained harmful amounts of the toxic metal cadmium. Long-term exposure to cadmium can lead to bone softening and kidney failure. It is also a known carcinogen, and research suggests that it can affect brain development in the very young. Cadmium in jewelry is not known to be dangerous if the items are simply worn, but concerns come when youngsters bite or suck on the jewelry, as many children do. Walmart said that while the jewelry is not intended for children, "it is possible that a few younger consumers may seek it out in stores." "We are removing all of the jewelry from sale while we investigate its compliance with our children's jewelry standard," Walmart said. The tainted jewelry was made at a Chinese manufacturer.[33]
Walmart has been accused of selling merchandise at such low costs that competitors have tried to sue it for predatory pricing (intentionally selling a product at low cost in order to drive competitors out of the market). In 1995, in the case of Walmart Stores, Inc. v. American Drugs, Inc., pharmacy retailer American Drugs accused Walmart of selling items at too low a cost for the purpose of injuring competitors and destroying competition. The Supreme Court of Arkansas ruled in favor of Walmart saying that its pricing, including the use of loss leaders, was not predatory pricing.[15] In 2000, the Wisconsin Department of Agriculture, Trade, and Consumer Protection accused Walmart of selling butter, milk, laundry detergent, and other staple goods at low cost, with the intention of forcing competitors out of business and gaining a monopoly in local markets.[16] Crest Foods filed a similar lawsuit in Oklahoma, accusing Walmart of predatory pricing on several of its products, in an effort to drive Crest Foods's own company-owned store in Edmond, Oklahoma out of business.[34] Both cases were settled out of court.
In 2003, Mexico's antitrust agency, the Federal Competition Commission, investigated Walmart for "monopolistic practices" prompted by charges that the retailer pressured suppliers to sell goods below cost or at prices significantly less than those available to other stores. Mexican authorities found no wrong-doing on the part of Walmart.[35] However, in 2003, Germany's High Court ruled that Walmart's low cost pricing strategy "undermined competition" and ordered Walmart and two other supermarkets to raise their prices. Walmart won appeal of the ruling, then the German Supreme Court overturned the appeal.[17] Walmart has since sold its stores in Germany.
Walmart has been accused of using monopsony power to force its suppliers into self-defeating practices. For example, Barry C. Lynn, a senior fellow at the New America Foundation (a think tank), argues that Walmart's constant demand for lower prices caused Kraft Foods to "shut down thirty-nine plants, to let go [of] 13,500 workers, and to eliminate a quarter of its products."[36] Kraft was unable to compete with other suppliers and claims the cost of production had gone up due to higher energy and raw material costs. Lynn argues that in a free market, Kraft could have passed those costs on to its distributors and ultimately consumers.[36]
For example, most Walmart store pharmacies fill many generic prescriptions for $4 for a month's supply. However, in California and ten other states, complaints from other pharmacies have resulted in Walmart being required to charge at least $9 for a month's supply of certain drugs.[37]
The 2010 remodelings of their smaller stores shifting emphasis away from non-grocery products towards carrying grocery items carried by their supercenters, has created a small backlash amongst some customers. The smaller and larger sizes in the adult clothing were discontinued as well as other available styles, forcing adult customers to look for clothing in the children's section, or shop with more expensive specialty "Big and Tall" stores for basic items such as jeans.
The incomplete labeling system of the Great Value product line, to the dismay of consumers, usually does not list location of manufacture of the product.
