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Hazard Pay Practices Halted For Several Large Companies In Ohio

Grocery stores such as Kroger around the United States are using signage, plexiglass barriers and other measures to prevent the spread of the coronavirus disease COVID-19.
Kroger
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Grocery stores such as Kroger around the United States are using signage, plexiglass barriers and other measures to prevent the spread of the coronavirus disease COVID-19.

Early in the pandemic, as Ohio forced a lot of businesses to close, many that stayed open offered their workers hazard pay. As part of our Curious Cbus project, where we investigative listener and reader questions, one person asked us if any businesses were still offering hazard pay.

Retailers like Kroger, Amazon and Walmart all partook in hazard pay in the early days of the pandemic last spring. This practice ended in 2020 for all three companies, although they’re still giving out some bonuses.

Kroger raised wages in the first few months of the pandemic. The raise amounted to $2-per-hour. Kroger Corporate Affairs Manager Amy McCormick says the company is finding ways to financially thank employees outside of hazard pay.

“We did provide additional pay early in the pandemic. That ended in mid-May. We have continued to apply recognition and bonuses to our associates through store credit,” McCormick says. “I think three or four weeks ago, we just did another $100 store credit to our associates, along with fuel points.”

Amazon gave its employees a $2-per-hour hazard pay raise through April 2020. Amazon associates also received thank-you bonuses in June and November of last year. That amounted to $500 for full-time employees and $250 for part-time workers.

Walmart has done four rounds of special cash bonuses nationwide. These amounted to $300 for full-time employees and $150 for part-time workers. Walmart employs 47,000 Ohioans.

Why did these companies stop hazard pay when some employees are still at-risk for getting COVID-19?

Hazard pay is a major economic burden on employers, according to Ohio State economics professor emeritus Lucia Dunn.

“Now of course the economic consequences of this is it becomes very expensive for an employer. There was a lot of pushback,” Dunn says. “At one point Kroger stopped the hazard pay, and that was in the news a lot.”

The grocer gained national attention after deciding to close some locations outside the state, for example in California, over government hazard pay laws. In a press release, the company said grocery stores receive “razor-thin” profit margins, and that the additional hazard pay requirement would make it impossible to run a financially sustainable business.

Dunn says hazard pay for essential workers, like those in grocery stores, was crucial for getting people through the pandemic.

“I think a lot of companies did the responsible thing. They were good citizens, they realized this was something, just a sacrifice they were gonna have to make,” Dunn says. “That they’d have to do it to get our society through the pandemic.”

Along those lines, Kroger has invested $1.5 billion on worker pay and safety measures in stores during the pandemic.

Like Kroger, Amazon and Walmart insist they care deeply about worker safety. Amazon provided a list of process changes they’ve made to bolster their employees’ health and safety. Some of these changes include expanding janitorial staff, building out testing labs to conduct COVID-19 tests on-site and adding on more hand-washing stations on-site.

Overall, Walmart paid more than $2.8 billion in quarterly and special pandemic bonuses nationwide.

All three kept the focus on investment in safety measures for employees.

Where do things go from here economically?

Kroger is currently offering a one-time payment of $100 to all associates who receive the full manufacturer-recommended doses of the COVID-19 vaccine.

Indications points to hazard pay as an hourly bonus being mostly a thing of the past. As the access to vaccinations nationwide increases, COVID-19 infection rates have decreased, but there are still risks for workers.