Walgreens is changing the benefits it offers employees and eliminating health insurance for most of its eligible retirees, just months after announcing it would boost hourly wages for store employees.
Starting in 2019, employees of the drugstore chain won't qualify for paid time off unless they work at least 30 hours a week, said Walgreens spokesman Brian Faith. Currently, employees can qualify for paid time off if they work at least 20 hours a week.
About 550 Walgreens retirees under 65 now receive subsidized health insurance from Walgreens, though about 3,000 are eligible.
The cuts follow a Walgreens announcement in March that it would increase pay for hourly workers by $100 million a year.
The raises took effect Oct. 1, Faith said. They're expected to benefit about 100,000 of Walgreens' 170,000 store workers, he said.
Walgreens also is adding a paid parental leave benefit, effective immediately, that will offer full pay for eight weeks of leave to new mothers and fathers. The company also is expanding short-term disability leaves for hourly employees working at least 30 hours a week.
Other retailers have also upped their wages in recent years, including Walmart, CVS Health and Target. Earlier this month, Amazon pledged to increase employee pay to at least $15 an hour, but it also decided to get rid of monthly bonuses and stock awards for warehouse workers and other hourly employees.
Walgreens' changes to its pay and benefits are meant to "help attract and retain our valued team members and remain market competitive," Faith said in an email.
"As we evaluate our employee benefits on an ongoing basis, we will continue to listen carefully to feedback from our team members and make adjustments accordingly," he said. "The recent changes include new investments in areas employees have told us are important to them and their families."
Walgreens retirees who now receive health insurance benefits will continue to receive coverage through 2019 and transition assistance, including the ability to buy coverage at the Walgreens employer rate. Walgreens will continue to subsidize health care benefits for retirees who, as of March 31, 2019, are at least 64 and have worked at Walgreens for at least 24 years. The company does not subsidize coverage for retirees older than 65.
