How a dress code becomes a lightning rod: Add Walmart

When does a dress code become a major headache? When it involves Walmart (WMT) and most of its retail workforce.

Walmart has introduced what it's calling a new dress code for its employees, a "new look" that includes rather sedate choices, such as twill pants and knit polos. While the sartorial variety isn't raising questions, the issue of cost -- as in, who bears the responsibility for outfitting employees in the new clothes -- is bringing up a host of problematic issues.

Some workers say they can't afford to shell out for new threads, thanks to their meager Walmart hourly wages. One worker, Richard Reynoso, wrote in a letter to the company's human resources manager that he's paid about $800 to $900 a month as an overnight stocker, and that he estimates the cost of three uniforms would set him back about $50.

"The sad truth is that I do not have $50 laying around the house to spend on new uniform clothes just because Walmart suddenly decided to change its policy, Reynoso wrote. "If I have to go out of pocket for these new clothes, I'm going to have to choose which bill to skip."

Those choices might include either having to cancel his phone or car insurance for the month, or to be short on rent, he added. Reynoso is a member of OUR Walmart, a group that advocates for Walmart workers.

Still, another Walmart associate tells CBS MoneyWatch that while she bought new shirts at $7.94 each to fit the new dress code, it wasn't a financial burden.

"I bought two of each color, and they last quite a long time," Barbara Pennington, an associate in Springdale, Arkansas, said of the shirts. She said she liked the new dress code, because it's giving workers more options of what to wear. Workers can continue to wear the khaki pants they had previously, but now also have the choice to wear black pants.

Workers are also now required to wear Walmart vests, following the store's break from requiring them in 2007. Walmart is buying those for its workers, according to spokesman Kory Lundberg.

For Walmart, the decision to call the new requirement a "dress code" is also coming under fire. That's because there's a major difference in how the Department of Labor classifies dress codes versus uniforms, writes Erik Sherman at Forbes.com.

If Walmart had opted to call the new standards a "uniform," the requirement would have been considered a business expense of the employer. But even if the employer requires its workers to shell out for the uniform, those workers can't see their pay drop below the federal minimum wage because of that expense.

A dress code, however, comes with no legal obligation for the employer to pay for the new threads.

That means that Walmart's policy change appears to be squarely placing the additional costs on the shoulders of its workforce. Walmart, the world's largest retailer, employs 1.3 million people in the U.S.

The policy change "will have an impact on some folks, and we have heard that," Walmart's Lundberg said. "We are working on a way to communicate back to associates that we heard them and their feedback is important."

Interestingly, Walmart isn't requiring that workers buy from its own stores, although it is marking dress-code appropriate merchandise with a "spark" on the tag, and provided workers with a link to buy clothing from Walmart.com.

Based on the prices provided by Walmart, the company could end up with as much as $78 million in new sales, thanks to its workers buying new khakis to meet the dress code, according to an estimate from OUR Walmart.

That figure is based on "a lot of assumptions," notes Lundberg. "Associates are free to buy their clothes wherever they want to. This group is making a lot of assumptions to get to this big number, without taking out anything else under under consideration."