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Publix pay fallout: Readers give their 2 cents over losing a quarter

Readers, bloggers, customers and employees weigh in on a Publix plan that cuts some pay.

By Mark Albright, Times Staff Writer
Published April 9, 2007

ADVERTISEMENT [Times photo: Keri Wiginton] Ray O'Connor, 75, stands in front of the Publix where he has been a bagger for 10 years. His pay was recently docked 25 cents an hour. Previous coverage Publix's new pay system: High performance, smaller paycheck (March 25)

Despite superior work ratings Louann McCurdy was earning the maximum $10.25 an hour cashier salary, so she wasn't always eligible for annual raises. But when her manager tried to cut her pay by a quarter an hour last week, that was too much.

She quit.

"After working at Publix 12 years I had earned every nickel of that $10.25 an hour so I'm not about to let them arbitrarily take it away," said the 48-year-old Tarpon Springs woman. "This isn't about the quarter. I have my pride. Right now I have no job, no prospects of getting one and yet I feel very relieved."

Publix Super Markets Inc. has been vague about who's shouldering most of the pay cuts from an unusual new pay plan imposed on 115,000 workers in its stores. But more than two dozen workers from Tampa Bay stores who accepted cuts to keep their jobs say most of those choices are being put to veteran Publix workers in their 50s, 60s and 70s - including an 80-year-old Palm Harbor bagger.

"They tagged five people here with pay cuts, including me," said Ed Lapinski, 55, a cashier in a Homosassa Publix. "The other four were seniors in their 70s."

In the two weeks since 75-year-old Spring Hill Publix bagger Ray O'Connor spoke out against the chain's new pay plan in a St. Petersburg Times article, there's been lots of fallout.

Letter writers peppered local media and filled a several pages of give-and-take among employees and customers on online comment boards where the story was published. Some customers said they will boycott Publix. Uncertainty spread among workers awaiting review or who had kept pay cuts to themselves.

"Even the private security guard at the front door asked me about my pay cut," said Wendy Giddings, 55, who works at a St. Petersburg store.

The discussion comes at a time when big retailers are beginning to grapple with ways to keep costs under control with an aging work force. Wal-Mart Stores Inc. was criticized when a memo surfaced last year mapping tighter work rules to prod more older workers to quit before they aged through their prime years for health claims. Circuit City Stores Inc. last month laid off 3,400 of its highest-paid sales help to replace them with lower-paid workers.

Publix, which says more than 20 percent of its store workers are 50 or older, says the pay plan is not about age or cost control. The company increased its payroll and adopted the pay system to take to the next level its renowned customer service and national recognition as an employer of choice among seniors.

"Only a small percentage of our 115,000 hourly store employees have had their pay reduced," said spokeswoman Shannon Patten. "This not about age. We're doing this for the right reasons: to reward those who perform well. A huge majority of our employees prefer it that way."

Publix's plan rewards top performers but, for the first time, can impose 25-cent-an-hour pay cuts to prod employees to do better if their evaluation scores slip. Workers get six months to improve before a pay cut.

Seventy-seven percent of Publix store employees reviewed in February got a raise while 4 percent saw a pay cut. Even top-tier scorers who got double raises of 50 cents an hour can lose them if they don't maintain their ratings.

Online reader comments characterized Publix "plantation-style management" taking small change from people living paycheck to paycheck after the company's net income soared to a record $1.1-billion in 2006.

From the other side, self-described hard workers question why veterans should get away with easing off the throttle, see no problem penalizing a small group of "bottom feeders" and say baggers don't add much value to Publix.

"It was jarring to people here because people thought Publix, which has been seen as a desirable employer, was beyond all this," said Peter Helwig, a Lakeland lawyer in Publix's corporate home town.

Blogs of retail experts read by supermarket executives debated the pros and cons of Publix' use of disincentives. Most liked the idea if store managers can rate employees on a consistent basis using objective, benchmarked criteria.

"The fact is Publix doesn't want someone who quits over a quarter an hour anyway," said David J. Livingston, president of DJL Research in Pauwaukee, Wis. "They want someone who tries harder all the time, has a great attitude and, if they lose a quarter an hour, is committed to get it back. That's what made this company a dominant force against strong competition like Wal-Mart."

Some whose pay was cut question the consistency of their ratings. A few lost attendance points for taking sick leave. One lost two points for each unexcused absence while another was docked one point for the same reason in the same store.

"It's still a good company," said Gene Sullivan, a one-time Publix store manager. "They just put too many young managers who don't know how to treat people in charge of multimillion dollar businesses."

As for O'Connor, the bagger who was first to sound off about the pay plan, he was counseled by his managers to refer customers who ask about his job situation to them. Last week they handed him a $5 gift certificate after a customer lauded him for "superb service."

"Maybe they're trying to butter me up" he joked. "But I'm not leaving here until my work record is cleared."

Mark Albright can be reached at albright@sptimes.com or (727) 893-8252.

What they're saying

"What a recipe for poor employee relations! I won't feel the same way about Publix if I shop there again."

Dorothy Snidow, St. Petersburg customer

"It was jarring to people here because people thought Publix, which has been seen as a desirable employer, was beyond all this."

Peter Helwig, a lawyer in Lakeland where Publix is headquartered

"It certainly appears that the spirit and values of the late George Jenkins are no longer with Publix."

Sarah A. Benjamin, South Pasadena customer

"If they stop improving after receiving the higher or maximum pay, they should get a pay cut."

Ta-Hung (Tony) Jenq, a Publix assistant store manager in Clearwater

"This paper needs to publish the pay of the CEO and top executives and all of their perks."

Jacqueline Paulausky, Clearwater customer

What happened

Publix Super Markets, Florida's No. 1 and the nation's sixth-largest supermarket chain, adopted a pay plan that rewards high achievers but can penalize employees who may do their job well but are not considered constantly improving. Lakeland-based Publix spent years creating its "Tie Pay To Performance" plan, aimed at rewarding more productive workers. Some Publix workers have found their pay docked despite being designated "successful" performers.

The response

A March 25 St. Petersburg Times story, left, about Publix bagger Ray O'Connor's pay cut and the supermarket's performance plan has prompted a strong and mostly critical response from readers of this newspaper and those of the Lakeland Ledger, which ran the story.

What it means

The topic touched nerves in several workplace debates, including inter-generational work conflict at the corner supermarket. Pay incentives for performance are old hat. But is it right to cut pay for low-level, part-time veterans if once-acceptable work performance supposedly slips a bit? How will retailers deal with an older work force as baby boomers age through their prime health care years?

[Last modified April 6, 2007, 20:57:13]