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Latest News - June 2010

June 21, 2010
Wal-Mart offers $8.75-an-hour wage, union balks
Source: Chicago Sun Times
By: FRAN SPIELMAN City Hall Reporter

Wal-Mart offered Monday to pay its Chicago employees a minimum urban wage of $8.75-an-hour to break the stalemate that has stalled its $1 billion plan to build “several dozen” Chicago stores over the next five years.

After six years of stonewalling labor’s demand that Wal-Mart pay its employees a “living wage,” the world’s largest retailer yielded to pressure from Mayor Daley to establish a new standard for Chicago.

The $8.75-an-hour minimum Chicago wage would be 50 cents above Illinois’ minimum wage, but far short of the $11.03-an-hour unions have demanded.

Jorge Ramirez, secretary-treasurer of the Chicago Federation of Labor, promptly rejected the offer outlined during the second face-to-face meeting between Wal-Mart and organized labor and the first since May 3.

“It’s 50-cents above the minimum wage. The big-box ordinance was $11.03-an-hour, plus $3 in benefits. Folks in our coalition are outraged that they wasted our time for a month-and-a-half and came up with something they knew would not be acceptable,” Ramirez said.

“This is a straight muscle play by Wal-Mart to ram this down the City Council’s throat. Aldermen are gonna see through it.”

Zoning Committee Chairman Danny Solis (25th) was disappointed that the wage concession was not enough to break the stalemate.

“It’s 12,000 jobs, 2,000 [of them] construction jobs. It’s dozens of stores in food desert wastelands. If the unions look at it, they should reconsider their position,” said Solis, a Wal-Mart supporter.

Barring a change of heart by labor, Solis predicted that a proposed Pullman Park Wal-Mart would fall “one or two” votes short at Thursday’s Zoning Committee meeting.

“In the full Council, it could pass, but by a very slim margin,” which is not what Daley wants, he said.

During a City Hall news conference that was more like a pep rally, Ald. Anthony Beale (9th) tried to turn up the heat on his City Council colleagues.

“Is there an alderman here today who’s gonna turn their back on 12,000 jobs here in the city of Chicago? I don’t think so,” he said.

Hank Mullany, president of Wal-Mart North, said the company is prepared to spend $1 billion over the next five years building “several dozen” Chicago stores that create 10,000 permanent jobs and 2,000 construction jobs.

They would would range from 141,000-square-foot super-centers to 60,000-to-80,000-square-foot mid-sized stores and food and pharmacy stores with just 25,000 square feet.

Asked whether those stores would be new construction or take over vacant storefronts, Mullany said, “We would look at both. We would take over existing retail boxes, if they were available. We’d build ground up. Frankly, it will be a combination of both.”

Daley has been searching for the “next big thing” ever since Chicago’s first-round flame-out in the 2016 Olympic sweepstakes and he’s apparently convinced that Wal-Mart expansion is it.

Last week, he met privately with Wal-Mart executives while attending the U.S. Conference of Mayor’s meeting in Oklahoma City and pressured the world’s largest retailer to up the ante.

With dozens of stores and thousands of jobs hanging in the balance, the mayor is now hoping organized labor’s City Council allies will be afraid to say “no.”

But, Ramirez said, “Wal-Mart doesn’t make this investment out of a sense of corporate largess. They’re not gifting the money. They’re doing it because they have to invest in an urban market. Their stockholders are demanding it.”

In 2004, a bitterly-divided City Council gave Wal-Mart zoning approval to build its first Chicago store in Austin — and handed the retailer a one-vote defeat in Chatham.

The controversy gave birth to the big-box minimum wage ordinance snuffed out by Daley’s 2006 veto. Organized labor subsequently spent millions to elect a more union-friendly City Council.

The last thing Chicago aldermen want is an instant replay in the February 2011 election. They can only hope that an agreement between the two sides will let them off the hook.



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