Finance

Walmart raises hourly wage to $11, expands benefits

Walmart raises hourly wage to $11, expands benefits

Wal-Mart also will pay a one-time cash bonus to eligible employees of as much as $1,000. "It's our people who make the difference and we appreciate how they work hard to make every day easier for busy families".

McMillon said Trump's corporate tax cut "gives us the opportunity to be more competitive globally and to accelerate plans for the U.S".

"Retailers have traditionally paid one of the highest effective corporate tax rates", Sandy Kennedy, the president of the Retail Industry Leaders Association, said last month.

Walmart will also offer other nonpecuniary forms of compensation such as expanding its parental and maternity leave policy. Critics of tax reform have said companies are dishing out bonuses for the sake of good publicity and to curry favor with the White House.

The announcement comes after rival Target raised its hourly starting wage to $11 late a year ago, with plans to increase it to $15 by 2020. The one-time bonus will amount to $400 million in the current fiscal year and the company will take a one-time charge in the fourth-quarter of the current fiscal year to account for the charge.

The retailer said on Thursday changes that to its compensation and benefits policy will impact more than a million hourly workers in the USA, with the wage increase effective next month.

Walmart has invested $2.7 billion in higher wages and training for workers to lower turnover and make the shopping experience more appealing.

Taking effect next month, the wage hike will be about $300 million incremental to what was already included in next fiscal year's plan.

The hike will also increase the average hourly pay at Wal-Mart for full-time employees to $14.50 from a current $13.85. Full-time hourly workers in the United States will get 10 weeks of paid maternity leave and six weeks of paid parental leave. Previously, the company didn't offer any paid leave for them. Job postings at an Amazon warehouse in OH, for example, offer a starting pay of $14.50 an hour. Full-time hourly and salaried associates will also be eligible for adoption benefits of up to $5,000 per child.

Target announced it was raising its minimum wage to $11 last September and pledged to establish a $15 minimum wage by 2020.

With this move, the world's largest private employer has scored big points with Republican politicians, who now have a talking point for the campaign trail, and maybe also from shoppers who see its wage increase as socially responsible. Walmart's online business is surging. While many traditional retailers have been struggling to keep up with online behemoth Amazon, Walmart has fared better.


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