Wal-Mart’s Unethical Behavior
Wal-Mart’s Unethical Behavior
For the past few decades Wal-Mart has been criticized and accused for being involved with all sorts of unethical behavior. Many various groups of people have come after Wal-Mart protesting against their company’s policies and business practices. Labor, community, environmental, and religious groups are some of the most known types of groups that have tried to personally attack Wal-Mart for their lack of social responsibility. Just some of the many areas that have raised concern by people would be the corporation’s foreign product sourcing, environmental practices, the use of public subsidies, and the treatment of employees and product suppliers. Wal-Mart continues to deny any allegations of wrongdoings and unethical behavior (Fishman).
Many stories have surfaced that would label Wal-Mart as being an unethical company. Some stories are big, some are small, and some are probably completely made up. However, there is a lot of evidence that shows how unethical Wal-Mart has been in many different types of circumstances. Prior to 2007 it was estimated that 87,000 Wal-Mart employees were cheated out of $34 million because the Wal-Mart executives failed to pay workers overtime. Some even admitted that they were trained by their superiors to not pay anyone overtime. This is a very immoral act because the workers are not getting paid what they deserve and this makes it harder for them to pay for their living expenses (Fishman).
Wal-Mart has had over 100 lawsuits concerning wage and hour violations. They have been charged with not giving workers federally mandated breaks and lunches. They have also required workers to take their missed breaks or overtime before the Friday’s end of the pay period, which is an illegal act. Wal-Mart has been accused for not paying full-time benefits for workers who work 40 hours or more per week. In 2005 in the state of California, Wal-Mart was forced to pay $172 million in damages. There has been several cases of where Wal-Mart has had to pay many millions of dollars for employee damages. The ethical issue in this case would be fairness. All employees should be granted what they deserve and what they were promised (Greenhouse).
Wal-Mart does not pay many of their employees enough money to support their family or even have health care. They pay 26-37% less than the national average for the same jobs in the retail industry. Wal-Mart pays poverty level wages and this is very unethical because they make such huge profits that can allow them to pay decent living wages. Wal-Mart profits more by using State Governments to fund health care for its employees which is not fair to their competitors or the society (Olsson).
Wal-Mart has the worst health packages when compared with their competitors. For example they cover only about 50% of their employees while the national average for major retailers is around 64%. Wal-Mart employees have to wait for 6 months to get health insurance compared to the national average of 3 months. They even charge extra for emergency room visits and ambulance usage. Also, employees with pre-existing conditions have to wait at least one year to receive any treatment. Instead of trying to give their employees the bare minimum, Wal-Mart should readjust their prices and salaries so that enough money would go towards things like basic health care (Fishman).
Thorough studies have been done as well as many court cases that prove that Wal-Mart discriminates against women by not paying them as much as their male counterparts. It is also much rarer for women to be promoted to upper management than it is a male. A 2003 study was done that showed that women received 37 cents an hour less than the men that held the same position. Female managers earn about $5,000 less than male managers.
Even though 72% of Wal-Mart’s workforce consists of women they still only make up 33% of all managers. Jon Lehman who is a former Wal-Mart store manager said that most of the superiors believed that women are useless at Wal-Mart. An African American woman asked a superior if she wasn’t promoted to management because she was a woman or because she was black and the superior replied that two out of two isn’t bad. Not only is this against the law, but it is very immoral as well as discriminatory (Norman).
Just one audit of one week’s worth of time clock records at one specific Wal-Mart showed that minors were working too late at night, during school hours, and were working too many hours a day. It also found more than 60,000 cases of minors not taking breaks and even more cases of minors working through meal times. This is unethical because minors should be focusing on school and not working too many hours at Wal-Mart. A Wal-Mart in CT was given huge violations for having minors working with machinery such as paper balers, chainsaws, and forklifts. Children are not at the age of consent to operate such machinery in any fashion. Horrific incidences were discovered in a Wal-Mart factory in Bangladesh where children were routinely beaten, forced to work overtime for little or no pay, and were told to lie about their age (Greenhouse).
In China, workers are treated more like slaves than people. They are treated as tools to get the work done as quickly and cheaply as possible. They are taught to lie to inspectors and auditors about the amount of time they work and the working conditions that they endure (Greenhouse). They were told that if they didn’t lie then they would lose their job. Wal-Mart pays only 18 cents for a product that is made in China that they charge $14.96 for in America.
It was reported that a Wal-Mart supplier factory employed minors as young as 12 working them for excessive overtime hours and for under minimum wage. They were also working with chemicals without any protective gear. All human beings should be treated with a certain level of respect regardless of age or ethnicity. Wal-Mart should improve their working conditions and remedy all situations of unethical behavior especially towards those who are under age and not supposed to be working in the first place (Fishman).
Wal-Mart claims to care about the environment, but they actually harm the environment. They lied about having an environmental person dedicated to these issues and they don’t actually have an environmentally friendly policy in place. Wal-Mart shows to have more of an avoidance towards their harming of the environment. They have been known to put chemicals into the environment that can cause birth defects as well as storing fertilizers in parking lots unprotected. Wal-Mart has seemed to continue to ignore the idea of better storage for certain products and necessary environmental policies. Over a few years span Wal-Mart has had to shell out millions of dollars to pay for Clean Water Act violations (Olsson).
