An investigative report found that while other grocery stores were donating food they didn't sell to local food pantries, Wal-Mart has been throwing their unsold food in the trash. Watch the report here!
Posted by Taylor at 11:30 AM | Comments (15) | Hard to Believe
In a recent Huffington Post article, there is yet another example of how harmfull Wal-Mart's tactics are. While saying they support sustainable logging, Wal-Mart is actually creating a demand for illegal, unsustainable logging by demanding their suppliers sell to them at the absolute cheapest price. Here's an exerpt from the article:
Wal-Mart has pledged to "develop transparency to the wood fiber source," but EIA replies that the retailer has shown a "lack of concern" about the sustainability of its wood sourcing. Illegally harvested wood is cheaper because it bypasses environmental regulations, permits, labor laws, taxes and tariffs. Illegal lumber also has a negative impact on the American economy. In 2004, illegal timber cost American suppliers $460 million in lost exports to foreign markets, and as much as $700 million in depressed U.S. prices.The EIA claims that Wal-Mart's drive to squeeze the lowest price from its suppliers encourages illegal logging. "While the company has laid out strong talking points," EIA notes, "it has thus far avoided taking any firm action to eliminate even illegally logged timber from its supply chain, much less to source from sustainably harvested forests." The group says that without concrete goals and more transparency, all Wal-Mart's rhetoric about 'good wood' "cannot yet be taken seriously." EIA documents several case studies of Wal-Mart's "total inattention to the legality of their raw materials."
The EIA report calls on Wal-Mart "to commit to eliminating illegally sourced wood from its supply chain, and to implement a rigorous purchasing policy for wood products that includes auditing and tracking mechanisms." EIA concludes that "the drive for 'everyday low prices' to the exclusion of other questions has a serious cost....The type of logging pervasive in the Russian Far East damages the environment, robs the government of revenue, and promotes corruption. There is nothing sustainable about this model."
If a tree falls in the forest, will Wal-Mart hear the sound?Apparently not, according to an environmental investigative report released this week on Wal-Mart's unsustainable timber procurement practices. The new study says Wal-Mart's "good wood" procurement policy only looks good on paper.
Last month, Wal-Mart released a 59-page "Sustainability" progress report, in which the company said "we want to provide our customers with the assurance that not only are they getting value and quality, but they are getting a product that was produced in a socially responsible manner." But the retailer's wood procurement policies are basically all bark, and no bite.
Wal-Mart sells wood products ranging from furniture, to picture frames, candle holders, tooth picks and popsicle sticks. The typical Wal-Mart supercenter can carry more than 900 different wood products. Wal-Mart tells the public that "an area of forest the size of a football field is cleared every second. That's 86,400 football fields a day. In tropical forests, it's estimated that 50,000 species become extinct each year because of deforestation." The retailer has a "Forest and Paper Network" that seeks to get its suppliers to convert to certified wood, and to give preference to suppliers who can verify the use of sustainably harvested wood fiber. "When we discover sustainable factory issues, we are committed to seeking alternatives," the company says, "or even removing products from shelves."
Based on this pledge, the Simplicity corporation should expect a call any day now from Wal-Mart, pulling Simplicity's wooden cribs from its shelves. An undercover study released this week by the Environmental Investigation Agency (EIA), a non-profit research agency based in Washington, D.C., says that despite the company's rhetoric about sustainable wood products, "Wal-Mart is turning a blind eye to illegal timber sources in its supply chain which threaten some of the world's last great natural forests."
According to EIA, Wal-Mart does not ask its suppliers where their wood comes from, and the retailer's 'don't ask' policy "is having particularly dangerous consequences for the high conservation value forest of the Russian Far East and the endangered species dependent on them, including the world's largest cat, the Siberian tiger.
Roughly 84 percent of Wal-Mart's wood products, like cribs and toilet seats, are sourced from China, and much of China's lumber is imported from Russia, where as much as 50 percent of the logging is illegal. EIA undercover investigators met with 8 Chinese manufacturers that supply Wal-Mart with wood. EIA asserts that Wal-Mart is focused only on price, and "has not concerned itself with the origin of the timber used for its products." Wal-Mart's supply chain "will contribute to the depletion of Russia's 'protected' forests unless concerted changes are made," the EIA warns.
One supplier EIA examined makes over 200,000 baby cribs for Wal-Mart every year from Russian poplar and birch. EIA employees, posing as wood buyers, learned that Wal-Mart suppliers admitted to paying protection money to the Russian mafia, and to illegal logging. Almost comical is the fact that logs coming into China from Russia have to be offloaded from the railcars, and reloaded onto Chinese railcars, because the Russian train tracks are a different size than the Chinese. When Wal-Mart customers buy these wood products, they are supporting "criminal timber syndicates," the environmental group says.
Wal-Mart has pledged to "develop transparency to the wood fiber source," but EIA replies that the retailer has shown a "lack of concern" about the sustainability of its wood sourcing. Illegally harvested wood is cheaper because it bypasses environmental regulations, permits, labor laws, taxes and tariffs. Illegal lumber also has a negative impact on the American economy. In 2004, illegal timber cost American suppliers $460 million in lost exports to foreign markets, and as much as $700 million in depressed U.S. prices.
The EIA claims that Wal-Mart's drive to squeeze the lowest price from its suppliers encourages illegal logging. "While the company has laid out strong talking points," EIA notes, "it has thus far avoided taking any firm action to eliminate even illegally logged timber from its supply chain, much less to source from sustainably harvested forests." The group says that without concrete goals and more transparency, all Wal-Mart's rhetoric about 'good wood' "cannot yet be taken seriously." EIA documents several case studies of Wal-Mart's "total inattention to the legality of their raw materials."
