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April 6, 2020

Is This the Way to Give Workers a Bonus?

Filed under: Business,Food/Groceries,Retail — Edgar (aka MrConsumer) @ 5:37 am

No doubt, many people are facing personal financial hardships because they have lost their job or are working reduced hours. But many companies are stepping up continuing to pay workers or even offering extra pay.

One such company is the closeout retail chain Ocean State Job Lot (OSJL) with 139 stores throughout the Northeast. In an email to customers last week, their CEO told of hundreds of thousands of dollars of in-kind contributions of food and protective medical equipment their company has made.

He also noted a $2 an hour pay increase for workers, an additional bonus, and a more generous employee discount program.

There was one unusual disclosure in the letter, however.

*MOUSE PRINT:

OSJL- letter

The company is financing the bonus to employees by automatically tacking on a two-percent surcharge to every shopper’s bill at the checkout. While you can opt-out, how many people even realize that they are being surcharged in the first place? Many won’t see the signs nor have carefully read the email. And how awkward and embarrassing to have to say to the very person this money is intended to help that you don’t want to contribute.

While we applaud OSJL for its very generous contributions to hospitals and veterans organizations, in our view, the customer contribution for an employee bonus should be voluntary — opt-in — just like this chain does for the other causes it asks customers to support during the year.

Contrast their surcharge approach with the voluntary method being taken by the Daily Table in Boston. Their nonprofit mini-supermarkets, created by the former CEO of Trader Joe’s, buy soon-to-expire food from manufacturers and stores. They cook some of it and prepare single-portion meals for the lower-income shoppers that frequent their stores. Last week, the Daily Table sent out an urgent email plea to customers asking them to help pay their employees an emergency aid bonus of $2 an hour which was not in their budget. MrConsumer was happy to contribute.

So what do you think? Should stores be able to automatically tack on a surcharge to their customers’ bills to help finance an employee bonus, or should they simply just ask shoppers to support their employees through voluntary contributions?

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11 Comments

  1. Why didn’t the company just raise their prices by 2% across the board? That would have accomplished the same thing.

    And what is the difference between this and raising the minimum wage? Both result in higher prices being passed on to the customers.

    Comment by PC — April 6, 2020 @ 6:35 am
  2. At a guess, I’d say the 2% surcharge vs. price increase has something to do with “creative accounting” and tax implications.

    Comment by MS — April 6, 2020 @ 9:25 am
  3. Is this even lawful here?? 2% is not much, but not the way I would do things here.

    Edgar replies: Richard, our pricing law says that sellers must disclose the price at which the item is to be sold on the shelf or on the item. If every item is in fact higher priced, that might be a violation. There was a retailer somewhere a few years ago who put up signs through out the store that all items were subject to a 10% surcharge at the cashier. That way people thought they were getting a good price by seeing a lower than real price on the shelf, but were charged more. I can’t remember what happened to them.

    Comment by richard Ginn — April 6, 2020 @ 12:16 pm
  4. I think I’d rather help those who lost their jobs over those who didn’t.

    Comment by Randall Flagg — April 6, 2020 @ 1:05 pm
  5. What about all of those people who aren’t working right now and their finances are strained. They are already having problems feeding their families and paying their and now someone is asking for more money from them.

    Comment by Jerri — April 6, 2020 @ 1:46 pm
  6. My opinion, if the company wants to give a bonus, that’s their responsibility. No one is giving me a bonus, I have no job.

    Comment by JE — April 6, 2020 @ 1:52 pm
  7. I have shopped OSJL for years, and I often get asked at the register if I’d like to make a donation for “the veterans.” When I asked about where the money goes and which organizations they support, the only answer I got was “Well, it’s for the veterans.” ever did find out where the money goes, so stopped giving in their stores.

    Comment by StAugustine — April 6, 2020 @ 5:00 pm
  8. Just put out a tip jar.

    Comment by Rick — April 7, 2020 @ 7:37 am
  9. OSJL did not change the prices of items on the shelves because the consumer can technically decline the automatic surcharge and still pay those prices. This seems like a loophole that they won’t get in trouble for.

    I don’t mind paying more for items if I know that the money will actually go to workers, but I prefer that the company doesn’t do so by automatically adding a gratuity to the purchase.

    Comment by Wayne — April 7, 2020 @ 2:26 pm
  10. Can we talk into perspective? This two cents on a dollar going to low wage people who are potentially endangering themselves to help you.

    Comment by Rob — April 11, 2020 @ 12:18 pm
  11. I shop at OSJL all the time and despite not going there for weeks because I’m sheltering in place, I eventually needed something I can pretty much only get there, so I went there last week donned in the P95 respirator I had stashed away in my garage for years. At the checkout, the cashier asked me if I minded paying 2% more for the employee “bonus”. I was not expecting this question, so after I let it sink in I politely said “no” because my husband and I have no income right now and can’t afford it. So at least at my store they’re asking you at the register if you don’t mind the up charge. I don’t consider that deceptive at all. I did kind of think it was a little strange, though, since most if not all of their employees still have a job. I’d have felt better about it if the money went to those people (like me and my husband) that have no income at all right now and may not have any for a long time.

    Comment by Renée — April 23, 2020 @ 7:39 am

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