With close to two million employees worldwide, Walmart has faced a torrent of lawsuits and issues with regards to its workforce. These issues involve low wages, poor working conditions, inadequate health care, as well as issues involving the company's strong anti-union policies. Critics point to Walmart's high turnover rate as evidence of an unhappy workforce, although other factors may be involved. Approximately 70% of its employees leave within the first year.[38] Despite the turnover rate the company still is able to affect unemployment rates. This was found in a study by Oklahoma State University which states, "Walmart is found to have substantially lowered the relative unemployment rates of blacks in those counties where it is present, but to have had only a limited impact on relative incomes after the influences of other socio-economic variables were taken into account."[39]
The activist group Los Angeles Alliance for a New Economy (LAANE) said "in 2006 Walmart reports that full time hourly associates received, on average, $10.11 an hour." It further calculated that working 34 hours per week an employee earns $17,874 per year and claimed that is about twenty percent less than the average retail worker. (The number of hours the "average retail worker" worked was not specified.) The report from LAANE further opines that this pay is "over $10,000 less than what the average two-person family needs."[40] Walmart managers are judged, in part, based on their ability to control payroll costs. Some say this puts extra pressure on higher-paid workers to be more productive.[41]
By contrast, Walmart insists its wages are generally in line with the current local market in retail labor,[42] although direct comparisons are complicated because Walmart employs more part time workers, and the company's more extensive training, supervision, and automation provides opportunity to workers with little or no experience or skills, which may account for wage differences. Walmart grants "full time" benefits to those working as little as 34 hours per week, but does not limit workers to just 34 hours per week. The company does control labor costs by such ways as discouraging overtime, and by the use of "off the clock" labor. There have been numerous lawsuits against Walmart by former employees because of this problem.[43]
Other critics have noted that in 2001, the average wage for a Walmart Sales Clerk was $8.23 per hour, or $13,861 a year, while the federal poverty line for a family of three was $14,630.[44] Walmart founder Sam Walton once said, "I pay low wages. I can take advantage of that. We're going to be successful, but the basis is a very low-wage, low-benefit model of employment."[45]
In August 2006, Walmart announced that it would roll out an average pay increase of 6% for all new hires at 1,200 U.S. Walmart and Sam's Club locations, but the same time would institute pay caps on veteran workers.[46] While Walmart maintains that the measures are necessary to stay competitive, critics believe that the salary caps are primarily an effort to push higher-paid veteran workers out of the company.[46]
Because Walmart employs part-time and relatively low paid workers, some workers may partially qualify for state welfare programs. This has led critics to claim that Walmart increases the burden on taxpayer-funded services.[47][48] A 2002 survey by the state of Georgia's subsidized healthcare system, PeachCare, found that Walmart was the largest private employer of parents of children enrolled in its program; one quarter of the employees of Georgia Walmarts qualified to enroll their children in the federal subsidized healthcare system Medicaid.[49] A 2004 study at the University of California, Berkeley charges that Walmart's low wages and benefits are insufficient, and although decreasing the burden on the social safety net to some extent, California taxpayers still pay $86 million a year to Walmart employees.[50][51]
Walmart has also faced accusations involving poor working conditions of its employees. For example, a 2005 class action lawsuit in Missouri asserted approximately 160,000 to 200,000 people who were forced to work off-the-clock, were denied overtime pay, or were not allowed to take rest and lunch breaks.[52] In 2000, Walmart paid $50 million to settle a class-action suit that asserted that 69,000 current and former Walmart employees in Colorado had been forced to work off-the-clock.[52] The company has also faced similar lawsuits in other states, including Pennsylvania,[53] Oregon, and [54] Minnesota.[55] Class-action suits were also filed in 1995 on behalf of full-time Walmart pharmacists whose base salaries and working hours were reduced as sales declined, resulting in the pharmacists being treated like hourly employees.[56]
Walmart has also been accused of ethical problems. It is said that the Walmart employees are gender discriminated when trying to be hired and discriminated against in the work area. Duke vs. Walmart inc. was a discrimination case on behalf of more than 1.5 million current and former female employees of Walmart’s 3,400 stores across the United States. (9th circuit 2007) Dr. William Bliebly who evaluated Walmart’s employment policies "against what social science research shows to be factors that create and sustain bias and those that minimize bias” (Bliebly) and he finished by saying, the men and women not being created equal in the workforce is what Walmart is doing and what they should essentially not be doing.
