Friday, May 16, 2014

Walmart executive gets big bonus because food stamps were cut

Walmart workers ready to strike for fair pay and the right to
A lousy year for Walmart means employees get their hours cut but top executives get multimillion dollar bonuses. 

Many Walmart employees can't make ends meet because their wages are so low. Most of them take home less than $25,000 a year, and are forced to seek public assistance. The average full-time salary is only $27,000 a year.

Last year was a bad year for Walmart, and associates earned even less because they worked fewer hours. Top executives, though, got rewarded -- because Congress cut the food stamps that so many of their employees rely on.

The New York Times explains:
Consider the case of William S. Simon, president and C.E.O. of Walmart’s United States unit. Under Walmart’s pay plan, he would receive some incentive pay if sales grew more than 2 percent. 
The trouble was, Walmart’s United States sales rose only 1.8 percent in fiscal 2014. That meant Mr. Simon would miss his threshold. 
Enter the adjustments. 
After adjusting for certain items relating to the company’s sales, the Walmart unit eked out a growth rate of 2.03 percent in 2014. On the strength of that “adjusted” performance, Mr. Simon received $1.5 million, the proxy noted. His total compensation was $13 million last year. 
What adjustments helped Mr. Simon clear the bar? One action that the company took was to eliminate the decline in its United States sales that occurred after the government cut food stamp benefits — formally known as the Supplemental Nutrition and Assistance Program, or SNAP — by 5 percent last November. 
That reduction in benefits hurt Walmart’s sales, the company acknowledged, because many customers use food stamps in its stores. 
But for executive-pay purposes, that sales decline never happened. And that meant a bigger payday for Mr. Simon.