Walmart Stores Inc, the American retail chain, will have to adjust base salaries of employees working at its more than 1,400 stores across 21 states in America as a new minimum wage hike law is set to go into effect in January 2015.
An internal memo sent to store managers of several Walmart outlets showed that there will be a change in pay structure and the minimum premium payable over low grade jobs will be equalized for both high and low end job holders at the stores, Reuters reports.
Walmart is also set to combine its lowest three pay grades including cashiers, cart pushers and maintenance workers into one base rate.
"Essentially that wage compression at the upper level of the hourly associate is going to help absorb that cost of the wage increase at the lower level," a manager told Reuters requesting for anonymity.
Walmart is reportedly working towards ensuring that "stores in the 21 states comply with the law," Brooke Buchanan, a spokeswoman for the retail chain told the agency.
Walmart has been embroiled in a wage and employee-treatment controversy for a long time.
Employees feel overworked, disrespected and underpaid at Walmart and even though the retailer makes more than $16 billion every year, employees are averagely paid less than $25,000 a year, some authorities said. They have also accused the retailer of subduing employees who rightfully speak up for their rights.
Last year, CEO Doug McMillan told reporters that less than 6,000 employees at Walmart were paid below the national minimum wage limit of $7.25 an hour. Since then, several states have lifted the bar to $10 an hour and now, the retail chain has to make the changes.
The company said that improving health cover schemes and wages had increased operating costs by 3.5 percent in the latest quarter. Experts say it is tough to calculate the cost effect of the minimum wage-hike on Walmart's balance sheet.