On October 16, 2006, approximately 200 workers on the morning shift at a Walmart Super Center in Hialeah Gardens, Florida walked out in protest against new store policies and rallied outside the store, shouting "We want justice" and criticizing the company's recent policies as "inhuman."[57] This marks the first time that Walmart has faced a worker-led revolt of such scale, according to both employees and the company.[57] Reasons for the revolt included cutting full-time hours, a new attendance policy, and pay caps that the company imposed in August 2006, compelling workers to be available to work any shift (day, swing or night), and that shifts would be assigned by computers at corporate headquarters and not by local managers. Walmart quickly held talks with the workers, addressing their concerns.[57] Walmart asserts that its policy permits associates to air grievances without fear of retaliation.[58]
The 2004 report by U.S. Representative George Miller alleged that in ten percent of Walmart's stores, nighttime employees were locked inside, holding them prisoner.[59] There has been some concern that Walmart's policy of locking its nighttime employees in the building has been implicated in a longer response time to dealing with various employee emergencies, or weather conditions such as hurricanes in Florida.[60] Walmart said this policy was to protect the workers, and the store's contents, in high-crime areas and acknowledges that some employees were inconvenienced in some instances for up to an hour as they had trouble locating a manager with the key. However, fire officials confirm that at no time were fire exits locked or employees blocked from escape. Walmart has advised all stores to ensure the door keys are available on site at all times.[60]
In January 2004, The New York Times reported on an internal Walmart audit conducted in July 2000, which examined one week's time-clock records for roughly 25,000 employees.[61] According to the Times, the audit, "pointed to extensive violations of child-labor laws and state regulations requiring time for breaks and meals," including 1,371 instances of minors working too late, during school hours, or for too many hours in a day.[61] There were 60,767 missed breaks and 15,705 lost meal times.[61] Walmart’s vice president for communications responded that company auditors had determined that the methodology used was flawed, and the company "did not respond to it in any way internally."[61]
Walmart has been accused of allowing illegal immigrants to work in its stores. In one case, federal investigators say Walmart executives knew that contractors were using illegal immigrants as they had been helping the federal government with an investigation for the previous three years.[62] Some critics said that Walmart directly hired illegal immigrants, while Walmart claims they were employed by contractors who won bids to work for Walmart.[63]
On October 23, 2003, federal agents raided 61 Walmart stores in 21 U.S. states in a crackdown known as "Operation Rollback," resulting in the arrests of 250 nightshift janitors who were undocumented.[64] Following the arrests, a grand jury convened to consider charging Walmart executives with labor racketeering crimes for knowingly allowing illegal immigrants to work at their stores.[64] The workers themselves were employed by agencies Walmart contracted with for cleaning services.[64] Walmart blamed the contractors, but federal investigators point to wiretapped conversations showing that executives knew some workers did not have the right papers.[64] The October 2003 raid was not the first time Walmart was found using unauthorized workers. Earlier raids in 1998 and 2001 resulted in the arrests of 100 workers without documentation located at Walmart stores around the country.[65]
In November 2005, 125 alleged undocumented immigrants were arrested while working on construction of a new Walmart distribution center in eastern Pennsylvania.[66] According to Walmart, the workers were employees of Walmart's construction subcontractor.
In November 2009, Joseph Casias was fired from Walmart in Battle Creek, Michigan, for using medical marijuana. Joseph Casias was a cancer patient with a prescription for marijuana. WalMart spokesman Greg Rossiter claimed that Walmart policy is to terminate employees who take certain prescription medications, and he believed that this policy complied with the law. [67]
As of October 2005, Walmart's health insurance covered 44% or approximately 572,000 of its 1.6 million U.S. workers.[68] In comparison, Walmart rival and wholesaler Costco insures approximately 96% of its eligible workers, although Costco has been criticized by investors for its high labor costs. Walmart spends an average of $3,500 per employee for health care, 27% less than the retail-industry average of $4,800.[69] When asked why so many Walmart workers choose to enroll in state health care plans instead of Walmart's own plan, Walmart CEO Lee Scott acknowledged that some states' benefits may be more generous than Walmart's own plan: "In some of our states, the public program may actually be a better value - with relatively high income limits to qualify, and low premiums."[70] Critics of Walmart argue in Wal-Mart: The High Cost of Low Price that employees are paid so little they cannot afford health insurance.
