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Case Study of Wal –Mart Stores Inc.,U.S.
PRESENTED IN NATIONAL CASE WRITING COMPETITION-BVMIR09 , BY:
Dr. Namita Rajput Preeti Sahni
Associate Professor Sri Aurobindo College University Of Delhi
Lecturer Bharati College University of Delhi
ETHICAL BUSINESS CALL OF TODAY
There is a need do business with an open eye,
continuously measuring & evaluating the consequences & impact of actions taken . This obligation is seen to extend beyond the statutory obligation to comply with legislation and seeing organizations voluntarily taking further steps to improve the quality of life for employees and their families as well as for the local community and society at large.
SURVIVAL IS FOR ONLY ETHICAL ORGANISATIONS The companies that survive are the ones that can spot ethical issues and correct them before they become problems . .
GIANT MONSTER OF US ECONOMY EATING THE DREAMS OF PEOPLE .
Wal-Mart eventually became the world's largest retailer . Arkansas.WAL-MART The first true Wal-Mart opened in 1962 in Rogers.
6 million in sales. there were 24 Wal-Mart stores in Arkansas ringing up $12. 1968 saw the hiring of Wal-Mart Aviation‟s first full-pilot. who provided help to Sam and Bud Walton. and Claremore. Today. Mo. The company officially incorporated as Wal-Mart Stores Inc. 7. Okla. in Sikeston. serving more than 200 million customers per year. 1969. .390 Wal-Mart stores and Sam‟s Club locations in 14 markets employ more than 2 million associates. Five years later. as well as the opening of the first stores outside of Arkansas. when Sam Walton opened the company‟s first discount store in Rogers. Ark. on October 31.Company profile and history The Wal-Mart story began in 1962..
Wal-Mart is considered to be the biggest company in the U. .S. Wal-Mart. the place where a lot of people usually do their shopping for the low prices and the variety of products was founded by Sam Walton. In fact. started his own company and made it into the leader in discount retailing that it is today. the big giant. and it has stores worldwide . Walton was an entrepreneur with an innovative vision.
The wal-mart culture rests upon 3 basic beliefs which are: Respect for the Individual Service to customer Striving for excellence .
In fact.S. Wal-Mart likes to portray itself as a seller of U.org) In addition. As a matter of fact.pbs.According to PBS: “Wal-Mart employs more people than any other company in the United States outside of the Federal government. this big giant is facing a significant amount of controversy for unethical business practices. some of these unethical business practices include the following. Wal-Mart has forced many manufacturers out of business.”(www. It would seem that Wal-Mart encourages “made in the USA” but it really encourages products made outside the USA. manufactured goods but in reality the company has products on its shelves made in foreign countries and at questionable workshops. As a result. . yet the majority of its employees with children live below the poverty line.
GIANT UNETHICAL CORPORATION OF AMERICA .
So. . with an open mind.UNETHICAL PRACTICES OF WAL-MART Open door policy as against labour union Wal-Mart is a non union organization that feels it does not need third party intervention. or simply getting an answer to a question. According to this policy the door of the management is always open for the associates to share suggestions. ideas. Whether it‟s help with a problem. Instead of unions. Managers also treat all discussions fairly. and without bias. whenever it‟s possible. Wal-Mart has an open door policy that encourages employees to take their complaints beyond management. They work with the associates to mutually resolve any issues or problems. guidance or direction. and voice concerns. They maintain complete confidentially.
4) Wal-Mart provides managers with its infamous „Manager‟s Toolbox to Remaining Union Free‟ that states: “Staying union free is a full time commitment. Unless union prevention is a goal equal to other goals and objectives in the organization. . management will not devote the necessary day in.” If there is any evidence of moves towards unionisation. managers are ordered to phone the Wal-Mart Union Hotline immediately. 3) Its anti-union policy is a central part of its obsession with minimising costs. 2) Employees start out at lower wages than unionized corporations and end up quitting by the end of the first year. day out attention and effort.Analysis of open door policy: 1)The open door policy does little to help its employees but gives the business the leverage it needs to terminate unwanted non compliant help.
It confirms what Wal-Mart workers have been saying for years.Statement From “Human Right Watch 2007” A report entitled Discounting Rights released by Human Rights Watch in May. 2007 outlines the systematic denial of WalMart workers’ right to organize. Workers seeking a voice on the job with the United Food and Commercial Workers Union have faced: .
or lose benefits if they try to form a union. Wal-Mart routinely monitors and spies on union organizers and prounion employees and selectively enforces company policies against pro-union workers. or has shut down stores and units where workers have organized. . employers are not allowed to discourage employees from forming a union for they have that right.Un Ethical And Aggressive policies of Wal-Mart Wal-Mart works aggressively to create a climate of fear and intimidations where workers fear they’ll be fired. When workers have successfully organized. WalMart has refused to bargain. It is unethical for Wal-Mart to prohibit employees to talk to union representatives since according to the National Labour Relations Act. disciplined. Wal-Mart engages in “unit packing” and other tactics to prevent organizing efforts. Wal-Mart also prohibits employees from talking to union representatives.
labor unions also created new organizations and websites to influence public opinion against WalMart. filed with the National Labour Relations Board.Violated Federal Labour Law By "Bribing" Employees To Report On Co-workers Who Favoured A Union. In 2005. including Wake up Wal-Mart (United Food and Commercial Workers) and Wal-Mart Watch (Service Employees International Union). employees to report on co-workers who favoured a union. “The complaint. the United Food and Commercial Workers Union filed a complaint with the National Labour Relations Board against Wal-Mart. But Wal-Mart denied the charges that were brought against the company. . . alleges that Wal-Mart violated federal labour law by "bribing“. Therefore.
