Wal-Mart – Target of Health Insurance Legislation

Wal-Mart Stores Inc., the nation’s and world’s largest retailer, is quickly becoming Florida’s largest retailer. The chain opened 50 of its 24-hour Supercenters throughout the state during 2002 and 2003, and there are nine Wal-Mart stores in Pinellas County- two Sam’s Clubs, three Supercenters and four regular Wal-Marts.

It is also among the state’s largest private employers, with 77,850 employees-far more than the 54,000 employed at Walt Disney World. According to Wal-Mart’s media relations cbdweeds.co.uk, there are 3,407 people employed Wal-Mart in Pinellas County.

With these large employee rosters come high costs. Wages, overtime, benefits, taxes and other expenses make staffing and its related costs the biggest expense for almost all employers. When a company is big enough to employ tens of thousands of people, methods for cutting costs are an issue management visits daily.

Often management reduces employee benefits-namely health insurance-as a way to keep costs down, and until recently this practice was met with little resistance. But this month legislative action in both Maryland and Pennsylvania took exception to this practice. And lawmakers in 28 other states, including Florida, Connecticut, Kansas, Colorado and Tennessee, are preparing to introduce similar legislation. The face of cost savings at the biggest employers-and specifically Wal-Mart-may never be the same.

On Jan. 12 the Maryland Senate voted to override a governor veto of a bill requiring companies with more than 10,000 employees to pay for some health-care benefits. Dubbed the “Wal-Mart Bill,” the legislation is aimed squarely at the retail giant. It is already having a negative effect, as Wal-Mart’s shares had their biggest decline in a month, closing lower 83 cents, soon after the vote.