Costco to Raise Hourly Wages to Over $30 for Most Workers: Report

Costco to Raise Hourly Wages to Over $30 for Most Workers: Report

Wholesale giant Costco has announced it will raise hourly wages for most of its store employees to over $30. According to a memo obtained by Reuters, the pay increase will affect the company’s top-tier workers, with an initial $1 raise to $30.20 per hour in the first year, followed by an additional $1 increase in each of the next two years.

The memo emphasized that these changes will keep Costco’s wages and benefits ahead of most of its retail competitors, stating, "With these changes, we believe our hourly wages and benefits will continue to far outpace others in the retail industry."

In addition, employees at the lower end of the pay scale will receive a 50-cent raise, bringing their hourly wage to $20.

Costco, which ranks as the world’s third-largest retailer by revenue, behind only Walmart and Amazon, according to Deloitte, has made headlines for its wage adjustments as it faces labor pressure.

Pay Increase Amid Potential Strike

This wage increase comes as Costco workers represented by the Teamsters voted to authorize a nationwide strike. The union, which represents more than 18,000 Costco employees, is in the midst of final contract negotiations ahead of a Friday deadline.

The Teamsters have expressed frustration over what they see as the company's failure to negotiate fairly. A social media post from the union stated, “The vote is a direct result of the company’s continued failure to bargain constructively and refusal to present a fair contract offer that reflects the company’s record-breaking profits.”

With 85% of the union members voting in favor of the strike, Teamsters spokesperson Matthew McQuaid suggested that Costco’s wage increase is a response to the union’s pressure, saying, “Don’t be fooled by Costco’s fake generosity. This is not a worker-friendly company—it’s a company that’s terrified of worker power.”

The strike is set to begin on February 1 unless an agreement is reached before the January 31 deadline.

Costco's Recent Controversies

In addition to the wage hike, Costco recently made headlines for voting down an investor proposal that called for an investigation into the risks of the company’s diversity initiatives. Shareholders overwhelmingly rejected the proposal, with more than 98% voting against it.

Costco chairman Hamilton “Tony” James defended the company’s diversity, equity, and inclusion policies, stating, “We owe our success to the more than 300,000 employees who serve our members every day. It is important that they all feel included and appreciated and that they transmit these values to our customers.”

James and other board members had urged shareholders to reject the proposal, underscoring their commitment to fostering an inclusive workplace culture ahead of Costco’s annual meeting.

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