There’s been plenty written over the years about poor wages and working conditions in Asian countries, such as China, that produce cheap consumer products for American retailers like Walmart.
But some questionable labor conditions exist right here at home, where those imported goods are funneled into the domestic supply chain. Labor groups and regulators point in particular to problems faced by temporary workers who staff huge warehouses that line freeways and rail yards outside Los Angeles and Chicago.
Southern California’s Inland Empire -- a vast desert region east of Los Angeles -- is home to the largest number of warehousing facilities in the country, including several that move goods for Walmart. The area’s boom as a national logistics hub over the past several decades has been facilitated by cheap land for development; access to freeways and rail lines, along with extensive public-private investment in transportation infrastructure; massive imports from Asia that need to get to distribution centers and big-box stores inland; and a base of low-skilled blue-collar workers available to do the warehousing and truck-driving work required.
Walmart's warehouse No. 6909 is located in Mira Loma, Calif., about 50 miles east of the Ports of Los Angeles and Long Beach. A steady stream of Walmart and Sam’s Club trucks roll past on their way to the loading docks inside.
Javier Rodriguez is a temporary worker at the warehouse. He’s worked there for more than a year. Looking past the guard house at the gate, he describes operations inside: “What’s arriving is merchandise for different Walmart destinations,” he says, “and our job here is to sort it and send it in trailers all over the United States.”
The warehouse moves a wide range of consumer goods: everything from toys and baby furniture, to exercise equipment, linens and electronics.
The facility is what’s called a cross-dock. Goods -- mostly imported from Asia -- come in from vendors like Mattel. Workers run them across the loading dock, then reload them right away into Walmart trucks.
Javier Rodriguez makes $10 an hour as a forklift driver. He has four children and a wife at home, so once his shift is over in the late afternoon, he goes to a second warehouse job to make more money to support his family.
Victor Caudillo works in the same warehouse as Rodriguez. He lives in a rundown apartment in nearby San Bernardino, Calif., with his wife, two children, a brother and cousin.
Caudillo is what’s called a ‘lumper’ -- he loads Walmart boxes by hand. That’s an $8 an hour job, but he says he rarely gets 40 hours. “I get 32, 34 hours a week, taking home probably $190-$220 max.”
Caudillo’s been at the warehouse for one year, and like Rodriguez, he’s classified as a temporary worker. So he doesn’t get paid sick time, vacation, health or retirement benefits. Plus, he says, the work is grueling -- and not very safe.
“Our ramps -- your wheels will get caught and all your freight falls,” he says. “Our carts, sometimes the wheels don’t even work, with that extra thousand pounds on it -- impossible to pull. Our water, sometimes we don’t even have water.”
The employment structure at the warehouse where Caudillo and Rodriguez work is complex. The facility moves goods exclusively for Walmart. But it isn’t owned or operated by the giant retailer. Instead, Walmart contracts with a New Jersey-based company called NFI to run the warehouse. NFI in turn contracts with temporary-staffing agencies to hire and supervise the workers -- several hundred of them.
“The [staffing] agency is Warestaff," Javier Rodriguez explains. "But Warestaff works for NFI, and NFI works for Walmart.”
Rodriguez, Caudillo and other workers are organizing for better wages and conditions, with help from the union coalition Change to Win, which includes the Teamsters, United Food and Commercial Workers, Service Employees International Union, and the Farm Workers. The warehouse workers’ local group in Southern California -- called Warehouse Workers United -- has staged strikes, and charges that workers have been fired or had their hours cut in retaliation.
NFI spokeswoman Kathleen Hessert responds that the charges are fabrications to support the group’s union effort. “Absolutely NFI says there has been no retaliation,” Hessert says. “Whether something has been damaged or not, obviously when you’re moving a lot of product, there is going to be equipment that is damaged. Lack of water? Totally false.”
Hessert confirms that 90 percent of the workers in the NFI Mira Loma warehouse are temps.
And the dramatic rise in ‘permanent-temp’ workers across the warehousing industry, specifically in California’s Inland Empire, is seen as a problem by regulators who monitor the industry. They say these ‘perma-temps’ are shuffled between staffing agencies that sometimes underpay them or don’t provide proper equipment. If the workers complain, they’re easily replaced.
“Many of the workers my office has interviewed are characterized as ‘temp workers’ but they have been working for four, six, eight years for the same warehouse,” says California Labor Commissioner Julie Su. Last year, her department issued more than $1 million in fines for wage theft and other violations against staffing agencies on contract to provide workers at another Walmart warehouse in Mira Loma. That warehouse is operated by Schneider Logistics of Wisconsin.
“The use of this kind of subcontracting is meant certainly to cut costs, but also to make it more challenging to enforce the law in those workplaces,” says Su. “And it creates a very unstable, contingent workforce that is very vulnerable to abuse.”
Warehouse labor groups from Southern California and Chicago traveled to Walmart’s home office in Bentonville, Ark., last month. They were there to protest over wages and working conditions at a nationwide stakeholders meeting Walmart hosts in town, and to deliver a box of petitions signed by supporters. The workers got a meeting with company executives -- their first ever.
Walmart V.P. of Communications David Tovar provided this prepared statement to Marketplace after the meeting: “Recently, some workers at third-party warehouses we use to move merchandise have raised some concerns about their work environment. And even though these workers aren’t employed by Walmart directly, we’re taking these allegations very seriously. The fact is, we hold all of our service providers to high standards, and remain committed to ensuring that workers throughout our supply chain are treated with dignity and respect.”
Walmart says it is inspecting and auditing these third-party warehouses, and hopes to continue its dialogue with the workers' groups.
Back in Southern California, temporary warehouse worker Victor Caudillo says he’d welcome more dignity and respect from the companies up the supply chain, including Walmart. His wife, Mary, would welcome a higher paycheck, along with full-time hours and benefits.
“We get help from family, and that’s good, but they have bills to pay, too. During the end of the month it gets crazy with food -- we’re on the last bits, we eat Top Ramens or cereals. It gets hard.”
At this point in the interview, two-and-a-half-year-old Ayleen climbs up on her mother’s lap and has the last word. “Want to go to Walmart,” she says. Mary explains: “She’s been asking her dad to take her to Walmart to buy a Buzz Lightyear toy.”
At a local Walmart, a Buzz Lightyear toy will set them back $14.97. That’s almost two hours’ work for Victor Caudillo, moving boxes for Walmart.
Tomorrow, we’ll look at whether ‘permatemping’ in the warehouses is designed to keep costs low at Walmart and other big-box retailers. Read the story here.