The EIA report calls on Wal-Mart "to commit to eliminating illegally sourced wood from its supply chain, and to implement a rigorous purchasing policy for wood products that includes auditing and tracking mechanisms." EIA concludes that "the drive for 'everyday low prices' to the exclusion of other questions has a serious cost....The type of logging pervasive in the Russian Far East damages the environment, robs the government of revenue, and promotes corruption. There is nothing sustainable about this model."
Wal-Mart admits "it's difficult to know if the products we source are coming from certified suppliers and are being made using legally sustainable practices." But the EIA says it's not enough for Wal-Mart simply to acknowledge the problem. "It is now time for Wal-Mart to commit to eliminating illegal wood from its shelves, and communicate this policy to its suppliers of furniture, frames, toys, paper and packaging and other wood products," the EIA insists. "Wal-Mart shoppers do not want to be an inadvertent party to forest crimes."
Alexander von Bismarck, the Executive Director of EIA, says, "To have Wal-Mart ignore measures that to the rest of the world seem common sense -- such as asking where your suppliers' wood is from -- has an enormous impact. It undermines the current global efforts to clean up the timber industry. When Wal-Mart fails to implement an entire category of environmental responsibility, it creates demand designed to take advantage of that. This is currently feeding the illegal logging problem." The EIA believes that Wal-Mart has within its power the ability to "limit the destruction of some of our planet's final frontier forests and the wildlife and people who depend upon them."
Today, there are more than 6,800 Wal-Mart stores around the globe (the company recently opened its 3,000th international store), but only 400 remaining Siberian tigers. That's not very sustainable odds.
Posted by Taylor at 04:19 PM | Comments (12) | In The News
I am delighted to serve as a clergy spokesperson for the Wake Up Wal-Mart Christmas media campaign, and honored to be invited. I have long felt that ministers had a moral obligation before God to speak out for issues of justice and fairness for all people. The Wake Up Wal-Mart initiative gives us a good opportunity to hold this corporate monolith accountable to more progressive and equitable policies for its thousands of employees.
Wal-Mart has become an integral part of the American cultural landscape. They have amassed untold wealth in this great nation of ours, and they should do much better in providing not only decent hourly wages, but also affordable health care coverage for their workers. As the Bible says, "To those whom much is given, much is required."
Furthermore, Wal-Mart overwhelmingly utilizes foreign manufacturers, principly in China, who routinely violate principles of basic human rights for its laborers.
It is very much in Wal-Mart's long-term interest to improve the compensation and benefits of its employees. Fairer policies would boost loyalty and morale, and cultivate a workplace environment marked by positive values of commitment and dedication. This would in turn be translated into productivity and profits for the corporation, a win-win solution for everyone.
The Scriptures are clear about God's intention that provision be extended to all of God's children. The very word "economy" comes from a Greek concept meaning "household," the idea that everyone in the household of God be cared for adequately and fairly. God is displeased when wealth and abundance, which always comes from God, is not widely and fairly distributed.
Opportunity for personal advancement and initiative is a basic American principle, and a living wage is essential for this self-determination. Wal-Mart, of all American companies, knows this. Let them act on it.
Posted by Rev. Charles Foster Johnson at 03:08 PM | Comments (32) | Guest Bloggers
Here's a piece about our latest add from The Christian Post:
Pastors Urge Wal-Mart to Repent This ChristmasA national television ad campaign featuring two prominent Baptist ministers who call on Wal-Mart to give the gift of economic justice this Christmas was launched Monday.
"The Bible says, 'To whom much is given, much is required,'" says the Rev. Charles Foster Johnson, interim pastor of Immanuel Baptist Church of Nashville, in the television ad which is being aired in 35 markets across the country.
"Wal-Mart rakes in over $21,000 in profit every single minute. This Christmas, let's make Wal-Mart be a better neighbor to us all."
The ad is part of the third annual "Hope for the Holidays" campaign by WakeUpWalMart.com, which spent over $1.5 million in radio and TV ads to draw attention to the retail giant’s unique responsibility toward the communities it represents.
The Rev. Markel Hutchins, a Baptist minister who heads Markel Hutchins Ministries, also joins Johnson in the ad to call on the multi-billion-dollar corporation to be a better “neighbor” to its communities this Christmas by paying fair wage, providing affordable healthcare, and ensuring the safety of the goods it sells.
“A corporation that big has the moral responsibility to do right by its customers and employees and all humanity,” says Hutchins in the television spot.
Although Wal-Mart is America’s largest private employer, the company pays its employees low wages for long work hours, contends WakeUpWalMart.com, and fails to provide affordable health care to its fleet of part-time workers.
The website also reports that Wal-Mart, which made $12 billion in profits last year, imports most of its merchandise from China, where product quality and work conditions have often been called into question.
“Wal-Mart is not the epitome of all unfairness and injustice in the world but it’s just that they are the biggest,” said Johnson in an interview with The Christian Post. “We want these corporate neighbors to have more equitable policies for their employees.”
The church has the role to be “a voice for fairness and justice in an economic system that is increasingly creating disparities,” said Johnson, a visiting Instructor of Preaching at the McAfee School of Theology at Mercer University in Atlanta.
“Justice is figuring out what belongs to whom and giving it to them,” he added. “A decent wage is what belongs to the people of God who are workers.”
From a short-term perspective, one may think that Wal-Mart can accrue more profits by keeping its current employment policies, said Johnson. But he believes that through reform, the company can reap greater benefits in the long run.
“It’s not rocket science to see that that will cultivate a more dedicated, more loyal partner in your business,” asserted Johnson.
In conjunction with the television ad, community and religious leaders from more than 40 cities and towns began holding candlelight prayer vigils outside Wal-Mart stores on Monday night, offering prayers and handing out "Think before you shop" holiday cards to shoppers.
