Correction to This Article
A May 26 Business article on new Wal-Mart health benefits mischaracterized the terms of the plan. All part-timers with more than a year of service were able to take advantage of a special enrollment period. Those who previously declined coverage could enroll if they also enrolled their children.

Critics Say Wal-Mart Grows Part-Timers to Cut Benefits

Wal-Mart Stores plans to reduce the portion of its workforce that is full time to about 60 percent from 80 percent.
Wal-Mart Stores plans to reduce the portion of its workforce that is full time to about 60 percent from 80 percent. (By J.d. Pooley -- Getty Images)

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By Amy Joyce
Washington Post Staff Writer
Friday, May 26, 2006

Wal-Mart Stores Inc. is shifting a portion of its full-time employees to part-time status, company critics say, which they assert will have the effect of limiting health insurance, even though the company is expanding coverage for its part-time workers.

Company spokesman Dan Fogelman said Wal-Mart is not necessarily forcing workers into part-time schedules but is "trying to ensure that our staffing matches our customer shopping patterns. But there is no specific target number in terms of how many associates will be full time versus part time." The majority of Wal-Mart jobs are currently full time, he said.

The criticism arose after WakeUp Wal-Mart obtained detailed copies of the new health plans, which the company confirmed yesterday. The company, which announced the changes in general terms in a press release this month, is offering open enrollment for part-time workers this week only if they also enroll their dependent children, who were not eligible for coverage before. Another open enrollment will be available to all employees in October.

The new benefit plan for "Peak-Time" workers -- Wal-Mart's name for part-timers -- also shortens the waiting period for part-time employees to obtain coverage to one year from two years.

But the plan will be unaffordable for workers who are moved from full-time wages to part-time, said Chris Kofinis, a spokesman with WakeUp Wal-Mart, a group funded by the United Food and Commercial Workers union.

Many plans are offered. The "value plan" has a $23 premium per month for individuals and $65 for families, with a deductible of $1,000 per person and a family maximum of $3,000. The most popular "network saver plan" ranges from $39 to $79 per month with deductibles of $350 to $1,000.

Those workers who are moved to part-time status can keep their current health plan until the end of the year, but they will lose other benefits such as dental and life insurance, and short- and long-term disability as soon as they move to part-time hours, according to the plan document.

Employees are told if they keep the plan they had as full-time employees after they move to part-time status, however, "your cost for this coverage will not change and you may be working fewer hours."

The company has promoted the plan in recent months, saying the coverage is more comprehensive than ever.

"Wal-Mart is one of the few retailers that offers benefits to part-time associates and premiums are as low as $11 per month," said Mona Williams, a company spokeswoman. "With this special open enrollment, we have expanded eligibility and made coverage available to the children of our associates who choose to work part-time."

Full-time Wal-Mart workers have been wary of the pending changes, an employee at a south Florida store said. She spoke on condition of anonymity, fearing she could lose her job for speaking to the press.

She said she discovered last week, after checking upcoming schedules, that her full-time hours in accounting will be cut in about three weeks. She was told last week the company was shrinking her department. She then interviewed for and took a job as a customer service manager.

Part-time status will make coverage difficult, she said. "It would be really hard to afford," she said. Her current plan covers herself, three children and her husband, who is retired. The part-time plan eliminates spouse coverage, and with fewer hours, she does not think she could afford the $3,000 deductible.

A J.P. Morgan Chase & Co. report in January said the company is planning to "right size" its full-time versus part-time mix to improve productivity and reduce store labor costs. According to the report, about 80 percent of employees are full time. The company is seeking to lower that rate to about 60 percent during the next 12 to 18 months, the report said.


© 2006 The Washington Post Company

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