According to a September 2002 survey by the state of Georgia, one in four children of Walmart employees were enrolled in PeachCare for Kids, the state's health-insurance program for uninsured children, compared to the state's second-biggest employer, Publix, which had one child in the program for every 22 employees.[71] A December 2004 nationwide survey commissioned by Walmart showed that the use of public-assistance health-care programs by children of Walmart workers was at a similar rate to other retailers' employees, and at rates similar to the U.S. population as a whole.[72]
On October 26, 2005, a Walmart internal memo sent to the firm's Board of Directors advised trimming over $1 billion in health care expenses by 2011 through measures such as attracting a younger, implicitly healthier work force by offering education benefits.[73] The memo also suggested giving sedentary Walmart staffers, such as cashiers, more physically demanding tasks, such as "cart-gathering," and eliminating full-time positions in favor of hiring part-time employees who would be ineligible for the more expensive health insurance and several policy proposals which may violate the Americans with Disabilities Act of 1990.[73] The memo also accused Walmart's lower paid employees of abusing emergency room visits, "possibly due to their prior experience with programs such as Medicaid," whereas such visits may actually be due to the reduced ability of uninsured or underinsured people to make timely appointments to see a regular physician.[73] Critics point to this internal memo as evidence that Walmart purports to be generous with its employee benefits, while in reality the company is working to cut such benefits by reducing the number of full-time and long-term employees and discouraging supposedly unhealthy people from working at Walmart.
On January 12, 2006, the Maryland legislature enacted a law requiring that all corporations with more than 10,000 employees in the state spend at least eight percent of their payroll on employee benefits, or pay into a state fund for the uninsured.[74] Walmart, with about 17,000 employees in Maryland, was the only known company to not meet this requirement before the bill passed. On July 7, 2006, the Maryland law was overturned in federal court by a U.S. District judge who held that a federal law, the Employee Retirement Income Security Act (ERISA), preempted the Maryland law. In his opinion, the judge said that the law would "hurt Walmart by imposing the administrative burden of tracking benefits in Maryland differently than in other states."[75] Similar legislation in Wisconsin days later was defeated in the state legislature.
On April 17, 2006, Walmart announced it was making a health care plan available to part-time workers after one year of service, instead of the prior two-year requirement.[76] One criticism of the new plan is that it provides benefit only after a $1,000 deductible is paid ($3,000 for a family). These deductibles may financially be out of reach for eligible part-time workers. Walmart estimates this change can add 150,000 workers to health coverage plans, if all who are eligible take part. By January 2007, the number of workers enrolled in the company's health care plans increased by 8%, which Walmart attributed to the introduction of less expensive insurance policies.[77] However, even with this increase, less than half of Walmart's employees, or 47.4%, received health insurance through the company, with 10%, or 130,000, receiving no coverage at all.[77]
In October 2001, a class action sexual discrimination lawsuit, Mauldin v. Walmart Stores, Inc., was filed against Walmart challenging the company's denial of health insurance coverage for prescription contraceptives. The lawsuit was certified for class action status, but later dropped by the plaintiffs in 2006 once Walmart agreed to change its health insurance policies.[78]
In March 2008, Walmart sued a former Walmart employee, Deborah Shank, to recover the money it spent for her health care after she was brain-damaged, restricted to a wheelchair, and nursing home-bound after her minivan was hit by a truck. Walmart sued the former employee for $470,000 after she received a settlement from the accident, citing that company policy forbids employees from receiving coverage if they also win a settlement in a lawsuit.[79] After a wave of bad publicity, Walmart dropped its suit.[80]
New, full-time Walmart associates must work at least six months before being eligible to purchase the company's primary health insurance.