In addition. if Wal-Mart takes more seriously the employees’ complaints. If WalMart wants to avoid a hearing or a lawsuit in this situation. . they need to post notices saying the retailer will not oppose employees talking to union representatives.Wal-mart Is Wrong By Bribing Employees For It Encourages Dishonest Behaviour. it might encourage them not to unionize. Wal-Mart is wrong by bribing employees for it encourages dishonest behaviour. Thus.
Wal-Mart has racked up a striking number of wage and hour violations. .Unfair Treatment of Employees: Wage And Hour Violations : Not only does the company have a history of methodically violating workers‟ right to join a union. the Wal-Mart record on worker rights is a laundry list of abuse. Evidence suggests that Wal-Mart may have even adopted a strategy of eliminating long time workers and discouraging overweight or otherwise unhealthy workers from applying—both as measures to reduce payroll and health care costs. Decreased health care coverage: Wal-Mart has decreased health care coverage to employees while touting its commitment to offering affordable care.
including minors working too late. ignoring seniority. “Wal-Mart is proving to be a nation and future breaker” by violating the child labour laws and spoiling the future of the children to enrich themselves. too many hours a day and during school hours.000 employees in 128 Wal-Mart stores in the USA found 1.371 violations of child labour laws.Violations Of Child Labour Laws One internal audit of 25. .
as other firms slash employee wages and benefits in an attempt to compete with the retail giant .According to Newsweek magazine Denial to pay wages and salaries: The Bentonville-based multinational employs thousands of young people to pack its customers' bags. Wal-Mart‟s model is fast becoming the industry standard. But the 4. Reasoning given by Wal-Mart: So. Wal-Mart succeeds to defend its position as the undisputed leader of the pack when it comes to violating fundamental workers' rights .300 young teenagers don't receive any pay from Wal-Mart.
. According to Hoover’s handbook of American business. 2. The suit was filed because Wal.Mart failed to provide equal employment for women. Gender Discrimination The company faces the largest gender discrimination case in the history of this country.UNETHICAL PRACTICES OF WAL-MART Payment of low wages: Wal-Mart pays low wages and appears to aggressively seeks to keep wages down. Under payment: women are underpaid in relation to men. Discriminatory policies are as follows: 1.000 current and former Wal-Mart workers) against the company . “in June 2001 a group of six current and former female Wal-Mart employees filed a sex discrimination lawsuit (seeking to represent up to 500. Denied Training: Women had been denied training and promotion opportunities that are offered to men.
there are over 70 percent of women working at Wal-Mart.com) ." (www. So.arkansasnews. Less dignity and respect to women: “Wal-Mart is the nation's largest employer of women. but unfortunately they are being treated without dignity and respect. men are holding more management positions than women. but only a small amount of those women are managers.Gender Discrimination Less Managerial positions to women: In fact.
In fact. Wal-Mart recently introduced workplace diversity initiatives. If Wal-Mart wants to avoid lawsuits they need to give more job opportunities to women and they should get paid as much as male employees.Meeting the Challenge of gender discrimination So it seems then that discrimination is a big problem at Wal. they can do better if they put a stop to discrimination for it will save them money on lawsuits. .Mart. intended to prevent further gender bias. Even though Wal-Mart is such a successful company.
“Members can save as much as 50% on services not normally covered by medical insurance. . So. those employees who couldn‟t afford the health plan will probably have to get their health care benefits through their spouses or the state from our tax dollars. Wal-Mart still has a moral responsibility to provide affordable health care to its employees not shift the cost onto the American taxpayers.Expensive Health Insurance Wal-Mart’s health insurance is so expensive that some of the employees can not even afford to pay for it. Wal-Mart responded to this problem by offering discounts on health care coverage.” Discounts are not enough. Wal-Mart can also raise employees’ wages so they can afford to pay for their health plan.
a federal judge ruled that Wal-Mart should pay workers for overtime hours” . So “in February 2004. they are supposed to pay employees for every minute they work. So Wal-Mart‟s managers who required overtime were disciplined and fired. In fact. employees were forced to work unpaid overtime. according to Wal-Mart‟s policy. As a result.No Over Time /Wages not in proportion to Work While wages are low at Wal-Mart.But. But. there will be cases in which managers might do unethical things. they filed a suit against Wal-Mart for not getting paid for overtime. it is Wal-Mart‟s responsibility to make sure that people get paid. For instance. It seems that WalMart needs to periodically examine its pay practices to make sure that all employees are getting paid for all the hours worked. In fact Wal-Mart claimed their policy is against such work. the case is still pending. In fact. They should settle the suit by paying their employees for unpaid overtime. . since Wal-Mart is such a big company. too often employees didn’t get paid at all for overtime.
