Today, Walmart announced plans to increase the starting wage rate for all hourly associates in the U.S.to $11, expand maternity and parental leave benefits and provide a one-time cash bonus for eligible associates of up to $1,000.
The minimum wage increase comes about a year after Walmart hiked hourly pay to at least $10 for most workers.
All full-time and part-time employees will be eligible for the bonus with the amount based on length of service. Walmart didn't explain exactly how the sliding scale will work, but said the total value of the bonuses will be $400 million. Salaried employees will also receive six weeks of paid parental leave.
For the first time, Walmart also promised to help with adoptions, offering full-time hourly and salaried workers $5,000 per child that can be used for expenses such as adoption agency fees, translation fees and legal or court costs.
The retailer said Thursday that changes to its compensation and benefits policy will impact more than a million hourly workers in the U.S. The company employs 1.5 million people in the U.S.
This increase in wages to associates will take effect in February and will be approximately $300 million incremental to what was already included in next fiscal year's plan.
The Republican plan cuts the corporate tax rate from 35 percent to 21 percent. The tax law gives the retailer an opportunity to be more competitive globally and to accelerate investment plans for the United States, he said.
"Wal-Mart would have had to go to at least $11 in many markets in order to retain reliable employees", said University of MI business professor Erik Gordon. The one-time bonus is an additional payment to associates of about $400 million in the current fiscal year, which ends January 31. Salaries associates will also receive six weeks of paid paternal leave. Previously, the company didn't offer any paid leave for them.
Walmart said hourly employees at its websites, distribution centers and its Bentonville, Arkansas, headquarters, will benefit from the wage increase.
The company will also expand hourly leave, "providing full-time hourly associates in the USA with 10 weeks of paid maternity leave and six weeks of paid parental leave", it says. Job postings at an Amazon warehouse in OH, for example, offer a starting pay of $14.50 an hour.
Plus, Walmart knows from experience what raising wages can do to help boost business. Currently, Walmart's starting wage is $9, which goes up to $10 once employees complete a training program. It has done well and strengthened its hand in online retail as many other retailers have struggled.