Walmart has been criticized for its policies against labor unions. Critics blame workers' reluctance to join the labor union on Walmart anti-union tactics such as managerial surveillance and pre-emptive closures of stores or departments who choose to unionize.[81] Walmart states that it is not anti-union but, "pro-associate," arguing that its employees do not need to pay third parties to discuss problems with management as the company's open-door policy enables employees to lodge complaints and submit suggestions all the way up the corporate ladder.[82] In 1970, company's late founder Sam Walton resisted a unionization push by the Retail Clerks International Union in two small Missouri towns by hiring a professional union buster to conduct an anti-union campaign.[83] On the union buster's advice, Walton also took steps to show his workers on how the company had their best interests in mind, encouraging them to air concerns with managers and implementing a profit-sharing program.[83] A few years later, Walmart hired a consulting firm, Alpha Associates, to develop a union avoidance program.[83]
In 2000, meat cutters in Jacksonville, Texas voted to unionize and Walmart subsequently eliminated in-house meat-cutting jobs in favor of prepackaged meats on the claims that it cut costs and was a preventive measure to lawsuits.[84] Walmart claimed that the nationwide closing of in-store meat packaging had been planned for many years and was not related to the unionization.[84] In June 2003, a National Labor Relations Board judge ordered Walmart to restore the meat department to its prior structure, complete with meat-cutting, and to recognize and bargain with the union over the effects of any change to case-ready meat sales.[85]
Walmart's anti-union policies also extend beyond the United States. The documentary Wal-Mart: The High Cost of Low Price, shows one successful unionization of a Walmart store in Jonquière, Quebec (Canada) in 2004, but Walmart closed the store five months later because the company did not approve of the new "business plan" a union would require.[86][87] In September 2005, the Québec Labor Board ruled that the closing of a Walmart store amounted to a reprisal against unionized workers and has ordered additional hearings on possible compensation for the employees, though it offered no details.[88]
In March 2005, Walmart executive Tom Coughlin was forced to resign from its Board of Directors, facing charges of embezzlement.[89] Coughlin claimed that the money was used for an anti-union project involving cash bribes paid to employees of the United Food and Commercial Workers Union in exchange for a list of names of Walmart employees that had signed union cards.[89] He also claimed that the money was unofficially paid to him, by Walmart, as compensation for his anti-union efforts.[89] In August 2006, Coughlin pleaded guilty to stealing money, merchandise, and gift cards from Walmart, but avoided prison time due to his poor health. He was sentenced to five years probation and required to pay a $50,000 fine and $411,000 in restitution to Walmart and the Internal Revenue Service. A U.S. attorney has stated that no evidence was found to back up Coughlin's initial claims, and Walmart continues to deny the existence of the anti-union program, though Coughlin himself apparently restated those claims to reporters after his sentencing.[90]
Walmart has also had some run-ins with the German Ver.di labor union as well.[91] These issues, combined with cultural differences and low performing stores, led Walmart to pull out of the German market entirely in 2006.[92]
In August 2006, Walmart announced that it would allow workers at all of its Chinese stores to become members of trade unions, and that the company would work with the state-sanctioned All-China Federation of Trade Unions (ACFTU) on representation for its 28,000 staff.[93][94] However, the All-China Federation of Trade Unions has been criticized because it is the only trade union in China and as a tool of the government, ACFTU has been seen as not acting in the best interest of its members (workers), bowing to the government pressure on industry growth and not defending workers' rights.[95]
As a large customer to most of its vendors, Walmart openly uses its bargaining power to bring lower prices to attract its customers. The company negotiates lower prices from vendors. For certain basic products, Walmart "has a clear policy" that prices go down from year to year.[96] If a vendor does not keep prices competitive with other suppliers, they risk having their brand removed from Walmart's shelves in favor of a lower-priced competitor.[97] Critics argue that this pressures vendors to shift manufacturing jobs to China and other nations, where the cost of labor is less expensive.
In the mid-1990s, Walmart had a "Buy American" campaign. Yet by 2005, about 60% of Walmart's merchandise was imported, compared to 6% in 1995.[97] In 2004, Walmart spent $18 billion on Chinese products alone, and if it were an individual economy, the company would rank as China's eighth largest trading partner, ahead of Russia, Australia, and Canada.[98] One group estimates that the growing US trade deficit with China, heavily influenced by Walmart imports, is estimated to have moved over 1.5 million jobs that might otherwise be in America to China between 1989 and 2003.[99] According to the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO), "Walmart is the single largest importer of foreign-produced goods in the United States", their biggest trading partner is China, and their trade with China alone constitutes approximately 10% of the total US trade deficit with China as of 2004[update].[100]
While the company certainly imports many products, it points out that it purchases goods from more than 68,000 US vendors, spending $137.5 billion in 2004, and supporting more than 3.5 million supplier jobs in the US.[101]
Walmart has been criticized for not providing adequate supervision of its foreign suppliers. It has also been criticized for using sweatshops and prison labor. For example, in 1995, Chinese dissident Harry Wu charged that Walmart was contracting prison labor in Guangdong Province. However, Walmart says it does not use prison labor.[102] There have also been reports of teenagers in Bangladesh working in sweatshops 80 hours per week at $0.14 per hour, for Walmart supplier Beximco. The documentary film Wal-Mart: The High Cost of Low Price shows images of factories that produce goods for Walmart that appear in poor condition, and factory workers subject to abuse and conditions the documentary producers consider inhumane.
