UNETHICAL BUSINESS

PRACTICES
Õ

    


?Õ
?  !
 !"

ë The first true Wal-Mart opened in 1962 in

Rogers, Arkansas. Wal-Mart eventually
became the world's largest retailer
 Õ #$ $
% &%
 

ë The Wal-Mart story began in 1962, when Sam Walton

opened the company¶s first discount store in Rogers, Ark.
Five years later, there were 24 Wal-Mart stores in
Arkansas ringing up $12.6 million in sales. 1968 saw the
hiring of Wal-Mart Aviation¶s first full-pilot, who
provided help to Sam and Bud Walton, as well as the
opening of the first stores outside of Arkansas, in Sikeston,
Mo., and Claremore, Okla. The company officially
incorporated as Wal-Mart Stores Inc. on October 31, 1969.
Today, 7,390 Wal-Mart stores and Sam¶s Club locations in
14 markets employ more than 2 million associates, serving
more than 200 million customers per year.
ë Wal-Mart, the big giant, the place where a lot of people
usually do their shopping for the low prices and the variety
of products was founded by |
  Walton was an
entrepreneur with an innovative vision, started his own
company and made it into the leader in discount retailing
that it is today. In fact, Wal-Mart is considered to be the
biggest company in the U.S. and it has stores worldwide .
&' "# 

$ ()
%)%


'&%& *

ë 
$
&%+% 

ë +% 
 #

ë %+%,
-
  %,  .*
ë Wal-Mart employs more people than any other company
in the United States outside of the Federal government, yet
the majority of its employees with children live below the
poverty line.´(www.pbs.org) In addition, Wal-Mart likes to
portray itself as a seller of U.S. manufactured goods but in
reality the company has products on its shelves made in
foreign countries and at questionable workshops. It would
seem that Wal-Mart encourages made in the USA´ but it
really encourages products made outside the USA. As a
result, Wal-Mart has forced many manufacturers out of
business. As a matter of fact, this big giant is facing a
significant amount of controversy for unethical business
practices. In fact, some of these unethical business
practices include the following.
?Õ!
Õ 
Õ
 UNETHICAL PRACTICES
OF WAL-MART
ë $ $ %
 , %
 ) % 
Wal-Mart is a non union organization that feels it does not need third
party intervention. So, Instead of unions, Wal-Mart has an open door
policy that encourages employees to take their complaints beyond
management.
ë Ú 
 
 
  
 
is always open
for the associates to share suggestions, ideas, and voice concerns.
Whether it¶s help with a problem, guidance or direction, or simply
getting an answer to a question. Managers also treat all discussions
fairly, with an open mind, and without bias. They maintain complete
confidentially, whenever it¶s possible. They work with the associates
to mutually resolve any issues or problems.
  
%

 $ 
$ %*
ë a The open door policy does little to help its employees but gives the
business the leverage it needs to terminate unwanted non compliant
help.
ë 2) Employees start out at lower wages than unionized corporations
and end up quitting by the end of the first year.
ë 3) Its anti-union policy is a central part of its obsession with
minimising costs.
ë 4) Wal-Mart provides managers with its infamous µManager¶s Toolbox
to Remaining Union Free¶ that states:
Staying union free is a full time commitment. Unless union
prevention is a goal equal to other goals and objectives in the
organization, management will not devote the necessary day in, day
out attention and effort.´ If there is any evidence of moves towards
unionisation, managers are ordered to phone the Wal-Mart Union
Hotline immediately.
 Statement From Human
Right Watch 2007´
ë A report entitled Discounting Rights
released by Human Rights Watch in May,
2007 outlines  

 
  
       . It
confirms what Wal-Mart workers have been
saying for years. Workers seeking a voice
on the job with the United Food and
Commercial Workers Union have faced:
 &% ,,

%+
$ %%

 " 
ë Wal-Mart works aggressively to create a 
  



      
 

 
 
 


 
ë Wal-Mart routinely
  
    and pro-
union employees and selectively enforces company policies against
pro-union workers.

ë Wal-Mart engages in   and other tactics to prevent

organizing efforts. When workers have successfully organized, Wal-
Mart has 

 ) , % &

& '
 
 %

'&' /
& + , %0.
ë Wal-Mart also prohibits employees from  
   It is unethical for Wal-Mart to prohibit employees to
talk to union representatives since according to the     
 Ú  employers are not allowed to discourage employees
from forming a union for they have that right.
 %   ! ) ! '.1.%)%,1
#$ 
 $ Õ "' /
& 
 + % 
ë . Therefore, the United Food and Commercial Workers
Union filed a complaint with the National Labour
Relations Board against Wal-Mart. The complaint, filed
with the National Labour Relations Board, alleges that
   

    
! 


