Costco announced it will increase hourly wages for its American workers to more than $30 per hour. The memo said the company will increase hourly pay for its top-of-the-scale employees over the next three years.
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Which Costco workers will receive a raise?
Costco employees at the bottom of the pay scale will receive raises of 50 cents to $20 an hour, according to the reported memo. The changes will also apply to nonunion workers.
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The big box store and Costco Teamsters union, representing thousands of workers, negotiated over a new collective bargaining agreement.
What does it have to do with current negotiations?
The current contract expires on Friday, Jan. 31, and Costco Teamsters, which represents slightly less than 10% of the company’s roughly 219,000 employees nationwide, voted to authorize a strike for better pay and benefits. About 85% of union members voted in favor of the strike earlier this month.
A Costco Teamsters spokesperson told Bloomberg that the union is happy workers will be taking home higher wages. The union attributed pressure from workers to Costco’s decision.
Costco said in a statement to Reuters that with the pay increases and its benefits, it continues to “far outpace others in the retail industry.”
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Bucking the trend
In recent years, more U.S. retailers have increased pay and benefits for hourly employees to recruit and retain employees in an industry linked to low pay and hectic schedules.
A 2022 study by business consulting firm McKinsey and Company found that the quitting rate for retail workers is over 70% higher than other industries in the U.S.
However, due to the higher wages and benefits Costco offers, it has a low rate of employee turnover, Bloomberg reported.
[CRAIG NIGRELLI]
COSTCO IS INCREASING PAY FOR MOST OF ITS HOURLY AMERICAN WORKERS TO MORE THAN 30 DOLLARS AN HOUR, ACCORDING TO A MEMO SENT TO EMPLOYEES THIS WEEK AND OBTAINED BY MULTIPLE MEDIA OUTLETS.
THE MEMO REPORTEDLY STATES, THE COMPANY WILL INCREASE HOURLY PAY FOR ITS TOP OF THE SCALE EMPLOYEES, WHICH REPRESENTS MORE THAN HALF OF ITS U-S WORKFORCE, OVER THE NEXT THREE YEARS.
THE PAY WILL RISE BY ONE DOLLAR TO 30 DOLLARS AND 20 CENTS IN THE FIRST YEAR AND AN ADDITIONAL ONE DOLLAR EACH OVER THE NEXT TWO YEARS.
WORKERS AT THE BOTTOM OF THE PAY SCALE WILL GET RAISES OF 50 CENTS TO 20 DOLLARS AN HOUR, ACCORDING TO THE REPORTED MEMO.
THE CHANGES ALSO APPLY TO NON-UNION EMPLOYEES.
COSTCO AND THE UNION REPRESENTING THOUSANDS OF WORKERS ARE IN NEGOTIATIONS OVER A NEW COLLECTIVE BARGAINING AGREEMENT.
THE CURRENT CONTRACT EXPIRES FRIDAY AND COSTCO TEAMSTERS, WHICH REPRESENTS SLIGHTLY LESS THAN 10 PERCENT OF THE COMPANY’S ROUGHLY 219-THOUSAND EMPLOYEES NATIONWIDE VOTED TO AUTHORIZE A STRIKE FOR BETTER PAY AND BENEFITS.
WITH 85 PERCENT OF UNION MEMBERS VOTING TO IN FAVOR OF THE STRIKE EARLIER THIS MONTH.
A SPOKESPERSON FOR COSTCO TEAMSTERS SAID IN AN EMAIL TO BLOOMBERG, THE UNION IS HAPPY WORKERS WILL BE MAKING HIGHER WAGES AND ATTRIBUTED PRESSURE FROM UNION WORKERS TO COSTCO’S DECISION.
COSTCO SAID IN A STATEMENT, WITH THE PAY INCREASES AND ITS BENEFITS, IT CONTINUES “TO FAR OUT PACE OTHERS IN THE RETAIL INDUSTRY.”
U-S RETAILERS HAVE BEEN INCREASING PAY AND BENEFITS FOR HOURLY EMPLOYEES IN RECENT YEARS IN AN EFFORT TO RECRUIT AND RETAIN EMPLOYEES IN AN INDUSTRY LINKED TO LOW PAY AND HECTIC SCHEDULES.
A STUDY BY BUSINESS CONSULTING FIRM MCKINSEY AND COMPANY IN 2022 FOUND RETAIL WORKERS QUIT RATE IS MORE THAN 70 PERCENT HIGHER THAN OTHER INDUSTRIES IN THE U-S.
HOWEVER, BECAUSE OF THE HIGHER WAGES AND BENEFITS COSTCO OFFERS IT HAS A LOW RATE OF EMPLOYEE TURNOVER, ACCORDING TO BLOOMBERG.
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Bias Summary
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The Left
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The Center
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The Right
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Bias Distribution
39 other sources covering this story
Total News Sources
39
Leaning Left
6
Center
12
Leaning Right
4
Last Updated
2 months ago
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