According to Walmart and many self-described advocates of free trade, comparisons of wage levels between vastly different countries is not a useful way to assess the fairness of a trade policy. The company also points out that wages paid to overseas workers are comparable to or exceed local prevailing wages. In that case, the company claims that the overseas manufacturing jobs it creates are often an improvement in the quality of life for its employees. They have also drawn attention to the fact that factory jobs with its suppliers are often safer and healthier than local alternatives, which may include prostitution, the drug trade, or scavenging.
Walmart currently uses monitoring which critics say is inadequate and "leaves outsiders unable to verify" conditions. Since Walmart will not release its audits or factory names, outside organizations are left to simply take Walmart's word.[103] Critics suggest an agency such as Social Accountability International or the Fair Labor Association should do the monitoring. In 2004, Walmart began working with Business for Social Responsibility, a San Francisco, California-based nonprofit organization, to reach out to groups active in monitoring overseas plants.[104]
In June 2006, Walmart was excluded from the investment portfolio of The Government Pension Fund of Norway, which held stock values of about US$ 430 million in the company, due to a social audit into alleged labor rights violations in Walmart operations in the United States, Canada, Latin America, Africa, and Asia.[105] Although Walmart did not respond to questions from the fund's auditors, it later claimed the decision "[doesn't] appear to be based on complete information".[106]
Walmart's product selection has been criticized by some groups in the past, primarily as viewed as a promotion of a particular ideology or as a response to its original rural, religious and conservative target market. In 2003, Walmart removed certain men's magazines from its shelves, such as Maxim, FHM, and Stuff, citing customer complaints regarding their racy content.[107] Later that year, it decided to partly obscure the covers of Cosmopolitan, Marie Claire, and Redbook on store shelves due to "customer concerns", and refused to stock an issue of Sports Illustrated's swimsuit special because it took exception to one photograph. It has also refused to sell the December 2011 issue of WWE Magazine due to its controversial cover depicting The Rock doused with fire.[108]
Since 1991, Walmart also has not carried music albums marked with the Recording Industry Association of America's (RIAA's) Parental Advisory Label (contradictory to the allowance of R-rated movies and video games rated Mature), although it carries edited versions of such albums, with obscenities removed or overdubbed with less offensive lyrics.[109] In one example in 2005, Walmart rejected the original cover of country singer Willie Nelson's reggae album, Countryman, which featured marijuana leaves, in an apparent pro-marijuana statement. To satisfy Walmart, the record label, Lost Highway Records, issued the album with an alternative cover, without recalling the original cover. Walmart has never carried Marilyn Manson albums, solely because of the controversy surrounding the group, but recently began selling Nine Inch Nails albums after rejecting them for years.[110] In fact, some albums that do not carry "Parental Advisory" stickers, include profanities and are not edited. Such albums include Pink Floyd's The Dark Side of the Moon and Arctic Monkeys' Whatever People Say I Am, That's What I'm Not. In 2009 Green Day refused to make an edited version of their album 21st Century Breakdown for Walmart, with frontman Billie Joe Armstrong claiming "You feel like you're in 1953 or something", thus the album is not carried by Walmart stores. However, Walmart's policy on carrying albums with the Parental Advisory Label seems to vary by country, as albums containing the label can be found in Canadian Walmart stores, for example.
