Target announced on Wednesday that it is raising its minimum wage for U.S. hourly workers to $15 starting on July 5.
The current minimum wage for hourly workers at the company is $13, which was set in June 2019. The $2 bump is the culmination of a plan the retailer set out to achieve in 2017, when it announced it would increase its starting hourly pay from $10 to $15 by the end of 2020. The Minneapolis-based retail giant said the wage applies to all hourly full-time and part-time workers at stores, distribution centers and headquarter locations.
The change in minimum wage will effectively give a raise to about 275,000 employees, Target said.
Target also said it will give its frontline store and distribution center hourly workers a one-time recognition bonus of $200 “for their efforts throughout the coronavirus pandemic.” The bonus will be distributed at the end of July to eligible full-time and part-time hourly workers at Target stores and distribution centers. Target noted that this bonus is on top of bonuses that were paid out in April to 20,000 hourly store team leads who oversee individual departments in Target stores.
Target officials said with the new changes, the company is investing “nearly $1 billion more this year in the well-being, health and safety of team members” than it did in 2019. Target also said it’s extending benefits it began offering during the pandemic, including free backup care for employees’ children or needy adults through August, free mental health counseling and 30-day paid leave for employees at higher risk of COVID-19.
Starting this week, the company added a new benefit: All employees can get free access to virtual doctor visits through the end of the year, even if they do not get health insurance through Target.
Target’s starting pay increase matches them with Amazon, which increased its minimum wage to $15 in 2018, and increases the company’s pay advantage over Walmart, which has a minimum wage of $11 an hour. The federal minimum wage is $7.25, which was last increased in 2009. Some states and cities have set the bar higher than the federal requirement.