Amazon and Whole Foods Need to Be Schooled By Walmart in Handling Emergencies like Coronavirus
A few weeks ago, Whole Foods CEO John Mackey incited indignation among employees suggesting they should donate paid time off to their fellow workers who suffer prolonged periods out of work due to illness or death in their family.
It resulted in a Change.org petition for Amazon, which owns Whole Foods, to give all employees more paid time off during the coronavirus crisis. More than a quarter-million people signed on.
The company got the message and announced it would provide an additional $2 per hour to the paychecks of all U.S. Amazon and Whole Foods employees through the end of April.
Further, Amazon contributed an additional $1.6 million to its Team Member Emergency Fund to support its employees facing unforeseen financial hardships.
A Whole Foods team leader who told me the company made a “monumental mistake” at first said the company has “righted their wrong,” and are “genuinely trying to do the right thing now,” adding that the company is being extremely flexible with workers who need to change their schedules during the crisis.
Clinical and organizational psychologist Paul Warner Ph.D, vice president of customer and employee experience strategy at InMoment, says that after its first missteps, Whole Foods has gone far to restore employee confidence that will be most needed after the current disruption.
“While the initial messages sent by many executive leaders was not received as intended, Whole Foods has instituted policies that will positively impact their employees,” he says. “As these individuals feel understood and cared for and when this crisis ends, they will be ready to rejoin and put their best selves into their work.”
With goodwill restored at Whole Foods, Warner advises other companies to be mindful about how important effective communication with employees is right now.
“As the COVID-19 pandemic evolves and changes every minute, organizations must stay aware and over communicate with their workforce,” Warner advises.
Employee relations have been a sticking point for Amazon
But then, Amazon, in particular, has faced tense employee relations in the past. Most recently Amazon warehouse workers have staged several walkouts over unsafe working conditions due to inadequate COVID-19 protections offered in their workplace. This followed another walkout during July Prime Day 2019 when workers in its Minneapolis-area fulfillment center, as well as workers in Europe, went on strike to protest company working conditions and demanded more benefits and higher pay.
Despite offering $15 per hour starting pay, the company has also taken heat from the fact that many of its workers rely on the government-funded Supplemental Nutrition Assistance Program, otherwise known as food stamps, to feed themselves and families.
In 2018 The Counter, a news source devoted to the food economy, reported that in five states – Arizona, Kansas, Pennsylvania, Ohio, and Washington – Amazon ranks among the top 20 employers with its workers getting SNAP benefits.
This adds extra punch to the Change.org petition which stated: “Given that Whole Foods is owned by Amazon, one of the most valuable corporations in the world, owned by Jeff Bezos, the wealthiest person on earth, we implore Jeff Bezos to provide his employees or ‘associates’ with better working conditions and paid medical leave during this national health crisis and beyond.”
On reflection, I can’t help but wonder how Amazon’s 798,000 employees are going to feel at the end of April when the $2 hourly bonus goes away. The company does not report the number of Whole Foods workers.
Having enjoyed a bump in pay for a month or more, they may feel shorted when the old pay schedule returns. The last time Amazon raised base pay was in November 2018. It seems likely they will feel entitled to a permanent pay raise, rather than this temporary one.
The last thing that Amazon needs after this immediate crisis ends is disgruntled employees who feel under-appreciated for their hard work during and what will be expected afterward. And for Whole Foods, it is even more important to support its staff because it depends on front-line store workers to service its customers with a smile.
As an e-commerce company, Amazon’s most important customer service challenge is to deliver customers’ packages on-time. Personal customer service isn’t required as in brick-and-mortar retail like Whole Foods.
Walmart understands how to deal with emergencies
For lessons in the care and feeding of customer-facing retail employees during this crisis, Amazon can learn a lot from its chief competitor Walmart, with 1.5 million U.S. employees.
Walmart, with more than 5,000 stores across the country, has a long history in dealing effectively in natural disasters. While the national scope of the coronavirus pandemic is unprecedented, it can call upon its previous experience dealing with local emergencies to manage this national one effectively.
And Walmart recognizes that in this time of crisis, its employees are the cornerstone on which the entire business rests.
A March 19 memo to Walmart U.S. employees, John Furner, president and CEO, Walmart U.S., was filled with emotional empathy rare to see from corporate C-suites. It reads:
“It’s been incredible to see Walmart associates step up to the challenge of serving America this month. During a very uncertain and stressful time, you have done your jobs with calm, compassion, and excellence. Because of you, Americans have been able to get the items and services they need from clean, orderly, stores — or delivered right to their doorsteps.
Thank you so much for devoting yourselves to your customers and communities. I also want to say thank you to your spouses and loved ones who’ve had to take on extra responsibilities during this time — particularly with many schools and daycares closed, and relatives and friends to look out for.
We are so grateful for your hard work.”
Following this message of sincere thanks, Furner goes on to announce that all employees will receive a special bonus on April 2 — $300 for full-time hourly associates and $150 for part-time. In addition, quarterly bonuses for hourly associates will be paid a month early.
As compared with Amazon, these bonuses are just that, an extra bonus on top of their normal pay, separate and distinct from it. It is an unexpected gift of appreciation and unlikely to be confused with one’s pay.
Bundling that extra $2 into weekly paychecks as Amazon has done can lead to resentment when it is taken away. There is no such danger with Walmart’s bonus.
In the memo, Furner went on to say, “We know this is a difficult time when many people could use more cash, and we want to support you how we can,” then continued that on Friday March 20, all associates will have their 10% employee discount extended to grocery items.
And he ended with the announcement that the company planned on hiring an additional 150,000 workers “to help support you as you deal with the current level of demand.”
This stands in stark contrast to Amazon’s announced plans to add 100,000 workers. “We are opening 100,000 new full and part-time positions across the U.S. in our fulfillment centers and delivery network to meet the surge in demand from people relying on Amazon’s service during this stressful time, particularly those most vulnerable to being out in public,” Amazon said in a statement.
For Amazon, the added workers are positioned to help the company, whereas Walmart’s new employees will help its already stressed-staffers meet their extra workload.
Start with empathy
In Walmart’s response, as compared with Amazon’s, the company is showing a high level of emotional intelligence that Dr. Warner says is needed most now.
That emotional intelligence is shown again in another message from Doug McMillon yesterday: “Walmart associates have gone above and beyond the call of duty in serving our customers during these unprecedented times. We want to reward our associates for their hard work and recognize them for the work that is in front of us.”
Dr. Warner says the best advice for any company in this or any other crisis that impacts its workers is to communicate often and consistently, starting with empathy, continuing with empathy and ending with empathy, just like Walmart’s Furner and McMillon have done and, I have no doubt, will continue to do so.