Hits Critics In Media Blitz
January 14, 2005
By CHUCK BARTELS, Associated Press
LITTLE ROCK, Ark. -- Wal-Mart Stores Inc. chief executive Lee Scott led a media charge Thursday
to counter criticism that the world's largest retailer is a behemoth that takes
advantage of its workers and stifles competition.
Scott said he wants Wal-Mart workers to know the company was speaking up for
them and he wants Wal-Mart to have a better handle on how it is perceived by
The company bought full-page ads in more than 100 newspapers around the nation
to highlight its message that it provides opportunity for advancement and that
its stores provide mainly full-time jobs that come with a broad benefits package.
"We want to get those myths off the table, set the record straight," Scott said
in a phone interview. He was in New York City for a round of media interviews.
But a union critic of the discount chain said Thursday the company was ignoring
social costs created by its megastores. The United Food and Commercial Workers
Union said Wal-Mart was bending the truth.
Union spokesman Greg Denier said Wal-Mart may count three-fourths of its workers
as full time, but said those employees don't get full 40-hour weeks. He said
the health insurance Wal-Mart touts is too expensive and does not provide enough
coverage for illnesses that are short of catastrophic.
Hartford has become a hub of attention for the chain's labor relations. A new
city ordinance gives union organizers the right to congregate on the property
of a new, 155,000-square-foot store scheduled to open later this month on the
site of the former Charter Oak housing project.
Wal-Mart has 1.2 million employees in the United States, making it the nation's
largest private employer. Scott said Wal-Mart gives communities stable jobs,
and workers have advancement opportunities and benefits that include stock purchase,
and a 401(k) retirement plan.
Scott said the company wants to take its message directly to its customers and
their communities. "Customers trust us, and they want to know their trust is
well placed," Scott said.
That's true of some Wal-Mart shoppers but not most, said Jim Rice, chief credit
officer at Bernard Sands Retail Performance Monitor in New York.
"I don't think a majority of shoppers pay attention to either the charges or
to Wal-Mart's defense," Rice said. "If Wal-Mart has good selection and good prices,
they'll keep shopping."
Rice said Wal-Mart was right to respond to its detractors.
"Any time you don't answer [criticism], you're going to suffer damage," Rice
said, noting Wal-Mart often has let its critics speak and not mounted a defense. "This
will have a positive effect."
Rice said the message from Wal-Mart would help rally employees, and could resonate
in communities where Wal-Mart wants to expand.
"I don't think it will have a huge effect on [Wall] Street," he said.
Wal-Mart Stores Inc. fell 44 cents, to close at $53.64 on the New York Stock
Exchange Thursday, when most stocks were pressured by higher oil prices and concerns
over the economy.
Rice also said the assertions by Wal-Mart could generate a backlash among the
company's opponents. The UFCW has been striving for years to organize Wal-Mart
Wal-Mart allows a worker to qualify for full-time benefits for working 34 hours
a week. But Denier said people who hear that Wal-Mart has 74 percent full-time
workers expect those employees to be putting in a regular 40 hours.
Reprinted with permission of the Hartford Courant.
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