Dollar General and Dollar Tree called for improvements in job security and wages

Dollar General and Dollar Tree stores

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Two activist investment firms call dollar general And money tree Shareholders are expected to approve two resolutions aimed at improving job safety and wages, the companies said on Tuesday.

Dollar General Proposal 7, led by Domini Impact Investments, calls for an independent audit of worker safety and well-being. This will be voted on at the company’s annual general meeting on May 31st.

Dollar Tree Proposal 7, led by United Church Funds, calls for a report on wages and inequality to be produced. It will be presented to shareholders during the retailer’s annual general meeting on June 13.

The resolutions aim to address long-standing workplace safety and wage concerns that plague workers at growing discount chains, which are expanding their stores faster than any other retailer. Combined, they employ more than 377,000 people nationwide, company records show.

Dollar General is currently facing fines of more than $16 million from the federal Occupational Safety and Health Administration for safety hazards, including blocked fire exits, blocked electrical outlets, and dangerous clutter.

“It’s way too dangerous in the stores that we work in,” said David Williams, a storekeeper at Dollar General, during a panel discussion on Tuesday. “It’s an urgent need and there’s no point in always looking behind your back and always trying to do your job, but at the same time always trying to make sure you’re safe too.”

Federal regulators have repeatedly found similar violations at Dollar General stores across the country, leading OSHA to classify the company as a “serious violation” of workplace safety regulations. It’s an award considered “unprecedented” and “rare” for a company of its size and stature, said Debbie Berkowitz, a former OSHA chief of staff and senior policy adviser.

“[It’s] a program for the worst security breaches in the country. It is extremely rare for a large employer with many jobs to participate in the Serious Violations Program. Most of the companies in their program are small construction companies,” said Berkowitz, who is also a fellow of the Kalmanovitz Initiative at Georgetown University.

“OSHA rarely finds the same hazards or indicts the same company so many times for the same violation. Typically, companies try to fix safety issues that put workers at risk,” she said.

Berkowitz pointed out that OSHA fines are notoriously low. Given Dollar General’s fiscal 2022 revenue of $37.84 billion, the penalties shouldn’t have a major impact on the company’s balance sheet.

The retailer did not respond to a request for comment. It is currently in settlement negotiations with OSHA. The board has called on shareholders to vote “against” Domini’s resolution, voting records indicate.

A shopper walks past a $1.25 price tag posted on the shelves of a Dollar Tree store in Alhambra, California, December 10, 2021. The store is known for its $1 items, but inflation has pushed prices up to $1.25.

FREDERIC J. BROWN | AFP | Getty Images

Dollar General previously told CNBC it was “regularly reviewed.”[s] and refine[s] our safety programs and strengthen[s] them through training, continuous communication, recognition and accountability.”

“When we learn of situations where we have not lived up to this commitment, we work to address the issue in a timely manner and ensure that the company’s security expectations are clearly communicated, understood and implemented,” a spokesman said.

Kenny, a Dollar Tree employee, said he is only allowed to work 15 hours a week and makes about $600 a month. The low wages and inability to work full-time caused him to lose his apartment and move in with his parents.

“You can’t expect most working adults, even teenagers, to make that little money because that, by and large, isn’t going to help,” said Kenny, who didn’t reveal his last name.

Matthew Illian, director of responsible investing at United Church Funds, said Dollar Tree, unlike some of its competitors, does not have a minimum wage requirement.

Costco, Goal, best buy, AmazonIKEA and Starbucks All have a guaranteed wage of at least $15 an hour Walmart has committed to $14 an hour. However, dollar stores generally differ from many of these retailers due to their heavy presence in rural communities that tend to have a lower cost of living.

Still, in many of these locations, the Dollar Store is one of the few retailers in town, so there is less competitive pressure to improve wages, safety, and even the quality of merchandise.

Illian argued that investors benefited from income equality – citing a study by the Economic Policy Institute that found income inequality hurts GDP by 2% to 4% a year.

“The economy would be doing better overall. That means more people have more money in their pockets and are spending that money in more places,” Illian said. “As such, we are asking Dollar Tree to consider how their compensation practices impact a diversified investor’s returns.”

Dollar Tree declined to comment. Its board has urged shareholders to vote “against” the United Church Fund’s resolution, voting records show.

– Additional coverage by CNBC’s Melissa Repko Dollar General and Dollar Tree called for improvements in job security and wages

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