BJ’s pays out $8 million in worker recognition bonuses

This month, BJ’s Wholesale Club is giving club and distribution center workers onetime appreciation bonuses for their continued extra efforts aim the COVID-19 pandemic.

Plans call for recognition bonuses of $300 for full-time and $150 for part-time associates to be paid out in August, BJ’s said yesterday, when it also reported second-quarter earnings. Managers also have received special appreciation payments, but BJ’s didn’t disclose the size of the bonuses.

The Westborough, Mass.-based warehouse club chain said the bonus round totals $8 million and is part of the company’s workforce investment during the pandemic as well as for its expansion efforts.

“Our team members are the key to our success, and I am incredibly proud of their continued dedication to serving our members during these challenging times,” Jeff Desroches, executive vice president and chief operations officer at BJ’s Wholesale Club, said in a statement. “We’re thrilled to recognize and reward our club and distribution center team members with this bonus. By continuing to invest in our team members, we are powering our own growth and acknowledging those that have worked hard to help us accelerate our transformation.”

BJ's average hourly wage is now well above $15 per hour, according to CEO Robert Eddy.

BJ’s announced its first round of extra pay in late March 2020, just over a week after the United States declared COVID-19 a national emergency. The retailer enacted a temporary wage increase of $2 per hour for all hourly workers in clubs, distribution centers and the home office. Also, managers and key personnel in clubs and distribution centers received one-time bonuses of $500 to $1,000.

Related:BJ’s Wholesale Club builds on prior-year gains in Q2

In a conference call Thursday on quarterly results, BJ’s President and CEO Robert Eddy noted associates’ pivotal role in driving market share gains in the 2021 first half.

“Furthermore, we elevated the value proposition to our team members through meaningful investments in wages and bonuses. Our team members are central to driving our strategy forward, and these investments will help us attract, retain and motivate the best talent and help ensure that they can thrive in our business,” he said.

BJ’s workforce investments also reflect the current tight labor market in the United States, according to Eddy.

“Labor challenges are impacting our industry, like many others. For a long time, we have chased the labor market. Recently, we’ve chosen a different path, a path that calls for a significant investment in our team, backed by our great financial performance to ensure that we get ahead of market forces and better serve our growing membership,” he explained. “Specifically, we have made the largest increases in starting hourly wages in our history. In addition, we awarded our club and distribution center team members this quarter with a onetime recognition bonus for appreciation of their continued hard work and commitment to serving our members. These investments are materially Q2, and we expect these investments to get larger as we go through the year.”

Related:Bob Eddy named CEO of BJ’s Wholesale Club

For the 2021 second half, BJ’s expects to record about $30 million in costs from investments in labor and COVID-related safety and sanitation.

“Our average hourly wage is now well above $15 per hour, and we will continue to invest in our teams so that we can recruit and retain top talent across our footprint,” Eddy said.

BJ’s labor investment also comes amid its continued brick-and-mortar expansion, with the company noting that more associates will be need to staff new clubs.

BJ’s also will continue to steadily expand its brick-and-mortar footprint. One new club was opened in the second quarter, and another five are slated to open in the fourth quarter. The company also is aiming to open 10 or more new clubs in 2022. Currently, the retailer operates 222 clubs and 151 BJ’s Gas stations in 17 states.

“You’re only as strong as your team, and we need the best team on the field every day. Wages are a big component of that. And this year has been an incredibly dynamic labor market for us, as every industry really is suffering some sort of a labor shortage to one degree or another,” Eddy told analysts on the call.

“Continuing to recruit great people and service our members is really what I’m after here, and we will continue to invest in our team going forward,” he added. “As one of my competitors talked about yesterday, I don’t think this is going to change. I think labor pressure will continue. Wage pressure will continue, and we’ll continue to invest to put the best team on the field that we can.”