Johnson urged Americans to voice their protest to Wal-Mart’s policies by taking their business to a competitor, even if it means paying a few cents extra for some products. He also suggests that they write letters to the company’s leadership, the manager, or the editor of a local newspaper.
Meghan Scott, deputy campaign manager for WakeUpWalmart.com, told The Christian Post that she hopes for Wal-Mart to exhibit a positive model for other corporations in America.
“The truth is that if Wal-Mart made some small changes here, then everybody would follow suit,” she said.
The ad was paid for by the United Food and Commercial Workers Union and will air until Thursday in most markets.
Posted by Taylor at 11:36 AM | Comments (10) | In The News
Check out this article from the Arkansas Democrat-Gazette about the latest ruling in the massive law suit against Wal-Mart claiming sexual-bias and gender discrimination:
A federal three-judge panel on Tuesday modified its earlier decision that allowed the largest class-action sex discrimination lawsuit to proceed against Wal-Mart.The main effect of the new order, filed by the 9 th Circuit U. S. Court of Appeals, is to delay Wal-Mart Stores Inc. ’s appeal of the court’s February decision upholding a judge’s class certification, according to lawyers on both sides.
Bentonville-based Wal-Mart, seeking review by a larger panel of 9 th Circuit judges, must now resubmit that request.
The order also helped “clear out the underbrush” by clarifying and, in some instances, modifying the court’s earlier order, said Joseph Sellers, co-lead counsel for the plaintiffs who sued Wal-Mart in 2001.
One portion of the new order, however, could remove 75, 000 to 100, 000 potential plaintiffs from the class, Sellers said. He previously estimated the size of the class at 2 million.
Wal-Mart’s lead lawyer in the case, Theodore J. Boutrous Jr., said he would proceed with efforts to reverse court certification of the class.
“The court’s order makes clear that Wal-Mart can now file a new rehearing petition in light of the new opinion. We intend to do that and believe that our arguments are very strong," Boutrous said in an e-mailed statement.
An analysis of liability in the lawsuit, released earlier this year by The Goldman Sachs Group Inc., estimated potential damages at $ 1. 5 billion to $ 3. 5 billion if Wal-Mart loses. Punitive damages potentially push the figure to a range of $ 13. 5 billion to $ 31. 5 billion, the analysis said.
Goldman Sachs’ estimate was based on a class of 1. 6 million current and former workers.
The lawsuit, known as Dukes v. Wal-Mart, claims the company paid women less than men for the same jobs and did not give women the same promotion opportunities as men.
Brad Seligman, co-lead counsel with Sellers, said Tuesday’s new order, while unexpected, “ continues to uphold the largest class ever certified, and I think it moves the women one day closer to their day in court.” “Overall, I think the opinion leaves us in a very strong position,” he said.
Judge Andrew J. Kleinfeld dissented in the latest ruling, as he had earlier when he contended that certifying the class action deprived Wal-Mart of its right to defend against individual cases alleging discrimination. Female employees who were discriminated against also would be hurt by class action, he wrote earlier, because women “who were fired or not promoted for good reasons” would also share in any award should Wal-Mart lose the case. U. S. District Court Judge Martin Jenkins certified the class in a decision released June 22, 2004. Tuesday’s revised decision by the three-judge panel sent back to Jenkins the issue of whether the class should be narrowed to eliminate female employees who had left Wal-Mart before June 8, 2001, when the lawsuit was filed. Those former employees would not stand to benefit from hiring, promotion or other employment policy changes resulting from the lawsuit, Sellers said. However, he contends the class should include employees who worked for Wal-Mart as far back as December 1998, when a complaint was first filed with the federal Equal Employment Opportunity Commission.
Posted by Taylor at 11:00 AM | Comments (3)
It's not a very Merry Christmas for workers at a factory that makes Christmas ornaments to sell at Wal-Mart. A new report by the National Labor Committee cites pay lower than minimum wage, 7 day work weeks, and 15 hour shifts as just a few of the problems found in the Chinese factory. Read more about the report, and Wal-Mart's response in this New York Times Article:
Wal-Mart Stores said today that it would begin an investigation into labor conditions at a Chinese factory that supplies Wal-Mart with Christmas ornaments, after the National Labor Committee released a report [pdf] asserting that Chinese teenagers at the factory worked for less than the legal minimum wage. The ornaments in question come from the Guangzhou Huangya Gift Company, one of the largest Christmas ornament factories in China, which has 8,000 employees and is a supplier to a number of American and European companies.The National Labor Committee — citing interviews, wage records and cellphone pictures smuggled out by teenage workers — said that the employees were being paid at less than Guangzhou’s legal minimum of 55 cents per hour and are being forced to work excessive amounts of overtime. Workers were paid by a piecemeal basis, according to the committee, with some earning as little as 26 cents per hour. The wage records, which were from a 10-day period from June 21 to 30 of this year, show a median wage of 49 cents per hour. By law, the employees should have been earning a median of 68 cents per hour because of overtime regulations.
Hundreds of junior high and high school students were recruited over the summer to work at the factory, with some employees as young as 12 and 13, according to the report. A number of 16-year-old employees, recruited from the Guangdong Province Maoming Transportation Technical School about 250 miles from the factory, were angry at being forced to work shifts as long as 15 hours at below wages promised to them by their teachers. They went on strike on July 8 and filed a lawsuit against the company; as a result, they received some of their back wages.
The students said they were being forced to work seven days a week, and those who wanted to take Sundays off were sometimes fined two and a half days of wages. In addition, photos show the students working with paint, chemicals and without any protective gear, not even gloves or masks.
