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Wal-Mart Chief Defends Labor Practices Amid Union Criticism
Bloomberg News - April 5, 2005
By Lauren Coleman-Lochner
Wal-Mart
Stores Inc.'s chief executive officer told a group journalists that
the company is "great for America'' as unions and community groups
criticize it for treating workers unfairly.
CEO
Lee Scott and other executives addressed a group of about 50 journalists
at the company's first media day, held at the Embassy Suites hotel
in Rogers, Arkansas. Scott said Wal-Mart's full-time workers get
about $10 an hour, and of the 86 percent of employees with health
insurance, about half get the coverage through Wal-Mart, the world's
largest retailer.
"Some
well meaning critics contend that Wal-Mart should be setting the
pace for wages and benefits for the entire economy, just as a unionized
GM was said to have done in the post-war period, helping usher in
the great American middle class,'' said Scott. "The facts are that
retailing does not perform that same function in the economy as
GM does or did.''
Labor
unions and community groups last year helped to block the retailer
from opening stores in U.S. cities such as Chicago, arguing that
it drives down wages. The United Food and Commercial Workers Canada
won union certification in two stores while the company faces a
class action lawsuit claiming 1.6 million women were paid less and
offered fewer promotions than male employees.
Members
of the Coalition for a Better Inglewood, the California community
group that helped defeat a Wal-Mart store last year, held a press
conference at the hotel in Rogers calling on the company to sign
agreements guaranteeing fair wages and health coverage.
"They've
got a bad image and they need to clean up that image,'' said coalition
member and California Assemblyman Jerome E. Horton in an interview.
Scott
said new stores gain local support shortly after they open.
"Over
a relatively short period of time, people come to appreciate the
impact of having Wal-Mart in their community,'' he said.
The
retailer reported sales at U.S. stores open more than a year rose
3.3 percent last year, the smallest rise in more than a decade.
Total sales grew 11 percent to $285.2 billion.
Chief
Financial Officer Thomas Schoewe told the journalists that bad publicity,
or "headline risk,'' is a factor hurting the stock price.
Shares
of Wal-Mart rose 26 cents to $49.67 in New York Stock Exchange composite
trading at 4:18 p.m. They have fallen 15 percent in the past year.
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