On the same day the company announced that it was boosting its starting salary for U.S. workers and handing out bonuses, Walmart confirmed Thursday that it is closing 63 of its 660 Sam’s Club warehouse stores. Earlier in the day, Walmart had cited the sweeping Republican tax overhaul that will save it money in announcing the higher hourly wages, one-time bonuses and expanded parental benefits that will affect more than a million hourly workers in the U.S.
A campaign backed by the United Food and Commercial Workers International Union, estimates that 150 to 160 people work at each Sam’s Club store, meaning the closures could affect about 10,000 people.
“This is nothing but another public relations stunt from Walmart to distract from the reality that they are laying off thousands of workers,” said Randy Parraz, a director of Making Change at Walmart.
“I thought, ‘This is really cool.’ And then to find out that my store is closing,” said Laura Fitz, 22, who said she had worked as a sales associate in the jewelry department for two months. At home, she got a call from her manager and had a letter in the mail saying the store had closed and she could seek employment at another Sam’s Club or Walmart store. “It was very sudden and very shocking,” Fitz said. “I don’t think our managers had any inkling yesterday. It was a normal shift.”
Walmart president and CEO Doug McMillon credited the recently passed corporate tax cuts for the salary hikes, saying, “Tax reform gives us the opportunity to be more competitive globally and to accelerate plans for the U.S.”
Online retailers typically pay warehouse employees who pack and ship orders more than store jobs pay. Job postings at an Amazon warehouse in Ohio, for example, offer a starting pay of $14.50 an hour.
Many customers and workers took to social media to complain about how the company handled the situation with many of them saying they weren’t given any notice of the shutdown and many stores were abruptly closed on Thursday morning.
Ken Perkins, founder of research firm Retail Metrics, suggested that the Sam’s Club closings were a misstep, saying, “The store closures with no notice is a bit out of character for Walmart and not the best way to treat your employees.”
About 10 of those closing Sam’s Club stores will be re-purposed into e-commerce distribution sites.
Perkins estimated that Walmart could save as much as $2 billion in taxes this year under the new plan.
Several local media outlets in Texas, New York, Virginia and Arizona confirmed that stores closed on Thursday. For a complete list, click here. “The Barceloneta, Puerto Rico, store closed without notice — over 950 people without jobs,” Eliezer Cabrera, a Sam’s Club shopper, told Business Insider. “This is the last thing Puerto Rico needed after Hurricane Maria devastated the island.”
3 of the stores closing are on the hurricane-ravaged island.
Ref: Business insider, NBC news.
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