Richard J. Coyle, Wal-Mart’s director for international corporate affairs, said in a statement today: As soon as Wal-Mart learned about the Christmas tree ornament report, we contacted the National Labor Committee and they have not returned our call. Now that we have a copy of their report, we have launched an immediate investigation. Through our rigorous Ethical Standards program, Wal-Mart aggressively deals with any allegations of improper conditions at our suppliers’ factories. Wal-Mart maintains a very strict Supplier’s Code of Conduct, and employs over 200 people to monitor our suppliers and their designated factories’ adherence. Our program is the largest of its kind in the world - last year, we conducted more than 16,000 audits at over 8,700 factories. In 2005, the International Labor Rights Fund filed suit in Federal District Court in Los Angeles against Wal-Mart, asserting that workers from Bangladesh, China, Indonesia, Nicaragua and Swaziland were working under conditions that violated the company’s code of conduct. But a federal judge ruled in 2006 that Wal-Mart could not be held liable for the labor practices of its suppliers. While Wal-Mart’s efforts to penetrate the five boroughs of New York City have been thwarted by unions and neighborhood advocates, there are at least 20 stores in the metropolitan region.
Posted by Taylor at 12:46 PM | Comments (14) | In The News
Here is some food for thought from BloggingStocks.com, suggesting that you'll be much safer buying from small toy stores this holiday season:
Why you should buy from small toy shops, not Wal-MartThe Boston Globe reports that shoppers are buying toys for their children at small stores and avoiding Wal-Mart Stores Inc. (NYSE: WMT) whose Chinese toys they fear.
One Cambridge, MA store, Stellabella Toys, has shifted its merchandise suppliers from Chinese to European and U.S. toy makers. Stellabella bought as many LEGO toys (made in Denmark) and Playmobil products (made in Germany) as possible. And it added new lines, including German stacking toys and wooden trains from Maple Landmark Woodcraft of Vermont.
More than 65% of consumers will refuse to buy toys from China this season. This hurts Wal-Mart which offers cheaper prices by importing Chinese merchandise. That's because 80% of all US toys are manufactured in China, where they are cheaper to produce. It is more likely that the Chinese toys will end up in mass merchants like Wal-Mart, which often carry large volumes of toys.
I don't know if Wal-Mart will start buying safe toys -- its purchasing volume could drive down the prices and thus bring back some of those shoppers. But in the meantime, you can check out the toys sold by small stores like Stellabella. At least it's supplying what American shoppers want -- safe toys for their families.
Posted by Taylor at 11:05 AM | Comments (37)
This year, we expect that millions of homes will be lit with Christmas lights, the perennial holiday favorite. Like most Americans, I can't help but to smile when I see families quadrupling their electricity bills just to spread a little bit of holiday cheer.
If your family purchased Christmas lights from Wal-Mart, you're in for even more surprises than the ones wrapped up under the tree. How about the risk of lead poisoning, for starters?
CNN just released an article about high lead content in several brands of Christmas lights. Topping the list of dangerous decorations, and hardly a surprise to us, is Wal-Mart's offering. Here the quote from CNN.com.
Wal-Mart brand lights had the highest levels of surface lead, with levels ranging from 86.6 to 132.7 micrograms. GE lights showed surface lead levels from 68 to 109.1 micrograms. Sylvania had surface lead levels from 59 to 70.3 micrograms. Levels of surface lead in the lights made by Philips ranged from a low of 3.2 -- well under the 15 microgram limit -- to 107.2 in another sample.
According to CNN, Wal-Mart's product contains about 9 times the 15 microgram limit for lead content. These Christmas lights are so dangerous, CNN reports, that gloves are required while handling them. Additionally, the lights should be kept out of the reach of children.
If you think something is wrong here, you're not alone. We have spent this holiday season campaigning for Wal-Mart to take responsibility for their their part in America's product safety crisis. Already, our supporters are well on their way toward 10,000 letters to the US Senate, all calling for hearings on Wal-Mart's negative effect on product safety in America.
Let's make stories like this one history. Hold Wal-Mart responsible for the unsafe products they sell by signing our letter to the US Senate.
Posted by Matthew at 03:45 PM | Comments (13) | Hard to Believe
Check out this story from the Arizona Republic about a Wal-Mart law suit that has gone all the way up to the Supreme Court:
Ark. Wal-Mart disability case wins appeal Supreme Court will rule on Wal-Mart discrimination suitWASHINGTON - An Arkansas woman who claims Wal-Mart Stores Inc. discriminated against her after she became disabled has successfully appealed her case to the Supreme Court.
The justices said Friday they would rule on a lawsuit by Pam Huber, who remains a Wal-Mart employee. The case centers on how far employers must go under the Americans with Disabilities Act to accommodate disabled employees.
Specifically, the dispute is over whether Wal-Mart was required to provide Huber with an equivalent position after she could no longer perform her job due to disability, or whether the company simply had to allow her to compete for an equivalent job.
Huber's lawyers argued in court filings that the federal appeals courts have split on the issue and asked the justices to resolve the split.
Huber was an order filler in a Wal-Mart distribution center in Clarksville, Ark., earning $13 per hour, when she was hurt in April 2001 in an on-the-job accident. The company agreed she was disabled and no longer able to perform her current job.
Huber applied for a new job as a router, which paid $12.50, but the position was given to another employee Wal-Mart considered more qualified. Huber was offered a janitorial position that paid $6.20 an hour, her lawyers said in court papers.
Huber sued in June 2004, arguing that under ADA rules, she only had to be qualified for the equivalent position, not the most qualified, and should have been reassigned to the router job. Wal-Mart said in court papers that the job went to the most-qualified candidate under a "standardized, legitimate, and non-discriminatory" process that is allowed under ADA rules.
A federal court in Arkansas sided with Huber, but the 8th U.S. Circuit Court of Appeals, based in St. Louis, Mo., reversed and ruled in favor of Wal-Mart. The ADA "only requires Wal-Mart to allow Huber to compete for the job, but the statute does not require Wal-Mart to turn away a superior applicant," the appeals court said.
