Political Animal


December 02, 2012 12:51 PM Report: Walmart plans to deny health care benefits to new employees

By Kathleen Geier

Why the ACA can’t kick in soon enough, part the infinite: the Huffington Post is reporting that, according to a new policy that will take effect in January, Walmart will begin denying health insurance to new employees who work less than 30 hours a week. It will also reserve the right to cut health benefits for certain groups of current employees who work less than 30 hours. Walmart workers, like many retail employees, often have shifts and hours that vary from week to week, according to seasonal business cycles, so even workers who are currently working 30 hours or more could be affected.

Let’s not forget that Walmart is the nation’s largest private employer, so this change is hugely important. And it’s important not only in itself, but in the spillover effect it could have on the employment policies of comparable retailers.

The Huffington Post observes that the point of the new policy is to opportunistically take advantage of certain aspects of Obamacare:

Among the key features of Obamacare is an expansion of Medicaid, the taxpayer-financed health insurance program for poor people. Many of the Walmart workers who might be dropped from the company’s health care plans earn so little that they would qualify for the expanded Medicaid program, these experts said.

“Walmart is effectively shifting the costs of paying for its employees onto the federal government with this new plan, which is one of the problems with the way the law is structured,” said Ken Jacobs, chairman of the Labor Research Center at the University of California, Berkeley.

This is yet one more example of why last week’s historic worker protests against Walmart were so important. I’ll add this reminder: it doesn’t have to be this way. Some highly profitable players in the retail game which are comparable to Walmart, such as Costco, manage to treat their workers decently. The reason Walmart runs its business in such a reprehensible manner is because it actively chooses to do so.

Kathleen Geier is a writer and public policy researcher who lives in Chicago. She blogs at Inequality Matters. Find her on Twitter: @Kathy_Gee


  • Fess on December 02, 2012 2:37 PM:

    “Walmart is effectively shifting the costs of paying for its employees onto the federal government with this new plan..."

    Actually, they've been doing variations on this for years. Their employees make so little, their children qualify for free or reduced lunches at school. They likely need food from their local Food Banks, and will be the recipients of the many canned food collections this month. Employees who currently aren't covered by insurance and have a serious illness or accident can't pay the bills, so who does? Got it. WalMart is the quintessential "taker."

  • Sandy on December 02, 2012 2:44 PM:

    This is why I decided to drop my Humana-Walmart Medicare part D prescription drug coverage for 2013 as a protest. I'll not shop at Walmart anymore either

  • emjayay on December 02, 2012 3:00 PM:

    And you can be certain that they will make sure that as many employees as possible work less than 30 hours a week. And it's not just WalMart - they're just the biggest and the leader in shafting employees. Because they can. All big box retailers including Home Depot do the same stuff - 70% of HD workers are part time.

    We need European Socialist style national legislation about a lot more paramaters of employment.

  • c u n d gulag on December 02, 2012 3:05 PM:

    Unfortunately, it'll take many many generations until the heirs of the Walton family finally get their commeuppance.

    I'm doing my part now. I no longer shop there, and haven't in years. They are one of the scummiest families, and companies, in the world.

    It's too bad a lot of people can't boycott the company. When Walmart moves in, food, hardware, and clothing stores, among others, that were local, go out of business - so where else can people do their shopping, when everything local that they once had, is gone?

    The Walton family is a family that is no better than a drug pusher. They give an area a "taste," drive the other stores out of business, and then have a monopoly.

    Actually, I have more respect for drug pushers - they usually started off poor, too, just like their intended victims.

  • golack on December 02, 2012 3:38 PM:

    I'd love to pay my workers more, I really would, but then they'd lose all their benefits, and we can't have that, can we. Indeed, I want everyone to have benefits, so time and wage cuts all around! Merry Christmas to everyone!

  • Anonymous on December 02, 2012 4:08 PM:

    golack:my hubby hasn't gotten a raise (in real dollars) for 15 years though he's doing the same kind of work. I suspect much of that is due to the rising cost of health insurance. I suspect most employers are doing the same.

