Workers Say Target's Move To Increase Minimum Wage Has Backfired
Target employees across America say they are suffering from a decrease in hours after the company said it would raise the minimum wage to $15 an hour by 2020, according to a report by CNN Business.
The dozens of former and current Target employees interviewed said that less hours have made it difficult or even impossible for them to pay their bills or get health insurance.
“I got that dollar raise but I’m getting $200 less in my paycheck,” said Heather, a employee whose hours were cut from full-time to 20 hours per week. “I have no idea how I’m going to pay rent or buy food.”
Target employees become eligible for health insurance if they average over 30 hours a week. However, a number of employees who were working more than that say they have had their hours scaled back against their will.
Caren Morales, a former employee of a Target store in California, was working 35-40 hours per week on average.
“Target worked me hard from mid-July of 2018 to February 2019, right before my medical coverage was about to kick in,” she told CNN Business. Morales says the company sent her a letter in February about signing up for health insurance benefits, but soon, her hours were cut to as low as 15 per week.
“They cut my hours right then,” said Morales. “And so I begged for hours and always went above and beyond. I called in on May 1 and said, ‘I can’t come in today or ever again because I can’t afford my daughter’s daycare. You guys cut me really bad.’”
Two years ago, Target said it would raise its minimum wage to $15 an hour by the end of 2020. But some store workers say the wage increases aren’t helping because their hours are falling, making it hard to keep their health insurance or pay their bills. https://t.co/4MZ3iBJ8lZ
— CNN Business (@CNNBusiness) October 14, 2019
Workers say the reasons Target gave them for the cuts varied; some were told there were not enough hours available, while others were told the managers weren’t able to incorporate more hours into the budget. Others were given no reason at all.
CNN Business outlined several reasons this might be happening that coincide with other current retail trends.
Target is modernizing their stores “to create a better, more inviting experience for our guests,” COO John Mulligan told CNN Business. Stores are adding more self-checkout machines and minimizing backroom shifts.
But self-checkout machines don’t require health benefits like full-time workers do.
“Older cashiers were used to getting 30-some hours and they were getting less and less,” a former store director said. “They really cut those hours back from them with the introduction of self-checkout.”
Lonnie Golden, professor of economics and labor studies – employment relations at Penn State University-Abington, has done extensive research on the decline of full-time hours.
She says that retail stores are more inclined to hire a lot of part-time workers instead of full-time employees because part-time employees don’t require expensive health coverage, guaranteed hours, paid time off or overtime pay.
According to the most recent data from the Bureau of Labor Statistics, there was an 8 percent decrease in retail workers’ hours from July of 2018 to July 2019.
Having more part-time workers also helps the company with labor costs and allow stores to move workers’ hours to cover peak times.
However, Target denies that this is its strategy. In response to the CNN Business story, a spokesperson said “that the company’s mix of full-time and part-time workers has remained consistent over the past few years and the percentage of existing hourly workers eligible for health insurance has remained steady.”
The spokesperson added that existing employees are averaging “approximately the same number of hours” as they were over the previous two years, and even slightly more than three years ago.
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