"We're confident that the 8th Circuit's decision represents the correct interpretation of the law and that the Supreme Court will affirm the ruling," Sharon Weber, a Wal-Mart spokeswoman, said.
Posted by Taylor at 11:19 AM | Comments (2) | In The News
The British Office of Fair Trading recently found that Wal-Mart, along with several dairy conglomerates and other supermarkets, has been fixing dairy prices in Britain. Wal-Mart now has to pay over $100 million in fines. For more, check out this article:
U.K. supermarket giants J Sainsbury PLC (SBRY.LN) and Asda, a subsidiary of Wal-Mart Inc. (WMT), Friday admitted fixing milk and cheese prices and have agreed, along with a number of dairy firms, to pay fines totaling more than GBP 116? million.Safeway, which is now owned by WM Morrison Supermarket PLC (MRW.LN), following a near-GBP 3? billion acquisition in 2003, also admitted its involvement.
U.K. watchdog the Office of Fair Trading Friday said that the three supermarkets, as well as a number of dairy firms - including Dairy Crest Group PLC (DCG.LN), The Cheese Co. and Robert Wiseman Dairies PLC (RWD.LN) - admitted engaging in anticompetitive practices and agreed to pay individual penalties.
On Sept. 20, the OFT said it had provisionally found evidence that 10 companies, including supermarket chains Asda, Safeway, Morrisons, Sainsbury's and Tesco Group PLC (TSCO.LN) and a number of dairy firms had colluded to increase the retail prices of milk, butter and cheese products in 2002 and 2003.No agreement has been reached in other cases involving allegations against Tesco, Morrisons and dairy firm Lactalis McLelland. Investigations continue.
The OFT said companies that accepted liability and agree to fully cooperate in the investigation will receive a "significant reduction" in the financial penalty they would have had imposed on them.
"The OFT is very pleased that the early and constructive cooperation of Asda, Dairy Crest, Safeway, Sainsbury's, The Cheese Co. and Wiseman, has enabled some of this case to be resolved effectively and swiftly, which will significantly reduce the costs of pursuing the investigation to the OFT and to the businesses concerned," the watchdog said.
Another dairy company, Arla, has been given complete immunity from punishment after agreeing to fully cooperate in the probe. Arla is alleged to have facilitated the exchange of commercially sensitive information on liquid milk products between certain retailers.
J Sainsbury Friday said that it agreed to a settlement of GBP26 million with the OFT and would cooperate fully with the investigation.
"We are disappointed that we have been penalized for actions that were intended to help British farmers, but recognize the benefit of a speedy settlement with the OFT," Sainsbury Chief Executive Justin King said in a statement.
King added that the "price initiatives" were widely and publicly reported at the time and were designed to help the British dairy farmers during a time of "considerable economic pressure and public debate about whether farmers were getting a fair price for their products."
Greg Lawless, a retail analyst at Blue Oar Securities, said that the fines dished out to retailers and dairy companies were unfair, given that the price rises were passed on to the farming community, which was facing tough times during the early part of the decade. There was a political will for this to happen at the time, he said.
"The fines could have been far greater," he said.
Sainsbury's GBP26 million fine represents around 5% of the supermarket's pretax profit for the year, going on Blue Oar's forecasts of GBP500 million.
Asda said in a statement that it regretted what had happened and that it would fully cooperate with the OFT.
"Our intention was to provide more money for dairy farmers, who were under severe financial pressure at the time. These issues concern all the major supermarkets, but we've chosen to settle this matter quickly because we believe it's the right thing to do for our customers," Asda said in a statement.
Tesco Executive Director Lucy Neville-Rolfe said that Tesco had acted independently at the time and had not colluded with others.
"Our position is different from that of our competitors and we are defending our own case vigorously," she said.
At 1410 GMT, shares in Tesco, Sainsburys and Morrison remained relatively flat, while dairy companies Robert Wiseman saw shares up 2.8%, with Dairy Crest up 6.5%.
Dresdner Kleinwort analyst Victoria Watson said that a swift resolution by the OFT is positive for Dairy Crest, as it had been an overhang on its shares.
Dairy Crest's GBP9.4 million fine was relatively small given its fiscal 2008 revenue estimates of GBP1.5 billion.
Company Web site: http://www.oft.gov.uk
-By Daniel Thomas, Dow Jones Newswires; 44-20-7842-9264; dan.thomas@dowjones.com
Posted by James at 12:23 PM | Comments (3)
A new report from UC Berkeley shows that Wal-Mart could raise its minimum wage significantly (to $10 an hour) without much trouble. The company could easily absorb the cost, say by cutting CEO Lee Scott's $22 million salary, or reducing any number of other huge budget items. But even if they are unwilling to absorb the cost themselves and pass it on to the consumer, it would likly cost just .09 percent more per shop. Not a huge cost for consumers, but a huge help to poor families trying to survive on a Wal-Mart salary. Here's what UC Berkeley News has to say about the report:
"Big Box Living Wage Ordinance" would benefit low-wage Wal-Mart workers, minimally impact shoppers, says new studyWal-Mart could increase its minimum wage to $10 per hour and greatly boost the well-being of its low-income workers with little financial impact on most shoppers, says a study released today by the University of California at Berkeley's Center for Labor Research and Education.
Campus labor center researchers report that a "big box living wage" ordinance for large retailers would provide significant and concentrated benefits to workers, mostly members of low-income families, while consumers across the income spectrum would share the costs in small increments.
In 2006, the Chicago City Council passed an ordinance that would have required retailers such as Wal-Mart to pay a $10 per hour minimum wage, but the ordinance was vetoed. Researchers estimate that starting wages for most Wal-Mart positions range from $7 to $8 an hour.
