Walmart has been a very successful and power business for a long time. I have heard lots of stories about pay and incentives but with any organization there is a set percentage pay and incentives for employees at higher and lower levels. At Walmart the incentives pay is much higher than that of the average employees. The incentive pay is a reflection on well the organization is doing because the executives have a stronger influence and say on what goes on in the company than any employee. Managers are paid at a higher rate than the average worker and the higher one goes in the organization their pay and incentives match their position and responsibilities. CEO Mike Duke, is being paid the highest and has high incentives to go with it. There …show more content…
They feel that they are doing the bulk of the job and manager get their compensation, but as a manager or CEO they have to do all the “behind the scene job” and oversee and delegate successful daily operation of the company. CEO’s provide or teach skills and talent that is required to produce the desired product or service and in this case, a strongly performing company. The skills and responsibilities that come with the job of CEO are extreme and the number of people who can fill these roles is limited. That is why the market has determined that people with these skills are worth a lot of money to their companies and is compensated to suit. I see the reasoning for the incentives and pay but when comparing $12.40 an hour which is $25,800 a year compared to Mike Duke’s salary of $1.3 million and total compensation was 18.1 million (Noe, 2013). There is a massive difference and most of the times I don’t think that the workers want same salary and incentives as their CEO’s but they feel they are not paid well enough for the job done. I think they are grumpy if they are over worked, understaff and not paid well enough. However, this will definitely motivate worker to work towards becoming employed higher paid position or at a management or CEO level. Also, the case study said they no longer eligible for profit sharing and this might encourage worker to work towards securing a management position to be eligible for this
In Deenu Parmar's "Labouring the Wal Mart Way," the author discusses the business practices of Wal Mart, their impact on systemic poverty, and on existing work unions. Their business model forces competition to align with them, or close up shop. Wal Mart hires workers that would usually have a difficult time finding employment. That said, they pay them well below a living wage. Staff are also subject to abuses like overtime without pay. Wal Mart is resolute in their feelings towards unions. Their hiring process designed to cut out union sympathizers. This way, they can prevent any retaliation from staff seeking a better work environment. If anti-union efforts are unsuccessful, they close the store. It also forces existing unions to take pay
According to Charity Navigator (Are Nonprofit CEOs Overpaid?), certain industries pay more than others, specifically; an executive can earn more at an Educational charity rather than a Religious one. Geographical location typically reflects the variations in cost of living throughout the country. Naturally, charities with larger budgets can afford to provide higher compensation. The focus of an organization's mission can also have a significant impact on the amount of compensation available. The board of a nonprofit should have a documented policy for determining compensation and raises. While there are not very many charitable organization executives earning over $1 million dollars annually, it should still be of concern because such an amount is quite
The Wal-Mart Corporation is a multi-billion dollar low-cost retail organization, consisting of 6400 stores and 1.8 million sales associates worldwide. Wal-Mart’s influence on the retail world and the enormity of their corporate size is unparalleled. Wal-Mart can easily report sales of $312.4 billion dollars per fiscal quarter and net profits of $3.8 billion dollars. Wal-Mart promises her customers "Always low prices. Always!" and upholds this motto by providing low prices to her customers and high return on investment to her stockholders. One way that Wal-Mart has managed to maintain a competitive edge over other low cost retail giants and provide low prices is by cutting wages and by not offering too many company benefits to their employees. Full-time employee working at Wal-Mart only make $8 an hour, while only 45% of the workers can afford to be covered by health insurance. Wal-Mart also increase part time employees from 20 percent to 40 percent so that they do not have to cover all of their employees for health insurance . Although Wal-Mart may not provide excellent benefits to her employees, it successfully performs as a legitimate business operating in a capitalistic society. Wal-Mart upholds the primary fiduciary duty to satisfy her stockholder and follows free the market libertarianism model, which states that a business should not interfering with the free market. In a free market Wal-Mart has a direct responsibility to her primary stockholders rather than the employees of a company.
Today Wal-mart has a higher GDP than the entire country of Switzerland, but don’t worry they’re pretty neutral about it. But there has also been news about how they treat there employees. In 2004 an article was released entitled Everyday Low Wages: The Hidden Price We All Pay for Wal-Mart, and soon after Washington got involved. The bad publicity took a toll on Wal-mart and in fact is still today, Maryland passed a law in January, 2006, that said larger employers, such as Wal-mart, must spend at least 8% of their payroll on health benefits for their employees, and now many other states have followed suit. The bad publicity also made it so 8% of customers shop elsewhere because of what they’ve heard, this has caused lower expected sales around the holidays during 2004, and 2005. Some things they’ve done is in 2006 they paid employees on average 9.36 dollars, while other major retailers like Target and Sears pay on average 11.08 dollars. While this can be easily denied by Wal-mart, another way they have gained bad publicity is from something called off-the-clock work. If they had not finished their job they had to clock out and then still finish their job, meaning they wouldn’t get paid for
For as long as I can remember, Wal-Mart has always been an extremely powerful business where everyone shops. In fact, at a young age, I got an idea of just how powerful Wal-Mart is when the Wal-Mart my family usually shopped at moved from its location right next door to a Hy-Vee, to completely across town in an effort to steal customers from them. However, one thing that has always been apparent to me is that despite the fact that Wal-Mart is a huge and powerful business, its products are what some consider to be cheap, and working at Wal-Mart is not what most people would consider a great job. This made me question what is truly going on behind the scenes at Wal-Mart. If it is truly that terrible of a place with such terrible things going
Walmart has one of the lowest prices of goods and products in the retail business. Jeffrey Garten a dean at Yale says, “The essence of Wal-Mart is it is propelled by one thing: offering products at the lowest possible price” (24). While having, low prices is good Walmart is taking its toll on their employees. Having such low prices forces Walmart to pay their employees so little. A point made to Garten was “Walmart
