(Image source from: walmart.com)
In a shocking revelation by Walmart, it is closing down 63 of its Sam’s club stores across US. This move comes just after the praise it received from the White House over raising hourly pay and giving out worker bonuses due to the new corporate tax rate. The parent company Walmart announced $11 as minimum wage rate and bonuses of upto $1000. To which Ivanka Trump tweeted “America is on a roll” and White House treasury secretary thanked Walmart from White House briefing room.
Earlier on Thursday the news broke that Sam’s Club is shutting down stores across US and an unspecified stores being affected. But later Sam’s Club on its official twitter account mentioned first 53 stores being shut down and then later revising the number to 63 in it official press release. Of these 12 are planned to be converted as distribution centers.
Throughout the day customers and employees were shocked by the revelation, and they took to social media to express their anguish. It was not clear about the store details until the release gave in details of all the stores which are affected. Many employees went to work only to find the store being shut and no details further.
"After a thorough review of our existing portfolio, we've decided to close a series of clubs and better align our locations with our strategy," Sam's Club wrote in one reply. "Closing clubs is never easy and we're committed to working with impacted members and associates through this transition."
The company also tweeted privately to one person , "Pharmacies will stay open for at least two weeks, and we will work with each state's Board of Pharmacy to help guide this transition, You will also be contacted about your prescriptions and transitioning them to another club."
"Transforming our business means managing our real estate portfolio and Walmart needs a strong fleet of Sam's Clubs that are fit for the future," said John Furner, president and CEO of Sam's Club, in the statement. "We know this is difficult news for our associates and we are working to place as many of them as possible at nearby locations."
In the press release, Walmart said it will offer "support and resources to those associates who are affected, including the bonus announced today and 60 days of pay, as well as severance to those eligible."
It is believed that on this big day Walmart, the largest private employer in the US had a public relations mess on its hands. The sudden layoffs of employees has created quite a stir all across.
Walmart did not comment on how many people are being let go, but the total affected from these store closures are 9450.
The federal worker adjustment and retaining notification act(WARN) requires huge employers to give a 60 day notice to its employees before it closes down a plant or issues mass layoffs.
Throughout the day many cities reported the store closures without WARN notice. But Sam’s Club would be paying allowance and severance based on how long the employee had been at a store.
Hitt, the Walmart spokesperson was unfamiliar with where the store would issue WARN notices but stated the Company would have issued wherever appropriate. He declined to answer on names and places of stores which are being closed down. But he confirmed that the stores were shut for one day as of now and will again reopen on Friday to begin liquidation sales and meanwhile inform employees about the decision.
By Minu Manisha