Amid Soaring Profits, Walmart to Cut Off 30,000 Workers From Health Insurance

Published on
by

Amid Soaring Profits, Walmart to Cut Off 30,000 Workers From Health Insurance

Largest private employer in U.S. announces elimination of insurance for part-time workers and across-the-board hikes in premium costs

Walmart workers on strike, and their supporters, picket in Richmond, California on November 2, 2012. (Photo: OURWalmart/flickr/cc)

Walmart workers on strike, and their supporters, picket in Richmond, California on November 2, 2012. (Photo: OURWalmart/flickr/cc)

Walmart, the largest retailer in the world and the biggest private employer in the United States, announced Tuesday it is eliminating health insurance for 30,000 of its workers and hiking the costs of premiums across the board.

The cutbacks to coverage, which many charge was insufficient to begin with, were met with immediate criticism.

"Our schedules and hours are all over the place, and I often find less than I expected and less than my family needs when I see my paycheck," said Nancy Reynolds, a member of OUR Walmart and worker at a Merrit Island, Florida Walmart store. "Taking away access to healthcare, even though many of my co-workers couldn't afford it anyway, is just another example of Walmart manipulating the system to keep workers like me in a state of financial crisis."

In a blog post announcing the cuts, Walmart's Senior Vice President of Global Benefits Sally Welborn claims the company cannot afford the cost of insurance. "This year, the expenses were significant and led us to make some tough decisions as we begin our annual enrollment," she wrote.

But according to Walmart's own data, the company is raking in high profits. For the fiscal year of 2014, Walmart "increased net sales by 1.6% to $473.1 billion and returned $12.8 billion to shareholders through dividends and share repurchases," the company states on its website. Furthermore, in 2014, Walmart was ranked number one on the Fortune 500 list for its large revenues. The Walton family is one of the most wealthy on earth and has consistently been in the Forbes 400 top ten wealthiest list since 2001.

Walmart will stop providing insurance to workers scheduled fewer than 30 hours a week, Welborn explains. As the Wall Street Journal points out, this is not the company's first cut of this kind. In 2011, Walmart slashed coverage for new employees scheduled fewer than 24 hours a week, and in 2012 it instated the same cuts to new workers scheduled under 30 hours a week.

A Reuters report released last year finds that Walmart has been systematically eroding full-time jobs in order to dodge requirements for providing health insurance required by the Affordable Care Act. Due to forced part-time work, combined with low wages, high numbers of Walmart workers rely on public assistance, including food stamps, to get by. As a result, the demands for a $15 minimum wage, and full-time employment, have become key to the numerous actions, strikes, walk-outs, and workplace organizing drives sweeping Walmart stores across the United States. 

In addition to the elimination of health insurance for part-time workers, beginning January first, Walmart will substantially increase costs for workers who do have company health insurance. For example, Welborn explains, Walmart's "most popular and lowest cost associate-only plan" will increase by 20 percent per pay period.

Walmart's cuts follow similar slashes to health care coverage from other retail giants, including Home Depot, Target, and Trader Joe's.  As the employer of 1.3 million workers in the United States alone, critics charge Walmart is driving down working standards across the retail sector. Walmart workers face retaliation when they organize to improve their conditions, including the unlawful punishment and firing of employees who take part in protests, strikes, and other actions.

The announcement follows Walmart's unrolling of its own in-store health clinics, which it hopes to place in half of its outlets, with the ultimate aim to become the "number one health-care provider in the industry," according to Labeed Diab, senior vice president and president of Health & Wellness for Walmart. These clinics offer "walk-in service, seven days a week" and "Get Well Stay Well visits at an everyday low price of $65 or less," the corporation's website states

Meanwhile, Walmart workers who are losing their insurance are on their own.

"Personally, I depend on Walmart’s healthcare, but can only work about 22 hours a week because of my health," said Reynolds. "I called the personnel office at my store and no one could tell me what these changes will mean for me. I don't know what I'm going to do if I can't get to the doctor for my diabetes and glaucoma."

Share This Article