        
 

ë §"##$     

   

     
  
   %&
'
 

(

      
    %|  
)

§   & But Wal-Mart denied
the charges that were brought against the company.
  "# 
 ,..%)%,#$ 

   ,
%
& 
.& +% 

ë Thus,    
 



   
   . If Wal-
Mart wants to avoid a hearing or a lawsuit in this
situation,  

 
 
  

 
   .
ë In addition, if Wal-Mart takes
  
 


 
 
    


 Unfair Treatment of Employees:

ë  , %  % 
:
Not only does the company have a history of methodically violating
workers¶ right to join a union, the Wal-Mart record on worker rights is
a laundry list of abuse.  " &
 /$ 
%/%,#)

' , & +%  % 
.
ë 
& &  + ,*
Wal-Mart has decreased health care coverage to employees while
touting its commitment to offering affordable care. Evidence suggests
that Wal-Mart may have even adopted a strategy of eliminating 

   

         

  from applying²both as measures to reduce payroll and health
care costs.
 %  % 

Õ&%! ) 
! '

ë One internal audit of 25,000 employees in 128
Wal-Mart stores in the USA found 1,371
violations of child labour laws, including minors
working too late, too many hours a day and during
school hours.
      
 
    by violating the child labour laws and
spoiling the future of the children to enrich
themselves, ignoring seniority.
 According to Newsweek
magazine
ë %  $ ' ,
 
 %
*
The Bentonville-based multinational employs thousands of
young people to pack its customers' bags.  *+##

  
,   

 
  .
Wal-Mart¶s model is fast becoming the industry standard,
as other firms slash employee wages and benefits in an
attempt to compete with the retail giant .

%,,%+) " *
  " 

 
%
$
%% 
&
%
$ 
&$ /'&% #
 
+%  %,
 # ' /
2%,&

 UNETHICAL PRACTICES
OF WAL-MART
ë #
 '' ,
*
Wal-Mart pays low wages and appears to aggressively seeks to keep
wages down.
ë ?%
%#% % 
& #$ 

& ,
,%
%#% % 
%&
&%
 
&%
 %
%#%  $ %%
 

 '
*
3 % %%,* # & )% %%, 
$ # %  $$ %%
&  

 #
2. Under payment: women are underpaid in relation to men.
 %,  +4
& ) /
#% )
%

 5%
67883 , $

%- 
#
#  " 
#$ 

% 
-%
%#% %  '
%9
/%, $

$ :88888 
# " ' /
; , %

& #$  . The suit was filed because Wal- Mart failed to provide
equal employment for women.
 ?ender Discrimination

ë Less Managerial positions to women:

In fact, there are over 70 percent of women
working at Wal-Mart, but only a small amount of
those women are managers. So, men are holding
more management positions than women.
ë Less dignity and respect to women: Wal-Mart is
the nation's largest employer of women, but
unfortunately they are being treated without
dignity and respect." (www.arkansasnews.com)
 Meeting the Challenge of
gender discrimination
ë So it seems then that discrimination is a big
problem at Wal- Mart. If Wal-Mart wants to avoid
lawsuits they need to give more job opportunities
to women and they should get paid as much as
male employees. Even though Wal-Mart is such a
successful company, they can do better if they put
a stop to discrimination for it will save them
money on lawsuits. §     

 
 
  
 
 


    
  .
 -$
%+ &
 
ë        - 

 

  

  So, those
employees who couldn¶t afford the health plan will
probably have to get their health care benefits through their
spouses or the state from our tax dollars. Wal-Mart
responded to this problem by offering discounts on health
care coverage. Members can save as much as 50% on
services not normally covered by medical insurance.´
Discounts are not enough.     
 

 
 
    


    Ú
   -
 
     

  
 


       
  +%#< ,
 %
$ $ %   /
ë       




 
    
 In fact, according to Wal-Mart¶s policy, they
are supposed to pay employees for every minute they work. But, since
Wal-Mart is such a big company, there will be cases in which
managers might do unethical things. For instance, employees were
forced to work unpaid overtime. As a result, they filed a suit against
Wal-Mart for not getting paid for overtime. So in February 2004, a
federal judge ruled that Wal-Mart should pay workers for overtime
hours´ .But, the case is still pending. In fact Wal-Mart claimed their
policy is against such work. So Wal-Mart¶s managers who required
overtime were disciplined and fired. In fact, it is Wal-Mart¶s
responsibility to make sure that people get paid. They should settle the
suit by paying their employees for unpaid overtime. It seems that Wal-
Mart needs to periodically examine its pay practices to make sure that
all employees are getting paid for all the hours worked.
 

%,
) '& '

Õ


%,
 &$)%
ë   
   

 

.    
  Wal-
Mart frequently requires its suppliers to open their books
for Wal-Mart inspection and tells them exactly where to
cut costs. When national labour or environmental standards
create a barrier to cost cutting, suppliers are encouraged to
relocate to a labour market that will enable them to
produce at the low price Wal-Mart requires. )  
    
    

    /
   
  
  
 
     


 

, %, 


 /

ë Finally,    
     


    . In fact, in October 2003 federal agents
uncovered 300 illegal immigrants employed by outside contractors
cleaning its stores.´ As a result, the company became the target of a
class action suit. So,     
  

 
  In addition,     


  
ë low wages
ë social security payments,
ë federal payroll taxes.
ë Contractual employments
ë No security of tenure
ë No payments for over time.
Immigration experts said the 

