Wal-Mart is the largest retailer in the United States and its compensation programs have come under scrutiny from critics who charge that they are unfair. The Walt Disney Company is an entertainment conglomerate whose operations include theme parks. Its executive compensation has been scrutinized since the time of Michael Eisner, and that scrutiny continues to bedevil current CEO Robert Iger. This research considers both Wal-Mart's and Disney's compensation strategies in light of the Fair Labor Standards Act and prevailing wage laws.
Wal-Mart's CEO Lee Scott received total compensation worth $23.3 million in fiscal 2007; that included use of the company's corporate jet, an incentive payment of $4.3 million, salary of $1.3 million, and stock options and grants (Waters, 2007). The company was careful to note that the "incentive" payment was not a "bonus." Wal-Mart's sales force is its store employees and the retailer gained national attention when it announced that it was raising the starting pay of new workers in 2006; that was done in part to help avoid municipalities such as Chicago mandating higher starting wages for big box retailers (Gogoi, 2006b). However, the starting pay increase affected only new hires, and salary caps were placed on other hourly workers so that those who reach the top of their job classification's pay scale would not be able to receive even cost of living wage increases (Gogoi, 2006a).
Wal-Mart recently settled a class-action lawsuit in Minnesota in which workers alleged that Wal-Mart denied them breaks and had some employees work without pay ("off the clock"). Wal-Mart denied that this was company policy, and instead maintained that individual managers were making these decisions without corporate knowledge and were subject to discipline (Pepitone, 2008).
Disney's Robert Iger received compensation totaling $51.1
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