You cannot turn to a news channel without hearing about President Trump‘s tax plan signed into law three days before Christmas 2017. There are many detractors of this new law, all saying how it will hurt the middle class. These detractors tell how many people will not get the benefit of these tax cuts. But what is the real story behind the new Trump tax plan and what it will do for American citizens?
Eighty-one companies publicly announced giving their employees bonuses, many increased wages of their employees, or are currently offering other employee benefits since Trump signed his tax reform bill into law.
Walmart is one of the latest company crediting the lower corporate tax rate as one of the main reasons to reinvest in both the business and employees. The world’s largest private employer announced Thursday 11 January it would increase it’s starting wage for US employees to $11. Most starting employees began at $9 but was recently bumped up to $10 upon completing the training program. Walmart CEO Doug McMillon said the recent tax reform legislation gives the company an opportunity to be more competitive globally, and accelerate Walmart plans for growth in the United States.
Additionally, eligible Walmart employees are going to receive a one time bonus of up to $1000. Additional employee benefits are receiving ten weeks of paid maternity leave and six weeks of paid parental leave.
Other companies jumped on the tax cut legislation bandwagon and implementing strategies to increase employee wages and benefits. While the Walmart pronouncement may be getting the most newsworthy coverage, other companies have begun similar approach in salaries and benefits to be more competitive.
Although this is not a comprehensive list list of companies benefiting from the new tax laws, the list illustrates an across-the-board look at US companies with middle-class employees and what they’re offering them. In some cases, corporations like Boeing are using the money to increase infrastructure and charitable giving. Here is a random list I chose from a recent Washington Examiner article:
- AT&T: $1000 bonus to all 200,000 US employees.
- AFLAC: increase in matching funds of 401(k)s from 50% to 100% on the first 4% of compensation, plus a one time $500 contribution every to employees 401(k).
- American Airlines: $1000 bonus for approximately 127,600 employees.
- Ball Ventures: $100 bonus for each year worked to all employees.
- Bank of America: $1000 bonus for all 145,000 US employees
- Boeing: $300 million for “workplace of the future” facilities, infrastructure, workforce development, and charitable giving.
- Citizens Bank: $1000 bonus for all 12,500 employees.
- Gulf Coast Bank and Trust: increasing base wages to $12 per hour.
- Melaleuca: $100 bonuses for each year worked for 2000 employees.
- Nationwide: $1000 bonus for 29,000 employees.
- PNC Financial Services Group: $1000 bonus for all 47,500 employees.
- Sinclair Broadcast Group: $1000 bonus for 9000 employees.
- Southwest Airlines: $1000 bonus for 55,000 employees.
- Travelers: $1000 bonus for 14,000 employees
- US Bancorp: $1000 bonus for 60,000 employees.
- Walmart: increasing the starting wage to $11; expanding maternal and paternal leave benefits; one-time cash bonus for all eligible associates of up to $1000.
- Wells Fargo: increased its base wage from $13.50 to $15 per hour
In all fairness, some companies are laying off people and are restructuring. Those restructuring plans have probably been in the works for a while and are not a byproduct of this new tax plan. What this list illustrates is there’s more money out there. Companies now have the cash to pay hardworking employees. The competition for a skilled workforce is extremely keen, and companies now can offer bigger pay packages to new hires.
It is too early to tell the magnitude of change tax reform legislation may cause. But if the stock market is an indication, now above the 25,000 territory, it looks like President Trump’s new tax reform put money back in the economy and set it in the right direction.