Walmart supply chain: warehouse staff agencies accused of wage theft
‘They prey on people living on the edge,’ claim workers, who are already among the most vulnerable and lowest-paid in America
http://www.guardian.co.uk/business/2012/oct/18/walmart-supply-chain-agencies-accused-wage-theft
I can state with authority that this isn’t limited to little people living on the edge of poverty. Some large government contractors (who will remain nameless since I don’t care for a lawsuit) will often require employees to work well north of 40 hours per week, charge their customers for every hour worked, yet only pay their employees for 40 hours. Since, as contractors, the company is basically paid 2-3 times what the employee gets for regular hours worked, that profit margin leaps up when the ‘overtime’ is added in. Of course, we pampered class making high salaries aren’t likely to get much sympathy from people struggling to survive on less than minimum wage, but my point is to highlight that this phenomenon is far from unique to the bottom rung of society.
I am also quite certain that Walmart is far from the only one who is (at least passively) guilty of this practice. It is certainly no cheaper for a company to directly hire and manage people according to the local laws and regulations so the very fact that the company is going with contractors is proof, in my mind, that they are expecting (deniable) shenanigans to happen which will result in less cost to them. Any alternative is simply an accounting trick to reduce the labor force (something our government has done a number of times; pay a contractor 2-3 times what an employee costs just to get that employee off the direct payroll) and comes at the expense of the stockholder. Corporations are generally incentivized by our collective short-term decision making to inflate the appearance of current profits at the expense of future profits and the long-term health of an organization and ‘outsourcing’ labor through contractors who are then incentivized to short-change their employees to make a buck is one way to get those year-end bonuses.
