Publix steps on itself

Publix's new pay system: High performance, smaller paycheck
Even good employees can face pay cuts in a new pay plan at Publix that includes penalties as well as rewards.
By Mark Albright, Times Staff Writer
Published March 25, 2007


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[Times photo: Keri Wiginton]
Ray O'Connor, 75, stands in front of the Publix where he has been a bagger for 10 years. His pay was recently docked 25 cents an hour.
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After bagging groceries at Publix for nine years, Ray O'Connor was stunned when his bosses called his work "successful" then cut his pay a quarter to $8 an hour.

"I think they just want to get rid of me," said the 75-year-old Spring Hill man who works part-time to supplement his police officer pension. "They said I wasn't improving. Improve what? I've never dealt with anything like this in my life."

Now he has trouble sleeping. He's embarrassed when peers talk about pay. Nobody mentioned it, but he wonders if it's his age. He's talking of seeing a lawyer, but not quitting "until I get this blemish off my record."

O'Connor is among the first intended consequences of a new pay plan adopted by the nation's sixth largest supermarket chain. Lakeland-based Publix Super Markets Inc. spent years creating a "Tie Pay To Performance" plan that offers penalties as well as rewards.

Mass merchants have used performance incentives for years, but they're usually tied to a store's performance and meant to foster teamwork. Publix zeroes in on each worker and adds the unconventional twist of institutionalizing disincentives - even for top performers.

"We want a customer experience the customer deserves and expects at Publix, so we are rewarding people for hard work while increasing what we pay overall," said Shannon Patten, spokeswoman for the grocer that employs 142,000 people full- and part-time in five states. "But some associates face a decrease if their performance slips."

Here's how it works. Top performers - many of whom pocketed raises two to three times and up to $1 an hour more than what they were used to getting - love it. Others are getting their standard raises. Many must resolve to work harder. In February, 19 percent of employees up for review got no raise and 4 percent took pay cuts.

Publix says the plan is working. In August, 68 percent of hourly workers got a raise. The rest were put on six-month notice they had to shape up. Six months later in February, 77 percent got reviews good enough for raises, showing more workers got the message.

It's a culture shock at a chain already named one of the nation's 100 best employers, that consistently rates tops in Consumer Reports customer service ratings, and was just named the best of 19 major retail chains rated by the University of Michigan Customer Satisfaction Index.

For years, virtually all Publix store workers could count on a modest annual raise. Not now. Semi-annual evaluations, based on supervisors' numerical ratings in 21 areas, grade workers as role model, superior, successful or two types of needs-work-to-keep-the-job. The rating is matched to a performance pay range for each job. Publix gives workers a six-month warning to improve their performance to keep their current pay rate. That goes for top-rated "role models," too.

O'Connor, for instance, was rated "successful" the past two years with all his scores above average. Yet his seniority already put him at the top of the bagger pay range. So his pay was cut.

"Before this I was rated successful at 107 points and got a raise," he recalled. "Then I got a 123 and a 114 my past two evaluations and lost money." In August his supervisor wrote he needed to offer cart carry-out to more shoppers. In February he suggested O'Connor stay busier in slow times and coach younger baggers.

Publix declines to talk specifically about O'Connor's case. But the company - which employs 4,500 people over 70, 750 over 80 and two over 90 - says it's not about age. Internal reviews of those hit with pay cuts found all age groups.

Without a union contract, no federal or Florida law stops an employer from cutting pay. "But I've never heard of a plan that docks pay," said David Szymanski, chairman of the retail studies program at Texas A&M. "If you want to get rid of somebody for performance, just counsel them out."

Studies find retail employees want plans that reward performance and prod slackers to shape up. But inflation makes being passed over for a raise a pay cut. And some experts question taking money away from low level part-timers because it's divisive and undermines teamwork.

"I've never seen a pay-for-performance plan that works because it brings the top-performing lions out to feed on everybody else," said Terri Kabachnick, a Largo retail HR consultant and author of I Quit but I Forgot to Tell You. "It's worse in supermarkets where people don't control outcomes. Their day is go here, go there, clean up this spill. If you don't get along with the manager, forget it."

Is it wise to use money as an disincentive? "Cold hard cash leaves employees feeling ... well, cold," Kabachnick said.

It's a trend that began when department stores saw pay-for-performance as a cheaper alternative to commissioned sales jobs.

