Mexico's Supreme Court has ruled that Wal-Mart de Mexico, also known as Walmex, violated the country's constitution by paying workers, in part, in vouchers only redeemable at the store. Walmex is a wholly-owned subsidiary of Wal-Mart Stores Inc. (NYSE: WMT).
That's right: Wal-Mart was trying to pay its workers with gift cards. That sounds bad but it's really not quite as messed up as it seems. The Wall Street Journal reports (subscription required) that "the retailer said the program was voluntary, and designed to help our employees acquire basic necessities." It went on to explain in the statement that under the program, "Walmex would put store credit on electronic cards and the employees could contribute a matching amount."
Here's what I don't understand: if the company wants to offer employees the option of being paid with store credit -- and employees want to take advantage of the offer -- whose rights are being violated?
The reality is that Wal-Mart offers compelling values on household items and, for many low-income workers, the chance to receive a portion of earnings in store credit would be a good opportunity. If it isn't, they don't have to take it!
I'm not sure why the courts needed to get involved here.











Reader Comments (Page 1 of 8)
9-06-2008 @ 3:37PM
DUTCH said...
WHATS WRONG WITH IT? IT WREAKS OF THE OL SLAVERY TRADITION OF OWEING YOUR SOUL TO THE COMPANY STORE !! WAKE UP YOU WILL BECOME AN ECONOMIC SLAVE...AND MEXICO..PASS A DECENT MINIMUM WAGE FOR YOUR CITIZENS !!
9-06-2008 @ 3:39PM
william lindblad said...
Does Mexico have any kind of an income tax? WalMex have any competitors that might be trying to get the employee's money?
Couple of possibles.
Best reason would be the class structure itself which is only rich and poor and the fact that those on top don't want any newcomers.
That is why we have border crossing issues.
9-06-2008 @ 3:53PM
Larry said...
Sounds like the Old Company Store in the coal mining field of years ago, before long Walmart will want to pay in tokens also so their workers will have to buy from them.
9-06-2008 @ 4:22PM
harley said...
who cares what goes on in drug infested mexico as long as they stay on their side of the boarder
9-06-2008 @ 4:42PM
JJ said...
jus' a little modern day sharecropping
9-06-2008 @ 4:59PM
jerry mcdonald said...
i bet you didn't understand when the coal miners were forced to use the company store here either!
9-06-2008 @ 4:59PM
jorge vasquez said...
Its Mexico, who cares
9-06-2008 @ 7:06PM
Tim said...
DUhhhh Mexico is a pseudo socialist country-- wait unitl we end up like this!
9-06-2008 @ 8:03PM
Kate said...
It's a way for Walmart to keep their workers money in house. I think it's a bad idea and I'm glad Mexico said, "no way". We think it's a free option, but is it really? You have no way of knowing if workers are intimidated in to accepting the gift cards to keep their jobs. Walmart has been known to be underhanded in the US. If you complain about no breaks, short lunches, you loose your job. Walmart has faced US courts several times over for failing to pay employees their full hours, or providing 15 minute breaks, or full lunch hours, discriminating against women employees, hiring illegals, or hiring contractors who hire illegals. Walmart excells at being the bad employer. It's all about Walmart's bottom dollar.
9-06-2008 @ 9:27PM
El Uterbide said...
Stupidos: Those gift certificates were bonuses, not wages--- that, by any law has to b e paid for work.
9-07-2008 @ 1:33AM
Kent said...
Sixteen tons......I owe my soul to the company store scenario. Using those vouchers in lieu of pay has a cost advantage to Wal-Mart....creative accounting at work....the store has lost its soul....I rarely shop there anymore.
9-07-2008 @ 7:44AM
Bruce Wilhite said...
Wal-Mart is a cancer. Low pay. No benefits. No overtime pay. Destroys local small businesses. Lessens the tax base, thereby weakening local infrastructure. Creates a workforce which is dependent on social welfare. Consolidates money and power in the hands of fewer people.
Et cetera
9-07-2008 @ 9:13AM
sonnype said...
I dont care for Wal-marets business practices so I dont shop there.Wal-Mart treats its people like peons and I find Wal-Marts attitude offensive.I may have to pay a little more at another store but its my choce on where to shop
9-07-2008 @ 9:34AM
michelle lane said...
i bet sam walton is turned over in his grave on how his stores are being runed
9-07-2008 @ 9:37AM
Donna said...
I agree with the coal mining analogies! Ya, Mexico needs to step up and give these people a minimum wage. Ya gotta do what ya gotta do, in regards to the workers. Walmart on the other hand, I agree, is a cancer. A giant smelly, oozing, festering sore. Thank GOD I live in a country where Walmart does not exist!!
9-07-2008 @ 9:50AM
john said...
This is a way for big business to make it possible for the institution of to wage classes and keeping it that way. The upper class and the lower class .... no more middle class. The clechet the rich get richer and the poor get poorer gets more and more evident as large coorporate giants keep pulling off stunts like this. Wal-mart has pulled off some really underhanded stunts but this is really the icing on the cake. People should be treated like people and not property. you should receive a honest days pay for an honest days work. Not a gift card to use in there store. Gift cards don't pay the bills.
9-07-2008 @ 9:53AM
jazzyjots said...
To Bruce Whilhite...Walmart does have low wages but they also have benefits. They pay overtime if it is earned but they stress that employees go home on time. That stops workers from doing an 8 hour job in a 10 hour day. They can only destroy local small businesses if they offer a product - low prices - that the consumers want. Before Walmart, you had to take a small loan to go to the corner store for milk, bread, etc. I think the small businesses priced themselves into destruction. It's no secret that you have to price shop at Walmart - not all their products are a bargain.
9-07-2008 @ 9:54AM
e. said...
leave it to walmart to screw its ppl and come out smelling like a rose.....
9-07-2008 @ 9:55AM
Gayle said...
Since Walmart marks up prices 50% and more, they should have issued cards for more than the cash wages. This is another case of big companies taking from their employees.
I grew up in a cotton mill town. Wages were low. The store, owned by the company, ran a tab till payday and everyone charged till payday. Sometimes, people would end up owing most of their check. Most lived in mill houses owned by the company. Price was cheap, and the houses were little more than shacks. But people were poor and had little choice. They could not save enough to move because the wages were too low and they couldn't quit the company because they would have no place to live. The company trapped people into poverty.
9-07-2008 @ 9:56AM
storeskeepthetaxes said...
do you know when you buy something from walmart and many other stores . ALL SALES TAXES goes right in there pocket . That's why they called it Tax Free ...these companies doesn't have to pay taxes .....
Look on your receipt and check out much taxes you pay and realize , everyone who buys items , The stores keep "sale taxes " in there pocket.