Some believe that Walmart does offer attractive pay and benefits to its employees, “Full-time workers receive benefits that include competitive wages, profit sharing, 401(k) plans, paid vacations, life insurance, a discount card, medical coverage, disability insurance, scholarship bonuses and child care discounts” (Hoeing 47). Full time workers seem to receive competitive wages and good benefits. Also Walmart is raising its wages in order to satisfy its workers. “The wage increases and other programs will cost the retailer about $1 billion” (Ziobro and Morath A2). By Walmart increasing its wages to $10, it shows that the company cares about its employees and are willing to take a big financial hit to ensure the satisfaction of its employees. On the other hand, some believe that Walmart wages are not enough to live off of or to support their families. For example, according to a current Walmart associate that is considered “high paid” named Jennifer McLaughlin, “the way they pay you, you cannot make it by yourself without having a second job or someone to help you, unless you’ve been there for 20 years or you’re a manager” (Olsson 607). McLaughlin does not believe that she is able to provide for herself alone with the pay she is receiving from Walmart and she is supposedly considered high paid as well. Walmart has had a history of treating its employees unfairly, for example,
Wal-Mart’s compensation structure consist of three components for their executives’ total direct compensation, or TDC: base salary, annual cash incentive, and long-term equity (consisting of a mix of performance share units and restricted stock/restricted stock units). Wal-Mart’s compensation for their NEO’s breakdown was as follows: 48.5% long-term performance share units, 10.6% base salary, 24.7% annual cash incentive, and 16.2% restricted stock. Target’s compensation structure consist of three components for their executives’ total direct compensation, or TDC: base salary, short-term incentive, and long-term equity (consisting of a mix of performance share unit awards and performance based restricted stock unit awards). Target’s compensation
This paper will discuss the reasons why CEOs are not being overpaid. It will apply the utilitarian ethical principle to many a few aspects to CEO compensation and whether or not it is justifiable for such pay. The paper will look at whether or not their performance is justifiable for the pay because they play such a big role in the livelihood of the company along with the principle agency theory and how it is being addressed for the benefit of the shareholders and others involved with the company, the supply and demand of the CEOs, and the paper will describe the comparison of other professions to help link the idea of CEOs being fairly compensated.
According to Walmart’s website, with their revenue of $485.9 billion, they employ approximately 2.3 million associates worldwide. They clearly are one of the largest private employers. Because of this status, there are many opinions in the news that they can afford to pay their workers more. It has been written that Walmart workers have been protesting for years about the low wages that Walmart pays its employees and that’s why they voluntarily raised the minimum wage. I have mixed views regarding the reasons.
The fact is that Walmart pays its employees a minimum of nine dollars per hour, which is more than the federal minimum wage at seven dollars at seven dollars and twenty-five cents per hour. Additionally, Walmart does provide their employees with basic health benefits. Still, critics demand that Walmart pay their employees more and provide more health benefits, but rising costs would result in higher prices which would result in less purchasing power. That is not good for the economy. What critics fail to comprehend is that a job at Walmart earning minimum wage is not a full-time job but a part-time job, as employees should be going to college or looking for other higher paying jobs. Overall, it’s the same exact situation as the “Mom and Pop” farce and every other complaint, like price discrimination and predatory pricing; Walmart is following a business model that gives consumers the goods and services they crave at affordable prices and a low cost for Walmart. Walmart’s practices are ethical, legal, profitable, and exemplify the principal of the free market system, so any American that claims that Walmart should be targeted for its practices are virtually asking the government to target the foundation of the American economic system. In addition, those same people are asking for
From this, it is clear that not everyone is a fan of the company. But where are this perspective coming from? It is just as likely for them to be from a biased outlet as the information they’re presenting being false. However, these perspectives can be easily counteracted by opposing ideas. One of which being the author stating the so-called “investing over $2.7 billion in wages” plan. Which I can confirm is true. In addition, since this plan was introduced in 2015, it has had a positive impact on the companies sales both in stores and online. The 200 training centers opened in 2015 as mentioned by the author, was a positive implementation in order to increase the minimum hourly rate. Before of which, had been a common complaint and issue associated with the company. Not only this, but there were endless complaints made about the company’s employee treatment, but it seems as though Walmart has acknowledged these complaints and in recent times has taken a step in the right direction. The author had not addressed much factual information regarding its suppliers and rather the “goals”
They only make a little more than average household income. The CEOs, athletes, celebrities that do make millions of dollars are those who worked for it and therefore it is completely justifiable. People need to quit blaming others for their downfall instead of arguing about the pay gap between CEO and workers they should strive to become a CEO. Anything is possible, and everything is reachable with the correct
Executive compensation has been studied for many years. While the average person probably does not think about it on a daily basis, it is necessary to watch trends. Tracking the amount of money they make as well as the bonuses, stock options, and other benefits shows how these executives are making such high rates of pay compared to the ordinary worker. Tracking how much an executive makes began in the 1930’s. Since this time not only has it been tracked but there have been many changes in the type of tracking, the tax laws and what is available as compensation. This paper highlights the changes that have occurred since the early 20th century until today and changes that still need to occur.
...arket, they still attempt to improve their performance in other areas, by contributing to charity and hence improving their local reputation, however they have very low customer and employee satisfaction. These lowered performance indicators stem from low employee motivation. It would be very beneficial for Walmart to increase these performance factors as the small cost of improving employee’s conditions and motivation would be balanced by not having to re-hire 70% of their work force every year.