"In supermarkets, however, store managers often are not as sophisticated in HR practices," said Bart Weitz, chairman of the retailing program at the University of Florida.

It's not about the money to O'Connor. He has health insurance and works fewer than 25 hours a week. So with the pay cut he's only out $3 to $5 a week. "It's the principle," he said. "It's time somebody tells these big companies to stop stepping on the little guy."

Mark Albright can be reached at albright@sptimes.com or 727893-8252.

[Last modified March 23, 2007, 21:56:06]



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Comments on this article by Mike 03/27/07 11:16 AM
Bagging groceries only brings so much value to a company. What I can't believe is that we are paying baggers so much for such a menial task. For the rest of you complaining about management, you can remain the victim or take charge of your life
by doug 03/27/07 10:44 AM
What hair-brained MBA thought this new pay/performance system up. You can say 20 plus years of positive image down the drains.
by john 03/27/07 10:40 AM
Publix is getting worse. I used to shop at the Publix in downtown St. Pete. Try to find a manager around 6:00 pm when it's busy and all the lanes are full. I'll spend my money elsewhere.
by Dylan 03/27/07 08:58 AM
With everything so expensive how can you make a living working at publix. Find another job!
by Marie 03/27/07 08:28 AM
Way to go. Take away pennies from the people who live paycheck to paycheck. DON'T SHOP AT PUBLIX!!
by Tracy 03/27/07 07:53 AM
Has anyone ever had to deal with publix management? They need a drop in pay more than anyone else. Publix Corp should be assessing the management who runs their stores, not the man who is working hard to make ends meet. They should be ashamed.
by JT 03/27/07 07:52 AM
I use to work at Publix many years ago, its the same where I work today (US Airways). The Fat cat get fatter, and the price a loaf a bread keeps going through the roof for all of us...
by Paul 03/27/07 07:14 AM
Lets see, he bagged for them for nine years? I think he deserves a raise just for that! He received appreciation awards for treatment of customers...yet he doesn't do carry out as much as he should? He doesn't train younger baggers for $8 an hour??
by Mr. David 03/27/07 05:44 AM
Looks like Publix' "Plantation Style" management has finally been outed. It may be a pleasure to shop there (if you like high prices), but from what I've heard and rread, it's not the greatest place to work...Unless you're in management.
by Marty 03/26/07 11:54 PM
They just took a quarter away ....No notice. No Evaluation.
by Greeneyez 03/26/07 11:46 PM
What is so far fetched is that proformance evaluations are ultimently up to one personour dept. mangager. If they feel threated or intimidated in any way by you...they can set you up for sabotage. IT SUCKS! PUBLIX HAS NO CLUE!
by bobby 03/26/07 11:45 PM
I have actually worked with Ray, its not an age thing, its a not doing your job thing. Why should he make more than I if I'm working my butt off trying to progress with the company and he just stands around and watches me bag orders?
by just me 03/26/07 11:26 PM
Working at Publix, it seems this plan is for only certain people. This company is full of clicks, relatives, so if you are related...you have "NO" worries for getting pay cuts. Just ask around.
by VAL 03/26/07 10:52 PM
ISSUES PLEASE TRY TO KEEP THEM AT HOME. SUCH AS A DEATH IN THE FAMILY PLEASE TRY TO KEEP YOUR HEAD UP NOT THINK ABOUT IT TO MUCH WORK WORK WORK, THEY SAY THERE SORRY TO HEAR ABOUT SOMETHING LIKE THAT BUT THEY WANT U 2 WORK CRAZY AND CUSTOMER SER. A
by VAL 03/26/07 10:51 PM
PUBLIX IS A VERY GOOD COMPANY TO WORK FOR BUT THERE MAIN FOCUS IS ALWAYS CUSTOMER SERVICE,WHERE I THINK THEY ARE UNFAIR IS YOUR WORK HARD BST YOUR TAIL EVERYDAY. THE BIG THING TO THEM IS U BETTER B HERE ON TIME, NOT SICK TO MUCH ,IF U HAVE FAMILY
by val 03/26/07 10:48 PM
I DISAGREE WITH THIS PAYCUT JUNK, I BEEN WITH THE COMPANY SINCE I WAS 17 NOW IM 28 , SOMEONE AT MY JOB JUST GOT CUT.25 THEY SAID HE DONT TALK 2 CUSTOMER'S MUCH BT THE MANAGER'S DON'T SEE U 24-7 SAY HOW WOULD THEY KNOW. IT'S WRONG AND NOT RIGHT!!!!!!
by LJ 03/26/07 10:37 PM
