Dollar General and Dollar Tree are both facing proposals from activist investor firms aiming to improve their worker safety and wages. Domini Impact Investments has called for an independent audit into worker safety and well-being at Dollar General, while United Church Funds is seeking the creation of a wages and inequality report on Dollar Tree.
Low Worker Retention Cited in Dollar General Proposal
Domini has called for Dollar General Proposal 7, which will be voted on during the company’s annual shareholder meeting May 31. The investor has stated that Dollar General lacks “adequate systems” to handle challenges caused by supply chain disruptions and shipping delays, particularly unpredictable shipments and influxes of inventory, due to its poor worker retention rate. Safety issues have contributed to this, as well as its lack of a commitment to a higher minimum wage at a time when other retailers are pushing wages higher.
Dollar General has faced more than $15 million in fines from the U.S. Department of Labor’s Occupational Safety and Health Administration (OSHA) for safety hazards since 2015, including blocked fire exits, blocked electrical outlets and dangerous levels of clutter. In April, OSHA said that since 2017 it has cited Dollar General in more than 180 inspections nationwide.
The off-price retailer has taken some steps to address complaints about pay. Dollar General is investing nearly $100 million to increase labor hours for its more than 170,000 store employees in 2023 to enable “consistent store standards while further enhancing the associate and customer experience,” according to CEO Jeffrey Owen. The retailer added more than 10,000 net-new jobs in 2022.
Dollar General is calling on shareholders to vote “against” Proposal 7 as well as several other investor proposals.
Dollar Tree Faces Diversity Pressure
Dollar Tree Proposal 5, led by United Church Funds, calls for the creation of a wages and inequality report. The proposal notes that Dollar Tree employs more than 210,500 associates and reports median annual pay of $13,490, which is below the 2022 $13,590 federal poverty level for a single person. Additionally, while the retailer’s workforce is 67.8% female and 55.2% minority, these demographics make up 24.8% and 18.4% of officer- and director-level management positions, respectively.
Dollar Tree is planning to increase average wages by $2 per hour, but United Church stated that inequality at the company will “reduce long-term diversified portfolio returns.” Dollar Tree has asked shareholders to vote “against” Proposal 5, which will be voted on during the retailer’s annual meeting June 13.