The labor center study, "Living Wage Policies and Wal-Mart: How a Higher Wage Standard Would Impact Wal-Mart Workers and Shoppers," concludes that if Wal-Mart hiked its minimum wage to $10 per hour and in the extreme case, passed on costs fully to consumers, the average impact on a Wal-Mart shopper would be higher product prices of 0.9 percent.
The study finds that close to half of the wage income gain, some 46.3 percent, would accrue for workers living below 200 percent of the federal poverty level. Less than one-third, or 29.3 percent, of the impact of the price increase would be borne by shoppers with incomes below 200 percent of the federal poverty level.
"Big box living wage laws can serve to mitigate the negative impacts on workers of the Wal-Mart model, at only a small cost to consumers," said Ken Jacobs, chair of the labor center.
Other key findings include:
Increasing Wal-Mart's minimum wage wages to $10 per hour would contribute to a payroll of $2.38 billion a year, a 9.3 percent increase over the retailers' current payroll.Poor and low-income Wal-Mart workers could expect to earn an additional $1,020 to $4,640 a year in pre-tax income, depending on what they earn now and whether they work part-time or full-time.
If Wal-Mart shoppers were asked to absorb all of the wage increase, the average impact would be a price increase equivalent to 36 cents per shopping trip or $9.70 per year, for the store's average consumer, who spends $1,088 per year at Wal-Mart.
High-spending Wal-Mart shoppers, (the 12.5 percent of store customers who account for 54 percent of all Wal-Mart sales and average expenditures of $9,775 per year) would see an additional cost of $1.47 per shopping trip, or up to $87.98 a year. The study estimates that 3.4 percent of Wal-Mart shoppers are both high-spending and low-income.
The study uses data from statistician Richard Drogin's analysis of Wal-Mart payroll data, the March 2005 U.S. Current Population Survey, ACNielsen's U.S. Homescan Consumer Panel data about consumer attitudes and loyalty, and Wal-Mart's own data on U.S. sales and customers.The report's authors include Jacobs, researchers Arindrajit Dube and Dave Graham-Squire of the UC Berkeley Labor Center, and Stephanie Luce, an associate professor and research director at the University of Massachusetts, Amherst Labor Center.
The UC Berkeley Labor Center today (Wednesday, Dec. 5) also released a second study, in which researchers Dube and Bill Lester found that Wal-Mart store openings lead to the replacement of better paying jobs with jobs that pay less and are less likely to provide health benefits. Wal-Mart's entry also drives wages and benefits down for workers in competing industry segments, such as grocery stores, their report says.
To download the reports, go to: http://laborcenter.berkeley.edu.
Posted by Taylor at 12:16 PM | Comments (8) | In The News
The Huffington Post recently ran this incredibly inspiring story about a man who took a stand in the name of safety, and against Wal-Mart. Ignoring him when he told them about the dangerous toys on their shelves, Buddy Childress got himself arrested to bring attention to the product.
A Wal-Mart Christmas Toy Story: Shopper Jailed For Removing Dangerous Baby ToyEvery year a Massachusetts-based non-profit corporation called W.A.T.C.H. (World Against toys Causing Harm) publishes during the Christmas shopping season, its annual "10 Worst Toys" list. On the 2007 "10 Worst Toys" List is a product called "The Dora Explorer Lamp," made in China. It looks more like a plastic cartoon character than a lamp. It retails for just under $13 in the baby department at Wal-Mart, and comes with the following manufacturer's warning in small print: "This is an electric lamp, not a toy! To avoid risk of fire, burns, personal injury and electric shock, it should not be played with or placed where small children can reach it. HAZARD: Potential for Electric Shock and Burn Injuries!"
According to W.A.T.C.H., "This colorful lamp, based upon the popular Nickelodeon 'Nick Jr.' character, is in the form of a smiling plastic figurine. The packaging encourages children to 'light-up your room with Dora!' Incredibly, children are further instructed to 'unplug the product when leaving the house, when retiring for the night, or if left unattended.' The manufacturer's proclamation that the Dora cartoon character is not a toy has little meaning to small children, who may be attracted to the figurine and thus be exposed to the potential electric hazard."
The consumer group says it lists toys "with the potential to cause childhood injuries, or even death." According to W.A.T.C.H., their efforts "have fearlessly exposed potentially dangerous toys to the general public. As a result, children's lives have been saved."
Buddy Childress, a 72-year old termite control contractor, did not enter the Wal-Mart Supercenter in Searcy, Arkansas thinking about saving a child's life. Childress lives in the small community of Des Arc, Arkansas, with his wife, Ann. He has owned his small business there for more than four decades. On Thursday, November 30, Childress drove to Searcy, Arkansas to do some shopping at Wal-Mart. When he went into the store, he says he noticed the toy section and decided to have a look at it, "thinking I might see some things our young grandchildren would like. Our three-year-old granddaughter loves Dora the Explorer, a little Nickelodeon cartoon character, so I looked over a shelf full of Dora items."
Childress' visit to the Wal-Mart toy section went south from there. He narrates what happened next: "When I saw a little lamp made in the form of a seated figure of Dora, I remembered that about a week earlier, my wife and I had seen this item mentioned on CNN as being on the 10 Most Hazardous Toys for 2007 list, issued by the organization, W.A.T.C.H. I picked up the box and looked the lamp over. In very small print on the bottom of the packaging was a warning: 'This is an electric lamp, not a toy. To avoid risk of fires, burns, personal injury or electric shock, it should not be played with or placed where small children can reach it.' But it looked like a toy, and it was for sale in the toy department."
Childress called his wife and asked her to get on the internet to make sure that the item he was looking at was identical to the one he has seen listed on CNN. "Ann called me back in a few minutes," Childress recalls, "and told me that she had read several articles, some including photos of the lamp. She told me she'd learned that inside the packaging were instructions to 'unplug the product when leaving the house, when retiring for the night, or if left unattended.' There was no doubt that the item on the Most Dangerous Toys list was the same one for sale at Wal-Mart."
