Walmart announces raise increases, expanded benefits for full-time workers

Walmart giving employees $1000 bonuses, raising minimum wage

In addition, Walmart is raising its starting hourly wage to $11.

The world's largest private employer made it clear on Thursday it's still in the "early process" of looking at the new tax bill, which slashes corporate tax rates to 21 percent, and would provide more details on future investments next month.

Walmart's CEO Doug McMillon in a statement that the combined wage and benefit changes, which will benefit more than 1 million United States hourly associates, are a result of tax savings from this year's tax reform that reduced the country's corporate tax rate to 21%. Wal-Mart also said it will spend another $400 million in the current year ending January 31 on one-time bonuses ranging from $200 to $1,000 based on length of service.

(Not long after it announced the wage increase, reports emerged that it was closing dozens of Sam's Club stores.) As for parental leave, it is increasingly becoming the law of the land, too, with NY and California requiring companies to offer expanded paid maternity and paternity leave. On Thursday, Walmart promised to boost its minimum pay to $11 per hour along with an expanded maternity and parental leave benefits.

The adoption benefit, available to both full-time hourly and salaried associates, will come $5,000 per child and may be used for such expenses as adoption agency fees, translation fees and legal or court costs.

American hasn't been paying federal income taxes because of substantial losses in the past, but CEO Doug Parker said in a letter to team members that the tax package will give the company a boost down the road. The company's revenue for the quarter was up 4.2% on a year-over-year basis. sell-side analysts forecast that Wal-Mart Stores, Inc. will post 4.43 earnings per share for the current year.

The minimum wage increase takes effect next month and represents an incremental increase of $300 million to the company's plan for the next fiscal year. Along with Walmart, those bonuses make up just 0.13 percent of the tax cuts' value to corporations over the next 10 years. The one-time bonus is an additional payment to associates of about $400 million in the current fiscal year, which ends January 31.

"Walmart really started to turn a corner a couple of years ago when it started to simultaneously invest in stores, logistics, e-commerce and employee wages", Perkins told CNBC. "The worry was that Wal-Mart, facing the same kind of wage pressures as Target amid 4.2% unemployment, would have to embark on a new round of pay increases". Among other things, economists blame the lack of bargaining power for lower-skill employees, such as retail workers, and the tendency for companies to reward executives and shareholders, rather than workers, when they're flush with cash. In 2016, it said employees who finished an in-house training programme would be eligible for $10 an hour. Costco's starting wage is at least $13 an hour while Target is gradually its starting hourly wage to $15 by 2020.

The retail company said the wage hike to $11 an hour would roll out in February. The one-time bonus payment increases planned spending by an additional $400 million.

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