When national labour or environmental standards create a barrier to cost cutting. Even where wages are rock-bottom. WalMart frequently requires its suppliers to open their books for Wal-Mart inspection and tells them exactly where to cut costs. suppliers are encouraged to relocate to a labour market that will enable them to produce at the low price Wal-Mart requires. To do this lot of unethical activities crop in to come on to the lowest cost .lot of people in the supply chain suffer because of this cost cutting drive . Wal-Mart insists that its suppliers drive prices ever lower.Sufferings below the low Cost Offerings to the public Wal-Mart is leading the race to the bottom by relentlessly squeezing cost efficiencies out of the supply chain.
Immigration experts said the arrests of so many illegal immigrants at Wal-Marts across the country demonstrated that these workers have come to play a significant role in the American economy. In fact. low-paying jobs shunned by not just American workers. Wal-Mart cheated immigrant on account of low wages social security payments. Wal-Mart was accused of breaking immigration laws. Wal-Mart claimed they hired those particular . the company became the target of a class action suit.Use Of Illegal Migrants As Workers Finally. federal payroll taxes. Wal-Mart was under investigation for the use of illegal immigrants as workers.” As a result. They often take the low-end. but also legal immigrants. Contractual employments No security of tenure No payments for over time. “in October 2003 federal agents uncovered 300 illegal immigrants employed by outside contractors cleaning its stores. So. In addition. But.
get things together wall-mart if you would actually pay your workers enough to live maybe you would save money in the 'loss prevention' department because your workers wont have to steal from you to make ends meat!!! Mike Bismarck.HELLO you are WAL-MART a short drop in sales should not lead to me and my family being broke. The final straw that made me quit was the fact that I was a full time department manager.REPORTINGS BY EMPLOYEES I hate wall-mart I worked there 3 years and saw many bad practices.S. Arkansas U. yet only was getting 16-22 hours a week!!! When I asked why my hours where being cut they told me it was due to a lack of busness.A .
Also we have a grievance that WALMART is open ALL DAY thanksgiving.S.A.. employee morale used to be high until management started cycling quickly and for some reason lost MOST of its management team that actually CARED about the store. employee morale is down more than ever. this member of management is bringing down morale and the store manager and other members of management know this and they do not care. management could care less about its workers. manager who is unprofessional. mean spirited. she has been overheard telling associates to stop their meals and do small work errands (which is illegal) and clock back in EARLY to do things for her. New York U. Truth is here The Catskill NY Super Wal-Mart is still just under 2 years old.REPORT BY catskills. doesn't care about the employees they oversee and speaks down to them. this isnt what Sam Walton wanted. Now left with a severe management shortage employees are forced to work with a long time *FRIEND* of the store manager who is an asst. they consistently display unprofessionalism that would not be tolerated by a UNION.. and employees/customers. forcing employees to work long 9 hour shifts. . giving them NO CHANCE to spend quality time with their loved ones on this holiday that is supposed to be about FAMILY. management USED to be grade A quality.
. In a unfortunate incident an employee was hurt and compensation was asked but was completely denied and the small wound was converted into cancer because she was poor and couldn't afford medical treatment. So in wall mart employees are not treated as a part of the family and business and have no values in the eyes of management and board as was reported by the ex-employee.WALMART INJURY DEVELOPED CANCER WAL-MART DOES NOT CARE *Rebuttals *Consumer Suggestion ex-employee .
.Success of Wal-Mart in question The sentiment behind Wal-Mart founder Sam Walton's promise of a "better life for all" belies questionable business practices many that have been challenged by employees. unions. environmentalists. All these challenges should be met and it should learn lessons from their mistakes. recording artists and human rights organizations.
it will attract good employees and people will have no reason to complain about the company. If Wal-Mart wants to survive they will have to try hard to improve their image.Conclusions: The companies that survive are the ones that can spot ethical issues and correct them before they become problems. . In addition Wal-Mart needs to be socially responsible in order to avoid economic harm and in order to maintain the legitimacy granted by society. In this case Wal-Mart failed to acknowledge those potential problems and they are probably going to pay for it. Wal-Mart‟s unethical business practices have hurt its company‟s reputation. That is. As a result. Thus. they need to show that they care about ethics by treating employees fairly.
. it forces the closure of better paying firms. In some cases. two other supermarkets will close.Conclusions: As Wal-Mart is not just a threat to the standard of living of its own employees. Business Week estimates for every WM supercenter that opens. It damages the standard of living of numerous others in the economy.
.as it is giving back to the society.We will hail Wal-Mart if it hails the society at large There should not be any compromise on ethics and socially responsible behaviour. other wise its survival will be in danger.
Say no to unethical practices Wal-Mart's immoral. predatory practices and reprehensible behavior has to be mended which is essential for the survival of Wal-Mart .
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