 

  
     


 
     


    Ú
   

 They often
take the low-end, low-paying jobs shunned by not just American
workers, but also legal immigrants. But, Wal-Mart claimed they hired
those particular
  ?.
 !
ë I hate wall-mart I worked there 3 years and saw many bad practices.
The final straw that made me quit was the fact that I was a full time
department manager, yet only was getting 16-22 hours a week!!!
When I asked why my hours where being cut they told me it was due
to a lack of busness.HELLO you are WAL-MART a short drop in
sales should not lead to me and my family being broke.
get things together wall-mart if you would actually pay your workers
enough to live maybe you would save money in the 'loss prevention'
department because your workers wont have to steal from you to make
ends meat!!!
Mike
Bismarck, Arkansas
U.S.A
  . 
/%
' /

/    

ë The Catskill NY Super Wal-Mart is still just under 2 years old. management
USED to be grade A quality, employee morale used to be high until
management started cycling quickly and for some reason lost MOST of its
management team that actually CARED about the store, and
employees/customers.
Now left with a severe management shortage employees are forced to work
with a long time *FRIEND* of the store manager who is an asst. manager who
is unprofessional, mean spirited, doesn't care about the employees they oversee
and speaks down to them. this member of management is bringing down
morale and the store manager and other members of management know this
and they do not care. they consistently display unprofessionalism that would
not be tolerated by a UNION. she has been overheard telling associates to stop
their meals and do small work errands (which is illegal) and clock back in
EARLY to do things for her.
Also we have a grievance that WALMART is open ALL DAY thanksgiving,
forcing employees to work long 9 hour shifts, giving them NO CHANCE to
spend quality time with their loved ones on this 
 that is supposed to be
about FAMILY.
employee morale is down more than ever. management could care less about
its workers... this isnt what Sam Walton wanted.
 !6! ÕÕ"
!"Õ=) 


=Õ 
#,,
% -"#$ 

ë In a unfortunate incident an employee was

hurt and compensation was asked but was
completely denied and the small wound was
converted into cancer because she was poor
and couldn't afford medical treatment. So in
wall mart employees are not treated as a
part of the family and business and have no
values in the eyes of management and board
as was reported by the ex-employee.
 


 " %
>
% 
ë The sentiment behind Wal-Mart founder
Sam Walton's promise of a "better life for
all" belies questionable business practices -
many that have been challenged by
employees, unions, environmentalists,
recording artists and human rights
organizations. All these challenges should
be met and it should learn lessons from their
mistakes.
 Conclusions:
ë The companies that survive are the ones that can spot ethical issues
and correct them before they become problems.
ë In this case Wal-Mart failed to acknowledge those potential problems
and they are probably going to pay for it. Thus, Wal-Mart¶s unethical
business practices have hurt its company¶s reputation.
ë If Wal-Mart wants to survive they will have to try hard to improve
their image. That is, they need to show that they care about ethics by
treating employees fairly.
ë As a result, it will attract good employees and people will have no
reason to complain about the company. In addition Wal-Mart needs to
be socially responsible in order to avoid economic harm and in order to
maintain the legitimacy granted by society.
 Õ 
% 
*

ë As Wal-Mart is not just a threat to the standard of

living of its own employees. It damages the
standard of living of numerous others in the
economy.
ë In some cases, it forces the closure of better
paying firms. Business Week estimates for every
WM supercenter that opens, two other
supermarkets will close.
 '%& % " %
%
& %
&
%  ,
ëThere should not be any
compromise on ethics and
socially responsible
behaviour,as it is giving back
to the society, other wise its
survival will be in danger.
 Say no to unethical practices

Wal-Mart's immoral,
predatory practices and
reprehensible behavior has to
be mended which is essential
for the survival of Wal-Mart
 .%)% , $&
ë
   #  $% .% % 788:
 $% .% % %
&$*<<'''$)
 ,<%+
<
 ' 
<
 
(&#
& 9.,Õ 6;6  $%3(788:
$.8(Õ ?788: &6
% ? $
 +4
 ) /
#% .
%

788:
%-

 $%,&788?
&$*<</ 

%)%0@  
 #</ 

%<
 %
<7883<33<37<

A&#
&$*<<& # &%/<B  3C3(< &#
&$*<<''''
&%, $
 #<'$"< %
<?A8:C"
788:$37&#
&$*<<'''
' ,<%


D D % 
<' # D' /
D #$
%,D%
<

D D
%,
<' #  ' #
#
 .%)% , $&
ë &? % 9!  , ;$%3?788:$7(
Õ ?788:? % '
$ $

&$*<<'''
' ,<%


D D % 
<' # D' 
/
D #$ %,D%
<

D D
%,
<' #  '
#
#
&$*<<'''
 ,


%+%
 ,<
<
$&#
&$*<<'''' # 

 #</ $%
<

$-
&$*<<'''%

 )
 #<' "# &#

&$*<<&&,# 
%$  #<&&,# 
) ,<%
:E&#
ë &$*<<'''
'(7? ,<(' # 
 %
$ ,&#