posted 02-12-2004 12:00 AM            

Editorial

Wal-Mart shows evidence of "collective psychopathy" when it takes employee exploitation to ghoulish heights with "dead peasant" life insurance policies.

by

R.H. Meyer

In violation of Texas law, Wal-Mart has been taking out life insurance policies on its employees without their knowledge and naming the company as beneficiary. Another prominent user of these "dead peasant" insurance policies is, you guessed it, Enron. The difference between the Enron and Wal-Mart in this matter is that Enron didn't break Texas Law as did Wal-Mart. In Texas, it is illegal for any person or company to take out a life insurance policy on any other person without telling the person first. Wal-Mart chose to ignore Texas law when it took some 350,000 dead peasant policies on employees, including Texas employees, without telling them.

The arrogance of Wal-Mart in purchasing these policies in defiance of Texas law is almost beyond belief. The ghoulishness of this practice speaks to the utter disregard - indeed contempt - that Wal-Mart holds for its "associates". Executives enriching themselves on the death of their employees. How low can one sink?

I wonder how secure Mr.Coughlin and the rest of the executives and directors of Wal-Mart would feel if Wal-Mart employees started purchasing life insurance on them without their knowledge. Do you think it might give them cause for concern? There's a reason the "insurable interest" doctrine in exists in Texas*. And, there is need for a similar doctrine at the federal level.

Several years ago Wal-Mart embarked on a television ad campaign featuring older semi-retired employees in an apparent attempt to recruit older folks into their employ. Is it possible that Wal-Mart valued its older "associates" in a more sinister way?

Conclusion: Wal-Mart is a company without a conscience. If Wal-Mart was a person, the terms "psychopath" or "sociopath" would apply. But Wal-Mart is a corporation, an "artificial person" under the law. So, in Wal-Mart's case, there seems to be a "collective psychopathy" on the part of its directors and executives. It's time for the Texas Attorney General take steps to control this monster.

Notes:

* Drane v. Jefferson Standard Life Ins. Co. 139 Tex 101, 161 S.W.2d 1057, 1058 (1942) an insurable interest:

...is determined by monetary considerations, viewed from the standpoint of the beneficiary. Would he regard himself as better of from the standpoint of money, would he enjoy more substantial economic returns should the insured continue to live; or would he have more, in the form of the proceeds of the policy, whould she die? Therefore it is said that if the situation is such that he might be led to conclude that he would profit by her death, the policy contract is void as to him since the public has a controlling concern that no person have an interest in the early death of another, an interest that may give rise to a temptation to destroy her life.

The Ellen E. Schultz and Theo Francis of the Wall Street Journal state the case a bit more bluntly in the article 'Janitors Insurance' Issue Leaves Workers in the Dark on Coverage (April 24, 2002) when they state:

Until the 1980s, employers weren't allowed to take out policies on workers because they had no "insurable interest" in their survival. In other words, the company couldn't argue that it would suffer financial hardship if janitors, file clerks and nonessential executives perished. Insurable interst rules were designed to prevent life insurance from providing an incentive for murder or negligence, and ultimately discourage one person from "wagering" on the life of another.

This editorial is a statement of opinion by the management of TexasSportsNetwork and TexasSportfishing.com who take sole responsibility for its content. You may direct your comments to: rhmeyer@yahoo.com.

Copyright © 2003 R.H. Meyer - All rights reserved.

Related Links:

The Wal-Martization of the American workforce - New York Times Editorial - November, 2003

Wal-Mart shows more evidence of "Collective Psycopathy" - A willingness to break immigration and labor law just to get their floors cleaned on the cheap. Editorial by R.H. Meyer

Bill would end tax advantages for death benefits. By L.M. Sixel, Houston Chronicle

Law firm seeks niche in dead peasant policy defense. by L.M. Sixel, Houston Chronicle

With friends like Rod Ellis looking out for us, who needs republicans? Editorial by R.H. Meyer

S.B. 137 - Authorizing companies to purchase irrevocable "dead peasant" policies on employees. Authored by Sen. Rodney Ellis D-Houston

H.B. 152 CERTAIN LIFE INSURANCE POLICIES INSURING EMPLOYEES PROHIBITED. Authored by Rep. Ron Wilson, D-Houston

Corporate ethics hits a new low. Walmart found to be stealing from its employees. Editorial by R.H. Meyer

Dead Peasant Insurance on Texas State Retirees? Good God! What's Next!

Satire: "Who needs peasants? We'll just buy 'dead pheasant' insurance." says Texas house republican.

Are you concerned about corporate ethics and its impact on the economy? Read this from Findlaw.com:

WHY CORPORATE AMERICA'S NEW ASSET IS ETHICS, AND ENFORCEMENT OF THE SARBANES-OXLEY ACT OUGHT TO HELP THE STOCK MARKET
By TOM TAULLI

posted 02-12-2004 01:08 PM            

Of course, it is tacky. If they're going to buy life insurance on their employees they ought to make it a benefit and name the employee's family as the beneficiaries. So yes, it's tacky although I wouldn't go so far as unethical as long as they're not killing their employees to collect cash.

I say it's illegal in Texas in THIS case because according to this article, Texas does allow a company to take out life insurance on an employee if the company has "a sufficient expectation of financial gain" from keeping the insured worker alive.". That (was) a grey area. But it is true that it was later decided in a Texas court that "An employer does not have a pecuniary interest in the continued life of its employee, unless that employee is crucial to the operation of the business" so the life insurance policies on common workers wouldn't be consistent with Texas law.

However, it is interesting to note that the above court decision regarding Texas law was in 1998 and WalMart stopped the practice of these life insurance policies the same year--so it is entirely possible WalMart purchased the policies in question before it had been definitively decided by a Texas Court whether WalMart had a "sufficient expectation of financial gain" and, thus, while tacky, it's not clear that WalMart flagrantly violated Texas law unless they continued purchasing such policies after the court had made the above ruling.

posted 02-12-2004 03:48 PM            

If Wal-mart started treating their workers decently and gave them a LIVING wage, as well as stocking their stores with AMERICAN goods and GET RID OF all the RFID tracking chips in their products, I might consider shopping at one.

posted 02-12-2004 06:42 PM            

quote:

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Originally posted by KNOW-THIS:
I can't believe that anyone could see it any other way.

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Believe it.

posted 02-12-2004 07:18 PM            

It's a whole lot more than "tacky!"

Downright sleezy!

posted 02-13-2004 09:26 AM            

quote:

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Originally posted by Mech:
Ill bet Lex shops at Wal-Mart.

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