Target store workers are struggling to keep their health insurance and pay their bills after the company vowed to raise its minimum wage to $15 by 2020.
That is the conclusion of a new report by CNN Business, which interviewed 23 current and former Target employees, including department managers. Employees say that while hourly wages have increased, work hours have been significantly cut, hurting them financially.
“I got that dollar raise, but I’m getting $200 less in my paycheck,” said a Target employee identified as Heather, who works at a Florida branch. When she started the job in November she was working 40 hours per week, but she is now offered less than 20. “I have no idea how I’m going to pay rent or buy food,” she said.
For others, schedule reductions below 30 hours per week mean they will be ineligible to receive health insurance benefits at the start of Target’s spring enrollment period.
“Target worked me hard from mid-July of 2018 to February 2019, right before my medical coverage was about to kick in,” said former employee Caren Morales from California, who worked 35 to 40 hours per week. In February she received a letter from the company about how to sign up for health insurance benefits – and then her hours were immediately cut. After begging for hours and seeing them plummet to as little as 15 per week, she finally quit in May.
“I called in on May 1 and said ‘I can’t come in today or ever again because I can’t afford my daughter’s daycare,’” Morales said. “‘You guys cut me really bad.’”
A Target representative said existing staffers are working approximately the same number of hours as they were last year and the year prior. Target added that the mix of full-time and part-time workers has also remained consistent over the past couple of years, with the percentage of hourly workers eligible for health insurance remaining steady as well. The company declined to provide numbers that support those claims, however.
Some Target employees say they have been given a variety of reasons why their hours have been reduced, while others say they never received an explanation from supervisors. And then there are those who see the company’s recent overhaul of 1,850 stores as the true problem.
“We knew we couldn’t operate the stores anymore in the same fashion we had for the last 20, 30 years,” Target COO John Mulligan said. “We needed to change the way we operate in the store to create a better, more inviting experience for our guests.”
The changes include elimination of some backroom shifts and the introduction of self-checkout machines, along with specialization of some jobs to cover a specific department instead of an entire store.
“Older cashiers were used to getting 30-some hours and they were getting less and less,” one former store manager said. “They really cut those hours back from them with the introduction of self-checkout.”
Critics of raising the minimum wage have long warned that increased investment in automation would be the result of higher staff costs.
Whatever the reason for the decline in work hours, one thing that cannot be denied is that this decline is happening at retail stores all over the country.
Current data from the Bureau of Labor Statistics shows an average 1.5-hour decline in weekly work hours compared to August of 2018. Almost a third of America’s retail workers worked fewer than 35 hours a week this year.