T Nation

Maryland Attacks Wal-Mart


A kick in the teeth to the great evil that is Wal-Mart. I hope the trend continues. Thoughts?

Md. forces Wal-Mart to spend more on health
Legislature overrides veto; unions seek similar laws in 30 more states

pdated: 10:43 a.m. ET Jan. 13, 2006

ANNAPOLIS, Md. - Maryland legislators voted Thursday to enact a first-in-the-nation requirement that Wal-Mart Stores Inc. spend more on employee health care. The measure, touted as a money-saver for the state-supported Medicaid program, takes effect despite the governor?s veto of the bill.

Labor unions have said they are seeking similar legislation this year in at least 30 other states. Supporters say the retailing giant unfairly takes advantage of taxpayer-funded health care plans because some workers can?t afford Wal-Mart?s health insurance.

?The taxpayers are giving a health-care subsidy to the largest retailer on earth,? argued Democratic Delegate Kumar Barve. The House and Senate, both controlled by Democrats, both notched the three-fifths margins needed to override a veto last May by Republican Gov. Robert Ehrlich.

The bill requires companies with more than 10,000 Maryland employees to spend at least 8 percent of their payroll on employee health care or pay the difference into the state?s Medicaid fund. Of the state?s large employers, only Wal-Mart spends less than 8 percent on health care.

The company employs about 17,000 Marylanders at more than 40 Wal-Mart and Sam?s Club stores, and about 1.3 million people nationwide.

Claims of ?a slippery slope?
Critics of the legislation called it a dangerous precedent that ultimately would cost Maryland jobs.

A Wal-Mart executive called the bill a poorly worded mandate for a single company. Wal-Mart spokeswoman Mia Masten said Thursday that the bill ?could be the beginning of a slippery slope.?

?We believe everyone should have access to affordable health insurance, although this legislation does nothing to accomplish that,? said Masten, who said the retailer may partially pull out of Maryland because of the bill.

She said Wal-Mart was unfairly singled out because of ?partisan politics? and that Medicaid?s problems go beyond the behavior of one company.

The veto override had been one of the session?s most intensely lobbied, with business groups taking out print ads supporting a veto and labor groups rallying and taking out their own ads siding with supporters.

The decision is being closely watched by labor unions and legislatures around the country.

?We expect that today?s vote will generate important momentum in many other state legislatures,? said Nu Wexler, a spokesman for Washington-based Wal-Mart Watch, which is funded by a union.

The unions have said the states they will focus on include Colorado, Connecticut and Washington.

Harsh words for retailer
Some Maryland Democrats had harsh words for Wal-Mart. ?Don?t dump your employees that you refuse to insure into our Medicaid system,? said the bill?s sponsor, Sen. Gloria Lawlah.

In the House, Delegate Anne Healey compared Wal-Mart to a schoolyard bully. But House Republican Leader George Edwards called the measure an unwarranted intrusion into private enterprise.

?If you don?t want to work for Wal-Mart, no one?s twisting your arms. Go somewhere else and work,? Edwards said.

The company is under legal pressures around the country.

In Pennsylvania, a judge this week approved a class-action lawsuit by employees who say the company pressured them to work off the clock. Last month, a California jury awarded workers $172 million for illegally denied lunch breaks, and Wal-Mart settled a similar Colorado case for $50 million.

The company is appealing the California verdict and may pursue an appeal of the class-action certification in Philadelphia. A spokeswoman for Wal-Mart, Sarah Clark, said a law like Maryland?s ?does nothing to help the 46 million uninsured individuals in this country.?

? 2006 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.



Same stuff's going on up here in NY. They just passed a law or are about to pass one that requires them to pay a larger contribution to their health care, and there's several other lawsuits pending.


If I was Wal-Mart I would give them the finger, close the doors, and move out of state. Hey Irish, do you really think it is a good idea for government to tell a business how to operate?

Oh yea that's right, you're a socialist. This probably does seem like a good idea to you.


This is pretty fascinating stuff!


If I'm Wal Mart, I'm suing the shit out of MD.


Wait... listen for it...

That's the sound of businesses moving out of Maryland...


Good point. I really hadn't considered that avenue.

Waddaya think BB, How strong of a case does Wal-Mart have?


Lol. Small businesses are one thing. But when you employ over 10,000 people and provide shitty healthcare for them, yea, I think it is a good idea.

You know, once upon a time it was acceptable to have eight year olds working twelve hour days in factories. It was also acceptable to be able to say , "You will not work here because you are black" or "You will not shop here because you are black". The government stepped in back then because of questionable business practices. I see it really destroyed the economy.

Although if we had been alive back in during the child labor days, you fellas probably would have thought it was fine, and that companies should abolish this, "Voluntarily". Ha.


I would love if Wal-Mart would close down and move out of my state.


I think Walmart employees probably should unionize if it is as bad as they say.

I think the state of MD has no right to force the issue.

I expect Pennsylvania, Virginia and Delaware will be getting more shoppers.