Childress watched as a woman with two small children picked up the lamp and started to put it in her shopping cart. "When I told her what I'd just learned she thanked me and put the item back on the shelf," Childress explains. "I then picked it up and went to show it to the store manager, thinking he would be glad to learn how dangerous it was and would remove it from the toy shelves." Instead, the manager told Childress, "Well, you can hear anything on CNN, and just because something's on the internet doesn't mean it's true." Childress asked the manager to check out the internet information for himself, but he refused. The manager said that it wouldn't make any difference -- he could only pull items off the shelves if they were on a list issued by Wal-Mart's corporate headquarters.
Childress then purchased one of the two Dora lamps on the toy shelf, left the store, and started home. "I thought maybe I could show it to some newspaper editors in nearby towns," Childress reasoned, "hoping they might write something to warn people away from buying it." But as he drove home, Childress kept thinking about the dangerous lamp that was still sitting on that Wal-Mart shelf in Searcy. "I was picturing the family who'd almost bought one when I was there," he confesses. "I also decided I should tell the manager that if Wal-Mart was going to keep selling this obviously hazardous toy -- which wasn't a toy, but was for sale in the toy department -- I felt I'd have to pursue other means of getting the word out about it. Maybe then he would do something."Childress turned his car around, drove back to Wal-Mart, and approached the manager again. "He said he'd called Wal-Mart's headquarters after I'd left, and they'd told him there was nothing they would do. Then I told him I felt this was willful child endangerment, and I'd have to go to -- and write to -- area newspapers. He said, "Well, if you do that, you'd better be sure all your T's are crossed and your I's are dotted, because you will be facing legal action."
Buddy Childress then circled back to the toy department to see if the Dora Lamp had been sold. It had not. "But a little girl was reaching for it," Childress recalls, "and telling her mother she wanted it. I warned them also -- and they didn't buy the lamp." Having thwarted two sales, Childress considered buying the second lamp himself -- but he knew Wal-Mart would just bring out more from their stockroom. "I couldn't keep people from buying the lamp from the Searcy Wal-Mart -- let alone from all the other Wal-Marts in Arkansas and all across the country," Childress figured. "I felt I had to do something that would make a statement and focus attention on this extremely dangerous toy."
Childress dialed 911 on his cell phone, and was connected with the Searcy Police Department. He told the officer who answered the phone where he was, what had happened in the toy department, and that he intended to take the lamp outside the store and destroy it. "He tried to get me not to do it," Childress admits, "but I told him I was going to, and that I'd be waiting outside the store for the police to arrive. I expected to be arrested there, and taken to the police station."
Childress says he took The Dora Explorer Lamp outside the store to the sidewalk. "I destroyed it," he says, "I stomped on it, and then waited for the police to arrive." Before the cops arrived, five or six Wal-Mart employees came out of the store and surrounded Childress. They ordered him to accompany them back inside the store to an office in the back. "I told them I would go, but I would rather wait until the police got there. Their reply was, "You're coming with us now."
Back inside Wal-Mart, employees took Childress' cell phone away from him, and refused to let him make any calls. "They put some papers in front of me and instructed me to sign them," Childress says, "but I refused." A Searcy policeman came in, and the Wal-Mart people said they were charging Childress with shoplifting. "The officer was very courteous and professional, and told me procedure required him to put me in handcuffs." Childress says he then had to take one of the most humiliating walks of his life from the back of the store, out through the front door, handcuffed and escorted by the police. In retelling the moments of his arrest, Childress' voice is unsteady, and choked with emotion.
At the White County Detention Center, Childress was fingerprinted, and a 'mug shot' was taken ("A very unattractive one, but maybe that was unavoidable"). He was searched and questioned, and given a ticket with SHOPLIFTING written in large print. The policeman who had arrested him offered to take Childress back to his car, which was still parked at Wal-Mart, but by the time he was free to go, the cop had to leave.
"By the time I got home," Childress sighs, "I had begun to realize the possible repercussions of people who knew me reading in the newspaper that I'd been arrested for shoplifting. They wouldn't have any way of knowing that my motive in taking something out of the store had been to alert parents about a toy which could hurt their children or cause a house fire. Without an explanation, it would sound like I was stealing."
"I have lived in Des Arc most of my life," Childress explains, "as has my family for many generations. My children and grandchildren live nearby. I have friends and customers all over the state. I went to college in Searcy, and many of my old friends and former classmates live there. My wife and my sons understand what happened and have been totally supportive. So far, I haven't told anyone else. But I know that the story of my arrest for shoplifting from Wal-Mart will be in the Searcy, Des Arc, and other area newspapers within the next few days."
Childress says he took Dora Explorer out of Wal-Mart for two simple reasons: "First, and most importantly, I hope it will act as a deterrent to shoppers everywhere this story appears, to not buy this item from Wal-Mart, or any other retailer. Wal-Mart is continuing to sell this item despite the many warnings about it. You have to wonder how many other items on store shelves fall into this category? Secondly, I want to tell people who know me exactly what I did and why I did it. I hope I can do some damage-control regarding my business and my reputation. It isn't my nature to be a 'protestor.'"
The case of Wal-Mart Stores v Buddy Childress will be heard in an Arkansas court on December 13th. It is a special Wal-Mart Christmas "Toy Story" from the retailer's home state that you won't see on any of their holiday ads. "I have never before committed an act of civil disobedience," Buddy the Toy-Destroyer says. "But I have thought a lot about all this, and regardless of the consequences -- if I had it to do over -- I would still do what I did."
