Case Study: Walmart

Case Study: Walmart

With consumers worldwide buying similar products and globalization taking the world by storm, some multinational companies are experiencing unethical labor practices resulting from the way they treat their employees. A well established international brand like Wal-Mart has been severally accused of unethical labor practices leaving under the realm of criticism from the society (Rotman, Khamitov & Connors, 2018). The philosophy of Wal-Mart is to provide excellent customer service and low prices continually. Nonetheless, this philosophy has the potential of keeping consumers away.

Founded by Sam Walton, Wal-Mart is one of the biggest companies in the United States, having approximately 9000 retail stores with different names in different countries around the world. With its tremendous growth and expansion within the last six decades, Walmart has remained true Walton’s philosophy and belief of associates being responsible for making changes in the company’s consumers and business performance (Caraway, 2016). However, this philosophy has impacted its perception of being unethical towards employees and suppliers. Being a non-union organization, Walmart has an open-door policy that allows the workers to report their complaints beyond the management level. The open-door policy does less than expected in helping the employees, but it provides the company with the leverage needed to eradicate unwanted noncompliant help. The employees also start at lower salaries than the other unionized companies making most of them quit by the end of their first year. The company does the unethical acts as a way of protecting the philosophy of the company, ignoring their implications too on the employees.

Walmart has also been accused several times of its discrimination against the women. In line with the company’s philosophy and the responsibilities of the management, women have been denied continuously promotion and training opportunities offered to men. In June 2001, a group consisting of six former and current Wal-Mart’s female employees filed a lawsuit of sex discrimination against the company. The group sought to represent over 500,000 female and general Wal-Mart employees. The court filed the suit since the company failed to provide equal opportunities and employment for women. According to (Hughes, 2019 ), Wal-Mart has over 70% of women working in the company, yet only a countable number of women are employed as managers. Also, female workers are also treated without respect and dignity.

Besides focusing on customer satisfaction, Wal-Mart’s philosophy is aligned with servant leadership. With such a philosophy, the company has a strong belief that it is essential to develop influential leaders who can motivate the employees and work as better servants to the customers. Wal-Mart’s managers have a policy of working with the rest of employees, enabling them to lead as examples to the employees and put their best efforts at work (Rotman, Khamitov & Connors, 2018). With an effective communication network, the company is very responsive to the needs of consumers and encourages two-way collaboration across the company. Wal-Mart also has an open-door policy that encourages the employees to disclose their issues to human resource management. Employees can engage themselves with the managers by sharing their suggestions, concerns, and ideas concerning the organization.

In Walmart’s business environment, the role of Human Resource departments in the success of the organization relies on the company’s philosophy. The company realizes the importance of the proper management of their human capital to foster growth, development, and productivity of their activities (Rotman, Khamitov & Connors, 2018). Human Resource Management is also responsible for the company’s policies per the shared values of quality, excellence, integrity, and respect. The policies of Wal-Mart ensure that the employees produce the highest quality products for customers, and strive for excellence by working beyond expectations. Further, the company encourages employees to do what is right without supervision. Through the Human Resource, the company also seeks to respect and trust their associates and colleagues, consumers, and communities, to ensure that everyone gets only the best.

For the last few decades, Wal-Mart has been accused and criticized for being involved in unethical behaviors. The company has faced over 100 legal mandates from both the employees and the government. The main areas that have raised concerns include its public subsidies, foreign product sourcing, treatment of employees, and product suppliers. Wal-Mart has been accused of failing to compensate the employees who work for over 40 hours per week. In 2002, a jury issued an anonymous verdict which found that Wal-Mart was engaging in a pattern that made the employees work off the clock without any extra pays in 18 of its Oregon Stores (Hughes, 2019). However, Walmart challenged the verdict by having a post-trial motion which was denied by the court, and 83 employees were awarded approximately $210,700 in total damages,$208,300 in costs and, $1,718,000 in attorney fees.

Recently Walmart faced another lawsuit filed in the District of Columbia on the issue of endangering the health of its customers and fraud. According to the Center for Inquiry (CFI), the company has been deceiving the customers by making an inconsequential distinction between ineffective homeopathic treatments and essential medicine (Hughes, 2019 ). This action misrepresented the efficacy and safety of homeopathy. The fact that Wal-Mart claims to care for the welfare of the people but does the opposite shows an unethical behavior that prevails in the company. If the company does not resolve its unethical practices, then it might end up collapsing due to lack of trust from the employees as well as the consumers.

When Mr. Walton Started his first Walmart store, he had in mind that it would provide an outlet for the lower-income earners through its emphasis on high customer service. However, as the company grew in size and revenue, Walton’s ways were became long forgotten. With new CEO and executives, the company took a huge turn away from a family-friendly zone to a monopolizing company. The decisions made by the company became more business-minded than valuing the needs of the consumers. The company has been having a rough time trying to rebuild its reputation back to its original state, but skeptics have been hesitant to believe in the company. Wal-Mart has a Global Ethics and Compliance program designed to support the company’s business and maintain the company’s integrity (Caraway, 2016). The program is led by A Global Chief Ethics and Compliance Officer who is responsible for all ethical decisions made in the company. He oversees the company’s ethics and receives all the compliance issues then reports to the company’s Executive Vice President. The company still needs to overlook its ethical decision-making framework to ensure that the best decisions are made in the company.

Wal-Mart can implement better HRM strategies in compensation and recruitment of employees. The company should ensure that they recruit highly skilled and innovative employees, who will ensure creativity and improved product quality, therefore ensure a competitive advantage. Further, the company should ensure that their employees find the company’s compensation fair and satisfying, to ensure that the company does not lose employees to companies offering higher pay. For the Human Resource Management team to effectively motivate employees to meet the company’s objectives, the company has to adopt efficient management styles. Wal-Mart can use the democratic management style. This management style is meant to propel the company into more significant growth in the coming years (Rotman, Khamitov & Connors, 2018). It also entails the involvement of employees in decision making and feedback from the employees to the managers. Everyone has duties assigned to the, to be completed within a given time-frame. With this type of management at Wal-Mart, employees will feel motivated because their ideas and thoughts are considered and prevent the company from future lawsuits.

Regarding diversity, Wal-Mart can use the following ways to increase diversity. Firstly, the company should incorporate its dedication to diversity in its business and HR strategy, and keeping in mind that inclusivity and diversity is a long-term recurring theme, the company can attempt to re-invent its mission statement to accommodate diversity in virtually all its departments. Secondly, the company can create linkages, especially in its global sites of operations, with the immediate community, social structures, and institutions, and seek recommendations for various qualified candidates and dealers to work with the company. This move will reinforce the company’s image and improve its relations with the community. Finally, the company should always strive to lead from the top. By enhancing diversity across its top-tier managerial positions, the company can formulate compulsory diversity policies, and then embark on integrating diversity into its organizational culture.










Caraway, B. (2016). OUR Walmart: A case study of connective action. Information, Communication & Society19(7), 907-920.

Hughes, C. (2019). Ethical and Legal Issues in Human Resource Development (1st ed.). Cham, Switzerland: Palgrave Macmillan.

Rotman, J. D., Khamitov, M., & Connors, S. (2018). Lie, cheat, and steal: How harmful brands motivate consumers to act unethically. Journal of Consumer Psychology28(2), 353-361.


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