Management 10th Edition by Richard Daft

Exercise 12

Walmart
Part Four:Organizing
World's Top Employer Ranks High on Diversity and Employee Satisfaction-But Not Everyone Hearts Walmart
For the past decade, Walmart has ranked high on Fortune magazine's list of "most admired companies," and with good reason: No one creates more jobs for the economy or career opportunities for workers than Walmart
With more than 2.1 million associates internationally, Walmart is the world's largest employer. Job candidates famously brave long lines and travel long distances for an opportunity to work at the company's new stores. The retailer's 1.4 million U.S. hourly associates earn $11.75 per hour on average, and more than 80 percent of employees-including part-time workers-are eligible for health benefits. In addition, associates at Walmart receive approximately $2 billion each year in the form bonuses, profit sharing, and 401 (k) contributions. The greatest reason workers like Walmart? The company recruits from within-a full 75 percent of store managers joined the company as hourly associates before advancing to salaried management positions.
Ad is true of most multinational corporations, Walmart is highly diverse. The company employs more then 41,000 Asian associates, 171,000 Hispanic associates, 257,000 African-American associates, and 869 000 women associates. Management's commitment to diversity is widely recognized among professional organizations-on gender diversity alone Walmart has received coveted kudos including "Top Companies for Executives (National Association of Female Exeutives). "Best Companies for Multicultural Women" (Woking Mother magazine), and "40 Great Organizations for Women of Color" (Women of Color magazine).
Despite these high accolades, not everyone is enamored of Walmet. The world's top employer is also the world's top target for special interest groups. Each year, well-funded political organization including ACORN, MoveOn.org, UFCW, and SEIU run negative publicity campaigns in an attempt to pressure Walmart to unionize. The rought-and-tumble politicking finds its most visible expression in "Wake Up Wal-Mart" and "Wal-Mart Watch," two Washington-styled anti-Walmart organizations led by campaign directors for former presidential candidates Howard Dean and John Kerry.
Dukes v. Walmart
While opposition groups present low-grade image challenges for Walmart, the retailer is facing the mother of all human-resource-related threats in the form of Dukes- v. Waknan a $500-billion-dollar discrimination lawsuit billed as the largest class action civil rights lawsuit history.
The Dukes case began back in 2000 when California Walmart associate Betty Dukes complained that she unfairly reprimanded and denied opportunities to advance in the company. Although Walmart reports that Ms Dukes clashed with her female supervisor and was appropriately disciplined for violating lunch-break polices five women joined the Dukes lawsuit in 2001 alleging a pattern gender discrimination by the company. The local incident. which initially posed a potential risk of million, of dollars in compensatory damages, morphed into a multi-billion dollar lawsuit overnight when a district judge gave the Dukes case "class action" status-a certification upheld by the Ninth Circuit Court of Appeals in 2010. As a result of the class action designation, Dukes v. Walmart is now a national lawsuit representing over 1.6 million female workers going back to 1998, none of whom have individual discrimination complaints against the company.
Walmart denies violating the civil rights of the six female employees, but the individual cases are not on trial in a class action suit. The trial now shifts to a broad examination of large companywide patterns of employment data, and plaintiffs' attorneys are claiming that women, as a class, do not receive pay and promotions equal to men at Walmart. The legal framework is enigmatic, for it forces Walmart to defend statistical discrepancies regarding gender that exist nearly everywhere in the world of business. According to nationwide studies, women are not rising in middle- and upper-level management positions at the same percentages as men. To better understand the causes of workplace inequities, researchers study a range of issues, from voluntary extended leaves to the prohibitive relocation requirements of high-paying jobs. One Cornell researcher even found that full-time working spouses hamper women's careers, mostly due to delicate work/life negotiations at home. These and other issues make climbing ladders more difficult.
In Walmart's immediate context, disparities in pay or promotions may also be attributable to retail-related tends. For example, more men than women tend to apply for higher-paying dock jobs-a trend that skews numbers toward higher average pay for men. Likewise, more women than men tend to apply for lower-paying cashier positions-a trend that inadvertently skews averages down for women. Such imbalances are consistent throughout the retail industry and occur apart from any discrimination on Walmart's part. Even so, the Dukes case, with its astronomical $500 billion penalty, is a potential company-killer. Walmart has appealed the class-action designation to the U.S. Supreme Court in hopes of dealing with individual cases, not amorphous data trends of entire classes of people. Whatever the outcome may be, the Dukes trial is scheduled to resume in 2011 or 2012.
In the end, high-powered law firms, not Betty Dukes, have the most to gain from the lawsuit. While suing alone, Ms. Dukes might have won a multi-million dollar award. But as one of 1.6 million female plaintiffs in a class, the Walmart associate is in line to receive just a few thousand dollars from a court victory. Walmart, on the other hand, stands to lose its business.
Meanwhile, back in Bentonville, Arkansas, spokes-person David Tovar reaffirms Walmart's award-winning record on human resource management: "We are proud of our work to promote diversity at Walmart and are continually recognized for our efforts."
Why does Walmarr prefer to recruit new store managers from its large pool of hourly associates?