4% of workers got a pay decrease...according to the title of this article, those are high performers. Reality is that they are the bottom 4% of performers. Looks like most of the comments here are by bottom feeders, too. Misery loves company!
by Lynn 03/26/07 09:57 PM
I would much rather have an older retired person bagging my groceries or at the cash register than these 16-17 year old high school students who just talk to each other while I stand there waiting in line. The older people are more genuine!
by Carolyn 03/26/07 09:53 PM
Publix charges the highest prices but sounds like the cheapest place to work for. A ten year dedicated employee getting a cut in pay? Think Publix just knows can replace with a 15 y/o kid who only expects min wage. Will avoid my once favorite store!
by DMC 03/26/07 09:45 PM
My mom has worked for Publix since the mid-1980s Her most recent review resulted in a pay cut also. She told me the major reason she still works there is the health insurance benefit, which isn't all that great.
by Victoria 03/26/07 08:57 PM
I have always met kind, considerate employees at Publix (VS other stores..) and am appalled at the way they are treating their employees. If someone doesnt do a good job, then fire them. This makes it too easy to cut back on payroll. Lawsuit!!
by Jane 03/26/07 08:30 PM
I'm up for a eval in a few weeks, I'm holding my breath. My mgr & I have a so/so relationship. I work my tail off, always asking for the oppty. to learn more. Much to my dismay, my mgr blows it off. So successful, not superior is b/c I'm at his mercy
by Brian 03/26/07 06:37 PM
I'd bet real money the members of what has been labeled "the greatest generation" are far more conscientious of their work ethic than the corporate "supervisors" that implement that plan. Publix is just using the little guy as an excuse. No, I'm 44.
by Candy 03/26/07 04:56 PM
re:comments by Brenda-Only F/T employees get benefits right away. P/T wait 1 yr or 1000 continued hours worked-no sick time,no pd holidays, no vacation time. I just started working for them & already found it's NOT the ideal company to work for.
by Jim 03/26/07 04:44 PM
They've been cutting truck drivers pay for years. Cutting the pay on their runs then making them work longer hours to make up for it. Ask a driver the last time they got any kind of raise.
by Bruce 03/26/07 04:34 PM
Reviews are correctly known as "merit reviews" in HR circles. People are not entitled to raises; their performance must merit it. If O'Connor was not performing up to the high standards to earn the high (for baggers)pay,why should he receive it?
by al 03/26/07 03:48 PM
Not sure were you people live. But florida is a right to work state. If they want to fire people, they can simply fire them. So work harder, find a differnet job. At 8 dollars an hour, can find other work.
by Josh 03/26/07 03:07 PM
Discriminating against the older folks seems like the opposite of what they should be doing. All the teenaged/young employees at my local Publix are horribly rude and couldn't bag gorceries if their life depended on it.
by Ellen 03/26/07 02:41 PM
Boycott Publix.
by Tony 03/26/07 02:35 PM
I want to know how many corporate people received pay cuts if any for lack of performance. What a cheap outfit. Don't cut the pay of the people who do all the work, cut the pay of the stupid mnager who hired them and failed to properly train.
by Sue 03/26/07 01:33 PM
I hope store managers read this: HEADS UP! Tell your cashiers/baggers to STOP CHEWING GUM in the faces of your patrons. They look and sound like cows. Watch what happens after groceries are bagged - if they don't hand them to the customer...bye-bye!
by Bull 03/26/07 01:17 PM
Maybe the St Pete Times could do a store on How "company greed" affects the citizens of our state............
by Georgefromthepast 03/26/07 12:15 PM
I can't believe whats going on .It's the begining of the end. Unhappy associates
by Bj 03/26/07 11:07 AM
Management through intimidation is backwards and never works. Publix's new policy is too subjective. If an employee's reviewer simply does not like him/her (for whatever reason, i.e., dosen't walk fast enough), then forget it, the review is biased.
by Joe 03/26/07 10:33 AM
In my 70's, working at Publix 10 years,last evaluation SUPERIOR !! I'm facing a pay cut if I don't improve!!!! It's just not fair!!!!!