Thaindian News

Dec 9 (THAINDIAN NEWS) Walmart Stores has become the biggest private employer in the United States, and have announced plans to cease paying their employees an extra dollar an hour to work on Sundays, which will put a large dent in the expenses of the Department Store Giant.

The new policy will be put in place next year, and will only apply to those employees who are hired after Jan 1, 2011. Cutting down on the cost growth of the company has been a promise of CEO Mike Duke ever since he tool over almost two years ago. There have been six quarters in a row now that Walmart has experienced sales declines at the stores which have been opened in the United States for at least one year. Partially due to health benefits, the cost of operating Walmart Stores rose to almost eighty billion dollars just in the last year.

Although Craig Rowley, a vice president of a consulting group in Dallas states, “It’s a declining practice. When retailers first started opening their stores on Sundays, it was common to have the premium because they were asking employees to do something they never had to do before. But today, working retail requires that you work weekends — it’s part of the job,” Dorian Warren disagrees.

The assistant professor of international and public affairs at Columbia University who studies labor relations explained, “It amounts to a huge wage cut,” stated Warren. “Wal-Mart has been under-performing financially relative to its competitors and needs to find quick ways to shore up profits.” With the largest cost for Walmart being profits, this is not the only cut which employees have faced, according to Bloomberg.

The announcement came last month that the profit sharing contributions would also end next year, to be replaced with a 401 retirement plans which will bring down the cost of employee benefits.