Why? Did they enact a 50% sales tax when I wasn't looking?

I am surprised people think that this is going to be downfall of Wal-Mart, and consequentially Maryland's economy. This is almost getting amusing.


It's almost amusing to me that you think that this is OK.


When it comes to economic stuff I tend to side with the right. I don't think the government should be telling Wal-mart how to run its business. Working at Wal-mart is a good stepping stone job - you work there, gain experience, move on to something else. Not every job needs to be the ideal job, nor should it be.


You have a point nephorm that its unfair to single out a particular company. Well walamart has been overdue for a while now on a lot of things based on its growing unpopularity. im just seeing both sides of the arguement and if wally world doesnt want these kinds of actions in the future , it should do more corporate responsibility stuff.


This kind of thing discourages "corporate responsibility stuff." And that kind of logic is scary anyway. If RedCross gets the legislature to pass a measure that says I'm forced to donate $100 a year to them, saying "Hey, if you don't want these kinds of things in the future, you should donate more to charity" doesn't cut it. Maryland had better be careful... we've had a lot of businesses moving in over the past couple of years, mainly due to the lower cost for rent and land compared to Virginia and DC. Creating a business-hostile environment, could easily disturb that growth, and drive out a lot of the big money that has been pushing the MD projects forward.

No one is forced to work for WalMart. The work conditions are, to the best of my knowledge, safe. They aren't misrepresenting the salary or the health care. If people don't like it... they can get other jobs.

Did you know that in other states, Giant Food is prohibited from using electronic cashiers? Why? Because of the unions. I'm no fan of the electronic cashiers, but the principle was supposed to be that they would be more efficient and thus save the company (and therefore the consumers) money. But gee, the mafia, I mean, the union, has decided that their interests trump all others. Rather than letting the market decide, unions and socialist governments think that they know what's best for everyone; rob from the middle class, give to the poor. After all, WalMart is only going to raise prices to be able to afford this new system.


Wal-Mart is hardly the only company to take advantage of State sponsored health care. Toyota recently choose to locate their newest factory in Canada rather than the U.S. because they are saving a bundle on healthcare.(The reason being reliance on Socialized medicine for all of you not up to date on our neighbor to the north.) It's the same reason the new Tacoma factory is in Tijuana, although there because they can just say to hell with health care. Anyway, good luck taking on Wal-Mart. They will pull out of Maryland before they acquiesce. They usually close down stores that unionize. Wal-Mart has a right to protect it's business model; it's hard to argue with success.


Hmm, I'm not so sure health care is the driving factor for investing in Canada. Employers do have to contribute towards health care up here already. There is also a premium or tax for employees here in Ontario...
Since July 1, 2004 all employees working in Ontario are required to pay an additional tax called The Ontario Health Premium. This tax is deducted from pay and pensions as part of personal income tax requirements.

This government looked at all kinds of options for raising additional revenue in a visible and clearly identifiable way, and felt that an income-based premium would best achieve this goal.

No one with taxable income of $20,000 or less would pay the premium; this means:

43% of individual tax filers would not pay the premium; and 48% of senior tax filers in Ontario would not pay the premium. Individuals with taxable income of $21,000 would pay only $5 per month.

Individuals with the highest incomes would pay at least 3 times as much as those with modest incomes. The top premium is $900; whereas, an individual with taxable income of $35,000, for example, would pay $300.
In addition to deducting the employee premium, as well as pension and income tax deductions for remittance to the government, the employer has health related expenses to pay:

Effective January 1, 1999, "eligible employers" (generally private sector) are exempt from the Employer Health Tax (EHT) on the first $400,000 of annual total Ontario remuneration. Eligible employers pay EHT on Ontario remuneration in excess of $400,000 at 1.95%.

Prior to these programs, which were required due to the increasing burden of health care costs, they would have been funded via general tax revenues within the province.

Regardless, I think factors such as the exchange rate, cost of living, total cost of employee wages, availability of trained and motivated employees, access to markets and so forth all plays a role in locating a factory or other long term investment of this nature.

It is very possible that total health care costs to companies are lower in Canada, I don't know, but that certainly isn't the ONLY reason that someone would locate here, in the land of ice and snow.


Uhmm of course government has the ability to tell a business how to operate. Business shouldn't be able to tell the government how to run things, which is what wal-mart does. Why am I paying for wal-mart's healthcare? They can pay their own. Of course you're a "conservative" so you believe very strongly in giving free money to rich companies.(corporate welfare)


Uhh...Wal-mart is deliberately stealing your money. The government is telling them to stop. And Wal-mart could be a much better company to work for and still be a great business...See COSTCO for details.
full disclosure: I own COST.


It looks like you really don't understand how business works.

Walmart will raise prices in MD to compensate. Shoppers will go to other stores in MD or will drive across the border to get lower prices.

MD is a small state and they already cross the border for many purchases. This will encourage the behavior.

In the long run the only people that will be better off will likely be the union bosses.