In 1999, Walmart announced that it would not stock emergency contraception pills in its pharmacies, not citing any particular reasons except for a "business decision" that was made earlier.[111] The move was criticized by family planning advocates, citing that women in small towns where Walmart pharmacies had little competition would have greater difficulties in obtaining the drug.[111] The decision was challenged in 2006, as three Massachusetts women filed suit against the company after they were unable to purchase emergency contraception at their local Walmart stores,[112] resulting in a ruling that required Walmart to stock the drug in all of its pharmacies in Massachusetts.[112] Expecting that other states would soon do the same, Walmart reversed its policy and announced that it would begin to stock the drug nationwide,[112] while at the same time maintaining its conscientious objection policy, allowing any Walmart pharmacy employee who does not feel comfortable dispensing a prescription to refer customers to another pharmacy.[112]
Walmart has also been criticized for selling some controversial products. For example, in 2004 Walmart carried the anti-Semitic hoax[113] The Protocols of the Elders of Zion in its online catalogue and Walmart's online product description suggested the text might be genuine. The Jewish civil rights organization Anti-Defamation League wrote to the President of Walmart on September 2008 noting the text, "has been the major weapon in the arsenals of anti-Semites around the world," and called on Walmart to, "unequivocally state the nature of the book and to disassociate itself from any endorsement of it."[114] Walmart stopped selling the book shortly thereafter.
In October 2004, Walmart canceled its order for The Daily Show's America (The Book) after discovering a page that depicts each US Supreme Court judge nude. A week later, it returned copies of comedian George Carlin's When Will Jesus Bring the Pork Chops?, with a cover recreating The Last Supper with Jesus' seat empty and Carlin (an avowed atheist) seated next to it. The company claimed that the copies were shipped to it by mistake and a Walmart spokeswoman said she did not "believe this particular product would appeal" to its customer base.[115]
In January 2006, Walmart was criticized for the recommendation system on its website which suggested that some black-related DVDs, such as Introducing Dorothy Dandridge and documentaries on Baptist minister and civil rights leader Martin Luther King, Jr. were similar to the Planet of the Apes television series DVD box set. It quickly corrected the page, saying that it was a software glitch, but ultimately blamed the matter on human error.[116]
Until the mid-1990s, Walmart took out corporate-owned life insurance policies on its employees including "low-level" employees such as janitors, cashiers, and stockers. This type of insurance is usually purchased to cover a company against financial loss when a high-ranking employee (i.e. management) dies, and is usually known as "Key Man Insurance." Critics derided Walmart as buying what they called "Dead Peasants Insurance" or "Janitor Insurance." Critics, as well as the U.S. Internal Revenue Service, charge that the company was trying to profit from the deaths of its employees, and take advantage of the tax law which allowed it to deduct the premiums. The practice was stopped in the mid-1990s when the federal government closed the tax deduction and began to pursue Walmart for back taxes.[117]
On March 18, 2010 at the store in Washington Township, Gloucester County, New Jersey an announcement was made allegedly saying: "Attention Walmart customers - all black people leave the store now". Company spokesperson Ashley Hardie described the incident as 'unacceptable'.[118] Walmart has said they will change their policy with regard to who can have access to their public address system.[119] The intercom system at the particular store was modified to prevent such breaches in future.[120]
Two days later, on March 20, the suspect, a 16-year-old male, was arrested and charged with bias intimidation and harassment by Washington Township police.[121] It seems the youth is suspected of being the perpetrator in a similar but less substantiated earlier incident at the same store.[122]
The NAACP President for the state of New Jersey said the incident was a reminder we have a way to go before we arrive at 'decency and equality' but on the other hand the NAACP has acknowledged the steps Walmart has taken for diversity.[123]
In 2007, it was revealed that furniture sold at Walmart was made from wood which had been illegally logged in protected Russian habitats for Siberian tigers and other wildlife. Walmart promised to stop selling products that used wood from those areas, but not until the year 2013.[124]
On January 3, 2011 it was discovered that the entrance to one of the holding corporate buildings of Walmart Chile, had a plate in homage to Augusto Pinochet, ex Chilean dictator responsible of various human rights abuses[125], only after much controversy Walmart Chile decided to remove said plate.[126]
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