Posted by Taylor at 12:28 PM | Comments (10)
Check out this article from Blogginstocks.com about how a friendlier, less greedy corporate culture seems to be working well for Costco. In fact it seems to be working better than Wal-Mart's hyper-greedy style:
Costco does well by doing good -- pay attention Wal-Mart!It was hard to argue with Wal-Mart (NYSE: WMT)'s ruthless efficiency and emphasis on cost-cutting at all costs when it was producing results.
But as the five-year chart below shows, Wal-Mart's stock has been a serious laggard of late. Meanwhile, its more socially conscious discounting cousin, Costco (NYSE: COST) has been on a tear.
Costco vs. Wal-Mart, trailing five years
Over the past five years, shares of Wal-Mart have lost more than 10% of their value. Costco is up better than 100% over the same period.
A piece in the Seattle Post-Intelligencer sheds some light on the kinder, gentler corporate culture that is producing results for Costco. The article is excellent and worth reading, but this one part of one sentence probably sums up the major difference between the two companies better than anything else: Chief Executive Jim Sinegal, the penny-pinching, self-effacing multimillionaire who is beset by handshakes, hugs and even kisses from employees.It's hard to imagine anyone hugging Wal-Mart CEO Lee Scott. Kicking him in the crotch? Perhaps. But certainly not hugs. And Sinegal even, gasp, donates large amounts of money to Democrats. He tries to visit each Costco location at least once per year.
Furthermore, "He has kept his salary at $350,000 for the past six years, a fraction of what most other Fortune 500 chief executives earn. He also turned down a $200,000 bonus last year because of disclosures of sloppy bookkeeping regarding company stock option practices, and he reimbursed the company $62,463 for using the company's aircraft for personal use."
Is it just me, or is hard to imagine Lee Scott doing any of these things? If the stock's pitiful performance since he became CEO isn't a good enough reason for the company's board to consider urging him to retire to spend more time with his family, perhaps the arrogant corporate culture and terrible reputation that he has helped to craft should be.
Posted by Taylor at 11:19 AM | Comments (8) | In The News
What would you do if you were forced to work extra hours for no pay at your job? What if you didn't get any breaks for lunch or using the rest room? What if you were told you'd be fired if you didn't work off the clock? Wal-Mart has been using this strategy to reduce its costs for years, and now 75,000 workers in Washington are suing the company demanding pay for the extra hours they worked without compensation. This is just one suit among many about Wal-Marts poor treatment of their workers that stretches over 35 states! Here's the article about the suit from the Seattle Post Intelligencer:
Letters were set be mailed Friday telling 75,000 current or former Wal-Mart workers in Washington that they are plaintiffs in a statewide class action against the retail giant.The mailing is the latest development in the suit, which was filed nearly six years ago in King County Superior Court.
Set for trial in the spring of 2009, the suit is "the largest wage-and-hour class action ever certified in Washington state," class counsel Beth Terrell of Tousley Brain Stephens PLLC in Seattle said Friday at a news conference.
"The workers will prove that Wal-Mart failed to pay workers for some of the time they worked and deprived them of legally required meal and rest breaks," Terrell said. "Wal-Mart's drive for profits has come at the expense of its low-wage employees."
She estimated that damages against Bentonville, Ark.-based Wal-Mart Stores Inc. will total tens of millions of dollars in wages wrongly withheld from workers.
In Washington, the company operates 46 Wal-Mart stores and three Sam's Club stores, employing 12,000 to 15,000 workers, Terrell said. Any worker employed at a Wal-Mart or a Sam's Club between Sept. 10, 1997, and the present is automatically a member of the class, sharing in any benefits resulting from a verdict or settlement.
Workers may opt out of the suit if they choose, and Terrell said she expects many current employees to do so, fearing retaliation.
Lead plaintiff Georgie Hartwig Knoles said she worked for more than seven years at the Wal-Mart in Colville, where the store is the Eastern Washington city's largest employer.
"I put in two to five hours a week every week without getting paid, just to get my job done," Knoles said Friday.
"Once I clocked a few minutes over 40 hours per week. I got called into the store manager's office, him and an assistant manager. They flat-out told me, 'If it happens again, you'll be terminated.' "
She said she'd like to be compensated for the hours she worked."I'd also like to see Wal-Mart go back to treating the little people who are doing the work the way (founder) Sam Walton wanted them treated -- like they were human beings," she said.
Terrell said nothing has changed since Knoles was laid off from Wal-Mart in October 2001.
"We continue to hear the pressure is the same on the employees to get their work done, and every year, the store manager is expected to reduce their payroll by 0.2 percent while sales go up," she said. "We think the amount of off-the-clock working has gone up."
Wal-Mart has acknowledged in some cases giving one minute of compensation for an entire day's work and otherwise manipulating workers' time records, Terrell said.
"What's unique is the shamelessness," Terrell said. "The documents we've seen are stunning."
Similar class actions against Wal-Mart have been filed in more than 35 other states. Four have gone to trial and been resolved, all in favor of the plaintiffs, Terrell said.
In California, plaintiffs won a judgment of about $167 million. A Pennsylvania suit delivered a judgment of $151 million, and a suit is currently being tried in Minnesota.
"We're hoping that with five or six more (judgments) against them, even Wal-Mart can't afford this cost of doing business," Terrell said.
Wal-Mart spokesman John Simley on Friday called the adverse decisions "deeply flawed" and said the company "obviously" intends to appeal them. He said courts in 18 states have refused to certify the class in these suits.
"Wal-Mart is committed to treating its associates fairly and in accordance with the law," he said. "The company has very clear policies on meal and rest breaks, and in most cases, those policies do more than is required by the law."
The Washington suit was filed in 2001, but an unappealable ruling certifying the class was just won in May.
Posted by Taylor at 10:29 AM | Comments (10) | In The News
