| 80% of Wal-Mart Workers to Get a Bonus |
| Topic |
Incentives |
| Key Words |
Annual bonus programs, employee recognition |
| BCRC InfoMark |
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| News
Story |
Wal-Mart publicized its annual bonus program for employees for the first time in 20 years, saying that about 80% of workers in its retail stores would split more than a half-billion dollars.
Based on the number of employees Wal-Mart has overall, the average payment per employee would be $651, but Wal-Mart said that actual individual payment amounts vary. In the past, the bonus was $1,000 for full-time employees and $500 for part-time employees.
Wal-Mart spokesperson Sarah Clark said that the bonus is based on two main benchmarks: whether an employee’s store met profit and sales targets for the year and whether an employee is full time or part time.
Wal-Mart was also designating Thursday of this week as Associate Celebration Day. Many stores were hosting barbecues to celebrate, and Wal-Mart announced new programs intended to recognize service and performance.
Critics continue to say that Wal-Mart is doing too little for its employees, especially in comparison to the huge bonuses and pay packages that the company executives receive. CEO Lee Scott’s compensation for 2006 was $15.7 million, excluding restricted stock awards.
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| Questions |
| 1. |
Are you surprised to hear that Wal-Mart has a bonus program for its full and part-time store associates? List at least three benefits that Wal-Mart could receive from the program. |
| 2. |
What type of bonus program is Wal-Mart using for store associates? |
| 3. |
Do you agree with critics like those at WakeUpWalMart.com who say that the company is doing too little for its employees, in light of what company executives receive? Support your argument. |
| 4. |
Recently, Circuit City announced its decision to lay-off 3,400 high-paid store associates, and replace them with lower-paid workers. The laid-off employees will receive a severance package and can apply again for a job at Circuit City after 10 weeks at a lower rate of pay. Taking into consideration Wal-Mart’s attempts to improve conditions for its associates and the recent announcement at Circuit City, what do you think the future holds for retail employees when it comes to compensation? What trends will prevail in the next five or ten years? Be prepared to discuss your thoughts in class. |
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| Source
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“80% of Wal-Mart Workers to Get a Bonus,” The Buffalo News, March 23, 2007, pD6. |
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