BENTONVILLE, Ark., Jan. 20, 2016 – More than 1.2 million Walmart U.S. and Sam’s Club associates will receive a pay increase under the second phase of the company’s two-year, $2.7 billion investment in workers. The pay raise, which takes effect Feb. 20, will be one of the largest single-day, private-sector pay increases ever. As an industry leader for competitive pay and benefits, Walmart is also implementing new short-term disability and simplified paid time off (PTO) programs. The combined changes will expand support for associates dealing with extended health issues and provide associates greater control over their paid time away from work.
“We are committed to investing in our associates and to continuing to simplify our business. When we do so, there is no limit to what our associates can accomplish,” said Judith McKenna, chief operating officer for Walmart U.S. “Our customers and associates are noticing a difference. We’re seeing strong increases in both customer experience and associate engagement scores. Five straight quarters of positive comps in our U.S. business is just one example of how helping our associates grow and succeed helps the company do the same.”
This associate investment was taken into account in the financial outlook discussed last October at the company’s annual analyst meeting. Today’s announcement addresses the details for associates. Specifics are provided below.
A job at Walmart means competitive pay for all associates. Every year, the company promotes 160,000 associates to jobs with higher pay and more responsibility and last year Walmart converted more than 150,000 associates from part-time to full-time. On Feb. 20, 2016, the company will implement one of the largest single-day, private-sector pay increases ever, benefiting more than 1.1 million hourly associates. The changes taking effect include:
- All associates hired before Jan. 1, 2016 will earn at least $10/hour.
- New entry-level associates will continue to start at $9/hour and move to at least $10/hour after successfully completing the company’s new retail skills and training program known as Pathways.
- Associates already earning more than $10/hour will receive an annual pay increase in February rather than waiting until their anniversary date.
- Walmart is raising the starting rate of its non-entry level hourly pay bands. Anyone earning below the new minimum will automatically move up to the new minimum.
- Associates at or above their pay band maximum will receive a one-time lump sum payment equal to 2 percent of their annual pay.
- When these changes go into effect, Walmart’s average full-time hourly wage will be $13.38/hour. The average part-time hourly wage will be $10.58/hour.
Walmart and Sam’s Club are launching a new, simplified PTO policy, effective March 5, 2016 that will streamline paid vacation, sick time, personal time and holiday time into one category. And the one-day wait to use sick time will be eliminated, as promised. When the plan rolls out in March, both full- and part-time associates will earn PTO based on tenure and hours worked. The plan includes:
- No waiting. PTO is available to use as soon as it’s earned and can be used for almost any reason.
- Full-time hourly associates can carry over up to 80 hours (48 hours for part time) of PTO from year to year.
- Any unused hours at the end of the year above the 80 hour and 48 hour limits will automatically be paid to hourly associates in the first paycheck every February.
- Associates will also keep any existing and accrued sick and personal time. These balances will be kept separate, to be used for certain circumstances once all available PTO is used.
In addition to PTO, Walmart is providing a new, Short Term Disability Basic plan at no cost to full-time hourly associates. Effective Jan. 1, 2016, the plan offers more financial protection to workers who need to be away from work for an extended period of time due to their own medical needs such as an illness, injury or having a baby. The basic plan will pay 50 percent of a worker’s average weekly wage, up to $200, for up to 26 weeks. Walmart is also offering a Short Term Disability Enhanced plan, which costs less than the company’s prior voluntary plan and provides more coverage. Associates would receive up to 60 percent of their average weekly wage with no weekly maximum for up to 26 weeks.
Walmart’s associate investment is about more than wages and benefits: it is designed to provide associates the tools they need to grow with the company and provide great customer service. The company is also creating new training programs, which will create clear career paths from entry-level positions to jobs with more responsibility and higher pay.