Retailer Costco Wholesale has announced it will hike hourly pay for most fixed-wage U.S. store workers to more than $30.
Hourly pay for top-tier employees will be increased by the company in a phased approach over the upcoming three years with the pay rising by $1 to $30.20 in the first year followed by an additional $1 each in the subsequent two years, Reuters reported, citing a memo sent to the employees.
The pay hike follows Costco’s contract talks with the Teamsters union, which represents over 18,000 Costco workers nationwide and had voted to authorize a nationwide strike for improved pay and perks. The final round of talks is ongoing to reach a new contract before the Jan. 31 deadline, Investing.com reported.
The memo, which was seen circulating on social media, apparently also indicates that entry-level workers will also get a 50-cent rise, bringing their starting wage to $20 per hour, the memo showed.
In a recent memo, CEO Ron Vachris emphasized that Costco’s wages and benefits “will continue to significantly exceed those offered by other retailers in the industry.”
Costco and Teamsters are still in talks despite the pay rise and no agreement has been reached as of now. The union has authorized a strike that could start as early as Feb. 1 on the failure of the establishment of a fair contract. The Teamsters are advocating for higher wages, enhanced benefits, and better workplace policies for employees.
Costco contended that the proposed pay increase fails to adequately reflect Costco’s financial success in recent years. If the strike proceeds, it could impact Costco stores across multiple states, including New Jersey, New York, Virginia, and Washington.
Costco is facing some serious issues beyond the possible staff strike. Nineteen Republican attorneys general are criticizing the firm and demanding that its diversity, equity, and inclusion (DEI) programs be discontinued. They argued that these actions violate earlier Supreme Court decisions and are discriminatory.
The attorneys general have asked Costco to either end its DEI programs within 30 days or give an explanation for keeping them in place. This follows Costco shareholders’ resounding rejection of a move to evaluate the risks related to the company’s DEI policies, with more than 98% of the vote going against it. The National Center for Public Policy Research, which presented the request, asserted that the corporation faces financial, reputational, and legal concerns as a result of DEI efforts.