    As for Walmart, Congress needs to pass a bill/patch to the ACA to deal with these "deadbeats" so that taxpayers aren't subsidizing the richest family in America and other giant corporations. And Congress needs to raise the minimum wage to at least $10/hr.

  • exlibra on December 02, 2012 4:34 PM:

    Fess, @2:37PM is right -- they've been pulling similar tricks for years. emjayay, @3:00PM, is also right -- WalMart is far from being the only employer who heavily depends on "part time" workforce; 20+ yrs ago, I worked for a third-rate (private) college, where only the department chair and its secretary were full time, while the rest of us were part time (or "part time"). And it's my understanding that the "part time" practice is common among many of the large retailers, *specifically* to avoid having to provide "benefits" (paid vacations, health care, etc).

    BTW. I tend to put quote marks around "part time", when that time is 30 hrs (sometimes, it's even 35) a week. Traditionally, "part time" meant half or less of the work week (48hrs), so that one could still work full time somewhere else. With 30 or 35hr "part time" job, you can't. At best, all you can do is get another part time (or "part time") job -- also without any benefits. That might be enough to keep you from starving, but you're always just a health calamity away from being on the street. What's more, being consistently overtired and suffering from lack of sleep, makes that calamity happening an almost sure thing.

  • DRF on December 02, 2012 4:44 PM:

    Alice Walton, one of the 2nd generation of the family, has spent tens of millions of dollars to acquire art for and to build an art museum in Arkansas. If she would contribute an equal amount of money--which would still leave her with the bulk of her inherited fortune, and her siblings were each to contribute an equal amount, to an entity which would fund, or at least significantly subsidize, health insurance for all of the Walmart part-time workers, the problem would be solved.

  • emjayay on December 02, 2012 5:14 PM:

    I just wrote a long and no doubt brilliant comment. I was sure I got the Captcha right. It wasn't. I went back to the comment. It was gone. I hate Captcha.

    Note to self: copy brilliant comments to clipboard before attempting to post.

  • Anonymous on December 02, 2012 7:19 PM:

    Let's see. This article in the sports section of the St. Louis Post-Dispatch / St. Louis Business Journal reads: Stan Kroenke buys $133 million Montana ranch, nearly 5,000 cows
    St. Louis Business Journal by Greta Weiderman, Web Editor
    Date: Thursday, November 29, 2012, 12:26pm CST - Last Modified: Thursday, November 29, 2012, 5:04pm CST

    As I see it, the more shoppers WalMart has, the bigger a spread(s) the Kroenkes can buy. I'm not adverse to a businessman/woman enjoying the benefits of his fair investment, but when we couple the article above in the Washington Monthly with this article in the Business Journal, I do have a lot of questions. Really--a LOT of questions! But, I do have one answer: I haven't bought anything from Walmart/Sam's in over 7 years, and you'll often find me enjoying a 'gourmet' hotdog at Costco. And, quite often, you'll find me kibbitzing over the coffee pot at a local mom & pop hardware store (prices are just about the same as HD), or at the local midtown bookstore, where owners actually have read many of the books on their shelves and know the authors I like. Stan can have his cows.

  • paul on December 02, 2012 9:28 PM:

    With "just in time" scheduling, it's even worse for Walmart and other retails workers. There aren't a lot of part-time jobs where you can say "I'll have 20 hours to work for you sometime between 7 am monday and 11 pm saturday, but I won't know what they are until they happen." The workers effectively are on call for 60-70 hours a week but get paid only for when Walmart needs them working full tilt. (You'll note that for fulltime workers this kind of thing is known as a split shift and is unlawful in many locations.)

    Also look for a lot more wage theft by managers forcing workers to clock out at 29.5 hours whether they stop working or not.

  • SecularAnimist on December 03, 2012 11:25 AM:

    Kathleen Geier quoted Ken Jacobs: "Walmart is effectively shifting the costs of paying for its employees onto the federal government with this new plan, which is one of the problems with the way the law is structured."

    Well, if we had single-payer Medicare For All -- government-run, tax-funded, nonprofit health insurance under efficient, open, accountable public administration -- then Walmart could shift the cost of its employees' health care ENTIRELY onto the Federal government.

    No problem.