BENTONVILLE, Ark.--(BUSINESS WIRE)--
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 company is also creating a new benefit to assist associates with adoption expenses. The combined wage and benefit changes will benefit the company’s more than one million U.S. hourly associates.
“Today, we are building on investments we’ve been making in associates, in their wages and skills development,” said Doug McMillon, Walmart president and CEO. “It’s our people who make the difference and we appreciate how they work hard to make every day easier for busy families.”
He added, “We are early in the stages of assessing the opportunities tax reform creates for us to invest in our customers and associates and to further strengthen our business, all of which should benefit our shareholders. However, some guiding themes are clear and consistent with how we’ve been investing -- lower prices for customers, better wages and training for associates and investments in the future of our company, including in technology. Tax reform gives us the opportunity to be more competitive globally and to accelerate plans for 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 one-time bonus represents an additional payment to associates of approximately $400 million in the current fiscal year, which ends Jan. 31, 2018.
While the new law will create some financial benefit for the company, Walmart is early in the process of assessing potential additional investments. That assessment will be done not only through the lens of associates, customers and shareholders, but also within Walmart’s financial framework of strong, efficient growth, consistent operating discipline and strategic capital allocation. Further details will be shared, as appropriate, when the company releases quarterly results Feb. 20, 2018.
Associates will hear more from their managers in the coming days about details. But, broadly, associates in the U.S. will share in tax savings through:
- A one-time bonus benefiting all eligible full and part-time hourly associates in the U.S. The amount of the bonus will be based on length of service, with associates with at least 20 years qualifying for $1,000. A discrete one-time charge will be taken in the fourth quarter of the current year to account for the bonus; qualification will be determined before the end of the month and payments will be paid as quickly as practical thereafter.
- An increase in Walmart’s starting wage rate to $11 an hour, effective in the Feb. 17, 2018, pay cycle. The change is in addition to wage increases already planned for many U.S. markets in the coming fiscal year. The increase applies to all hourly associates in the U.S., including stores, Sam’s Clubs, eCommerce, logistics and Home Office.
- An expanded parental and maternity leave policy, providing full-time hourly associates in the U.S. with 10 weeks of paid maternity leave and six weeks of paid parental leave. Salaried associates will also receive six weeks of paid parental leave.
- Walmart will provide financial assistance to associates adopting a child. The adoption benefit, available to both full-time hourly and salaried associates, will total $5,000 per child and may be used for expenses such as adoption agency fees, translation fees and legal or court costs.
Wal-Mart Stores, Inc. (WMT) helps people around the world save money and live better - anytime and anywhere - in retail stores, online, and through their mobile devices. The company’s legal name will become Walmart Inc., effective on Feb. 1, 2018, to reflect its growing status as an omni-channel retailer. Each week, over 260 million customers and members visit our more than 11,600 stores under nearly 60 banners in 28 countries and eCommerce websites. With fiscal year 2017 revenue of $485.9 billion, Walmart employs approximately 2.3 million associates worldwide. Walmart continues to be a leader in sustainability, corporate philanthropy and employment opportunity. Additional information about Walmart can be found by visiting http://corporate.walmart.com, on Facebook at https://facebook.com/walmart and on Twitter at https://twitter.com/walmart.
This press release contains a number of forward-looking statements. Words, and variations of words, such as “will,” “expect,” “should” “may,” “estimate,” “deliver” and “target” and similar expressions are intended to identify the Company's forward-looking statements, including, but not limited to, statements about the change in wage rates, the one-time cash bonus, the charges to earnings and the impact of tax reform. These forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond the Company's control, which could cause the Company's actual results to differ materially from those indicated in the Company's forward-looking statements. Please see the Company's risk factors, as they may be amended from time to time, set forth in its filings with the U.S. Securities and Exchange Commission, including the Company's most recently filed Annual Report on Form 10-K and in the Company’s Quarterly Report on Form 10-Q for its fiscal quarter ended October 31, 2017. Wal-Mart Stores, Inc. disclaims and does not undertake any obligation to update or revise any forward-looking statement in this press release, except as required by applicable law or regulation.