Walmart cuts workers’ hours after raising wages, surprise!

Walmart praised for raising their minimum wages

Walmart’s recent minimum wage raise might not be so helpful to employees after all. That’s because the retailer, while paying more, has asked several of its stores to cut employees’ hours.

In April, Walmart raised its minimum wage to nine dollars per hour, spending a total of over $1 billion on the increase. However, at this month’s annual holiday planning meeting, store managers were asked to cut back on hours.

Now, they’re in between a rock and a hard place

The move came after Walmart’s recent earnings report disappointed investors. Walmart is caught between a rock and hard place, trying to spend more on employees to improve customer service, while simultaneously maintaining its famously low prices and high profits.

Despite this paradox, top executives seem committed to maintaining the increased minimum wage. Greg Foran, head of Walmart’s US operations, explains:

“Amid the investment [in increasing wages], we’re focused on growing sales and controlling costs, as you would expect from Wal-Mart. We are staying true to our roots. However, we are committed to improving the customer experience and we will protect the investments necessary to achieve this goal.”

Hours aren’t being cut across the board

According to Kory Lundberg, a spokesman for Walmart, hours are only being cut at locations where managers had already overscheduled the staff beyond the amount of hours that corporate headquarters had allocated.

Unfortunately, this means a big loss in take home pay and a lot upheaval in the schedules of many Wal-Mart employees, who have had their hours reduced and have been asked to end their shifts early and to take longer lunch breaks.

Employees are speaking out

Disgruntled employees have spoken to the media anonymously, for fear of being reprimanded. An employee near Houston, Texas, says her store has cut more than 200 hours per week by asking workers to go home early; she says that, since her coworkers have been sent home, she now operates the bustling back-to-school section all on her own.

Another employee in Fort Worth says that employees who were asked to work overtime earlier in the week to help with extra tasks were asked later in the week to take two hour lunch breaks, all in an effort to cut 1500 hours total.

While the minimum wage increase has certainly benefited new employees, it was not accompanied by a raise for experienced workers who were already earning over nine dollars. Some senior officials feel this is inappropriate because the more experienced staff should be in a higher pay bracket than a new hire.

Will customer service take a hit?

Lundberg assures customers that the recent change won’t affect the quality of the customer service they receive, the cleanliness of the store, or the length of the checkout lines.

However, employees tell a different story, pointing to examples of many customers having to wait for extended periods to check out or to access products that are under lock and key. Business experts predict that customer service will decline if hours are cut, and that Walmart could lose employees to businesses where they can have more stability in their schedules.

It turns out there’s more to a good job than just a decent wage. Raising pay while cutting hours is a paradox that greatly inconveniences employees, and may cause customer service to tank.

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