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Walmart's image problem under scrutiny at annual shareholder meeting

Activists and a new study link poor pay, staffing problems to company's lagging sales

Walmart workers speaking at the company’s annual shareholder meeting in Bentonville, Arkansas, on Friday said the megastore’s staffing problems and poor pay were hurting the company’s image and contributing to lagging sales.

Their statement comes after a week of rallies across the country by labor activists, union representatives and workers in cities such as Chicago; Dayton, Ohio; and Baton Rouge, Louisiana. The demonstrators have taken aim at the plight of the company’s low-wage employees and the burden they say Walmart’s staffing policies place on working mothers.

On the floor at the shareholder meeting, Walmart worker and shareholder Charmaine Givens-Thomas, a member of activist group OUR Walmart, linked staffing shortages at Walmart stores to the company’s performance. Walmart has reported declining sales for five consecutive quarters, as well as up to $3 billion per year in losses due to stocking problems.

“Backrooms are piling up because there aren’t enough people to get things on the floor,” Givens-Thomas was quoted as saying in a statement from OUR Walmart. “We struggle to deliver the customer service we pride ourselves on. And without excellent service, sales suffer.”

A study released Friday by Lake Research partners found 25 percent of Walmart’s “most loyal” customers were shopping there less because of perceptions about how the company treats its workers. Among consumers who rarely or never shop at the megastore, 27 percent said it was because of “poor treatment” of workers while another 26 percent cited poor pay.

“Walmart’s reputation as a low-paying employer is becoming a growing problem for the company’s bottom-line,” Lake Research said in a press release. “The good news for Walmart is that over a quarter of consumers confirm that if Walmart’s treatment of workers improved, their likelihood of shopping at the retailer would increase.”

In Phoenix, workers protested at the home of a member of the Walton family, which owns Walmart. The workers accuse the family of benefiting from Walmart’s use of tax breaks and subsidies while profiting at the expense of employees who rely on food stamps.

While the demonstrators aim to call attention to the struggles of the working poor, they have given particular attention to working mothers, who are a significant percentage of Walmart workers.

“If Walmart were to raise their wages to pay $25,000 a year for full-time work, we could lift as many as 1.5 million people out of poverty,” said Moira Bulloch, spokeswoman of the Union for Food and Commercial Workers (UFCW), a backer of OUR Walmart. She said hundreds of workers nationwide had come out to protest.

Walmart is the country’s largest employer of women, according to the National Women’s Law Center, which says that in the United States nearly two-thirds of low-income workers are women, including many single mothers struggling to take care of their families.

The fact that American women disproportionately hold the retail industry’s lowest-paid positions results in a $40.8 billion pay gap between men and women in the industry, according to a report published Tuesday by Demos, a liberal think tank.

Monica Hilliard, 27, an employee at a Walmart store in Arlington, Texas, said her job does not come with health insurance, despite working 40 hours per week. She takes care of her father, who needs hospital care.

Hilliard, a member of OUR Walmart, said she went on strike on Tuesday to protest her wages. “Hopefully it benefits us in the long run,” she said.

Walmart dismissed the round of protests in a statement as a “PR stunt” by the UFCW. The company says the union makes “preposterous claims about participation” in these yearly demonstrations.

“About 100 of our 1.3 million associates around the country participated in this week’s demonstrations,” a Walmart spokesman said — a number that he said was “less than last year.”

“Typically the union will have maybe one associate at a demonstration and then fill out the rest of group with union members from our unionized retail competitors or paid protesters,” he said. “Our associates have access to health benefits for a little as $36 a month, a 401(k) program with a 6 percent company match, bonuses based on the performance of their stores and education and training opportunities.”

This isn’t the first time Walmart has been in the spotlight for allegedly mistreating female employees. In 2011 the Supreme Court threw out a class action seeking compensation for 1.5 million women workers who had sued the retail giant for wage discrimination amounting to billions of dollars. Activists have since launched lawsuits on a smaller scale in several states.

In January 2013, A Better Balance, an activist group that promotes the rights of working families, wrote to Walmart to request the company change its pregnancy policies, which employees said violated the Americans with Disabilities Act and 1978 Pregnancy Discrimination Act. The company changed its rules in March in what UFCW’s Bulloch called a “victory” for female workers, who were often required to continue labor-intensive work such as heavy lifting, which some said resulted in pregnancy complications.

Bulloch said Walmart “drives down wages for women in retail across the country, forcing their families to make hard decisions to survive on these wages.”

“They’re driving the race to the bottom,” she added.

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