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If legislation passed by the Washington, D.C., Council is signed into law, Wal-Mart Stores Inc. says it will have to “re-evaluate [its] options” with regard to six planned stores in the area. The Large Retailer Accountability Act (LRAA) requires that certain large retailers pay a starting salary of $12.50 an hour-- considerably higher than D.C.’s current minimum wage of $8.25.
Three of the stores are now under construction, with the first two slated to open in the autumn.
In a July 9 op-ed piece in The Washington Post, Alex Barron, a regional general manager for Bentonville, Ark.-based Walmart who is responsible for about 90 stores and 30,000 associates in the D.C. area, said: “[T]his legislation is arbitrary and discriminatory and … discourages investment in Washington. We have gone to great lengths to have thoughtful conversations with council members about why the LRAA would result in fewer jobs, higher prices and fewer total retail options. Most shopping dollars would stay in the suburbs, unemployment would remain in the double digits in some neighborhoods, and underserved communities would continue to have disproportionate access to affordable groceries.”
Additionally, as the mega-retailer has pointed out, major local employers Safeway and Giant-Landover are exempt from the LRAA, which the company believes would give those supermarket operators an unfair advantage. “The LRAA would clearly inject unforeseen costs into the equation that would create an uneven playing field and challenge the fiscal health of our planned D.C. stores,” noted Barron in the op-ed piece.
Consequently, if the legislation goes into effect, Walmart “will not pursue stores at Skyland, Capitol Gateway or New York Avenue,” he wrote, adding that the LRAA “would also jeopardize the three stores already under construction, as we would thoroughly review the financial and legal implications of the bill on those projects.”
According to the text of the “living-wage” legislation, it would “ensure that economic development better meets the community’s need for family-supporting jobs,” as “some large retailers pay very low wages and do not provide their employees affordable health benefits.” The council voted by an 8-5 margin to pass the LRAA, one vote short of the supermajority necessary to override a mayoral veto. Washington Mayor Vincent Gray, who backed Walmart’s entry into the area, has been under pressure from community, faith and labor activists to sign the bill into law, as well as from retail industry groups to veto it.
For its part, Walmart holds up its recent success in Chicago as an example of what D.C. should be aspiring to. “In 2006, Chicago Mayor Richard Daley vetoed an ordinance that would have arbitrarily required retailers to pay their workers more, and his decision paved the way for today’s reality: more investment in the city, more jobs for residents and more shopping options for customers,” Steven V. Restivo, Walmart’s senior director of communications, public affairs & government relations, told PG. “We just opened our ninth store in Chicago, and we employ 2,000 people in the city.”
According to Restivo, the company’s pay and benefits are fair. “Our wages and benefits meet or exceed those offered by most of our competitors, and our health care plans continue to exceed the test for affordability and quality of the ACA,” he noted. “Most of our workforce is full-time, and about 75 percent of our store management teams across the country started as hourly associates. Their average pay is between $50,000 and $170,000 a year. Our highest-earning store manager last year earned more than $250,000.”
Walmart posts its hourly full-time wage for every state in which it does business.