Walmart has announced it is joining the list of U.S. companies awarding employees with bonuses in light of the Republican tax plan passing. Along with handing out checks of up to $1,000, Walmart will also raise its base pay rate to $11 per hour.
Walmart's wage increase will take effect in February. The company said the one-time bonuses would cost the company $400 million and will be based on length of service. Employees who have worked for at least 20 years will get the full $1,000, but most will get up to a few hundred dollars.
Along with wage increases and bonuses, the company will also increase paid maternity leave benefits for full-time hourly employees from six to eight weeks at half pay to 10 weeks at full pay. Further,
Walmart is also increasing its paid leave policy for new fathers and non-birthing mothers to six weeks at full pay for full-time hourly workers. Previously, the company didn't offer any paid leave for them.
Walmart's CEO indicated the company's ability to offer such gracious increases is the result of Trump slashing corporate tax rates:
“Today, we are building on investments we’ve been making in associates, in their wages and skills development,” Walmart CEO Doug McMillon said in a statement. “It’s our people who make the difference and we appreciate how they work hard to make every day easier for busy families.”
McMillon said Trump's corporate tax cut "gives us the opportunity to be more competitive globally and to accelerate plans for the U.S.”
But other's disagree, saying it's merely a publicity stunt:
Economists have argued that one-time bonuses, while significant for workers living paycheck-to-paycheck, are not as meaningful as permanent wage increases. Critics of tax reform have said companies are dishing out bonuses for the sake of good publicity and to curry favor with the White House.
"Wal-Mart would have had to go to at least $11 in many markets in order to retain reliable employees," said University of Michigan business professor Erik Gordon. "The tax cut made it easier for the company to swallow."