Wal-Mart has received billions of dollars in subsidies to set up shop nationwide as well as some other countries. Wal-Mart is so profitable that it does not need to receive money from anyone. If Wal-Mart was a community conscious organization then they wouldn’t need any money from cities, states, or communities. They often set up their stores on the outskirts of town so they can receive free plumbing, however other companies and citizens have to pay for such utilities themselves when they’re in the same situation (Bianco).
Sam Walton was known for practicing corporate socialism. He sought out free land, long term leases at prices below market, getting workers trained at the government’s expense, and even pocketing sales taxes. He also had a $37 million ramp and roadway constructed for Wal-Mart’s corporate headquarters in Arizona which the State paid for (Fishman).
The government’s money that is going to Wal-Mart could be going towards things such as education and building our youth. They are a very selfish organization that strives to get bigger individually and have complete disregard for everyone else. There was a case in Denver where three schools ended up closing because there was not enough money to keep them open, however around that same time period Wal-Mart received $2 million. It is very unethical and not abiding by free market policies to give such a huge store like Wal-Mart such a competitive advantage when the mom and pop stores continue to go out of business (Bianco).
By being such an unethical company Wal-Mart is putting smaller, trustworthy businesses out of business. Since they pay very low wages and receive money from states and governments, they can charge such a cheap price which in return puts those smaller businesses that have to charge slightly more for the same products out of business. It is just plain wrong how Wal-Mart treats everyone that is involved with their organization and the competitors. They don’t care about the economy or the environment; they only care about how much money they can collect. It is estimated that Wal-Mart’s trade deficit with China eliminated 200,000 U.S. jobs between 2001 and 2006 (Olsson).
If Wal-Mart was its own nation then it would be China’s eighth largest trading partner. Wal-Mart is able to have such cheap goods because the safety standards are lower in China which in return puts the American consumer at risk. This is very unethical because Wal-Mart is risking their consumer’s health by trying to maximize their own profits. By offering such low prices, Wal-Mart is putting other companies out of business that actually sell quality products that are safe to the consumer (Bianco).
Wal-Mart has hundreds of cameras and security guards inside their stores to protect their own merchandise, but it’s a completely different story when it comes to the type of security that is present in the parking lots or outside of the stores. There has been so many shootings, carjackings, and muggings in Wal-Mart parking lots that many local police departments have asked Wal-Mart to hire on site security guards to help protect against such behavior. However, for the most part Wal-Mart has failed to do so. Wal-Mart has known of these types of issues in their parking lots, but have continued to turn their heads in the opposite direction (Norman).
When Wal-Mart plans for new store locations, there are many activists and groups of people that oppose and try to protest the construction of the new store. Wal-Mart tends to ignore issues such as traffic congestion, potential environmental problems, public safety, and bad public relations. In 2004 Wal-Mart opened a store in Mexico just over a mile from the historic Teotihuacan archaeological site and the Pyramid of the moon. This caused a lot of protests with the locals because they thought this was a very disrespectful notion. By building a Wal-Mart in such a symbolic area it was seen by many as placing one of the main culprits of globalization in the heart of ancient Mexico (Fishman).
In 1998 Wal-Mart wanted to open a store in Nashville, Tennessee right on top of Native American burial grounds and where a Civil War battle took place. Protests took place, however Wal-Mart won the battle and ended up moving the graves so they could construct the new store. If this isn’t immoral and disrespectful then I don’t know what is. I would have to think that there would be other locations where they could have opened the store. It almost seems as if Wal-Mart likes to show their power in any way possible (Norman). Wal-Mart cannot justify all the wrong that they have done to many people and communities by simply offering and continuing to express their low prices. Money may make the world go around, but it won’t save the world. People’s actions is what will make this world a better place to live in. Sacrificing the environment and human rights is simply immoral and unethical just so one major monopolistic organization can continue to offer the lowest prices possible.
Wal-Mart needs to be held accountable for all of their actions regardless of the amount of money they produce. It is very difficult to monitor and control such a huge companies actions and to try and stop them from being completely unethical. The outcome of their unethical behavior has been many lawsuits and they just continue to surface. Wal-Mart has such a huge profit that these lawsuits do not stop them from being unethical (Bianco).
Hopefully Wal-Mart’s unethical behavior will eventually catch up with them. Wal-Mart superiors at the corporate level should understand that unethical behavior eventually turns around to bite you but they continue to ignore the issues. It will take many years to completely resolve the type of unethical behavior that is allowed but steps need to be taken to reach that sort of goal. A complete restructuring of the company and those in charge may be necessary to cleanse the unethical behavior. The right people and policies must be in place from top-down to every Wal-Mart store across the entire world. Once they realize all the issues and feel the need to correct them, then they can look forward to the future in a positive and ethical way that will benefit everybody involved.
Bianco, Anthony; Zellner, Wendy. Is Walmart Too Powerful? Business Week. 2003. Fishman, Charles. The Walmart You Don’t Know. Fast Company. 2003. Greenhouse, Steven. In-House Audit Says Walmart Violated Labor Laws. The New York Times. 2004. Norman, Al. The Case Against Wal-Mart. Raphel Marketing. ISBN 0-9711542-3-6. 2004. Olsson, Karen. Up Against Walmart. Mother Jones. 2003
University/College: University of Arkansas System
Type of paper: Thesis/Dissertation Chapter
Date: 17 November 2016
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