Some of the cash windfall from corporate tax cuts is already trickling down to Main Street workers.
A handful of U.S. companies are already promising to pay one-time bonuses to their employees and bump up hourly pay if President Trump signs into law the tax reform bill that has been voted on by the Republican-led Congress.
AT&T was the first company to go public with its plans to pass along coming tax savings to workers, saying once the tax bill is passed it would pay a special $1,000 bonus to more than 200,000 of its non-management workers. The bonus could hit employees paychecks over the holidays if Trump signs the bill before Christmas, the company said in a statement. The telecom giant also confirmed it would invest $1 billion more in the U.S. in 2018.
“Congress, working closely with the President, took a monumental step to bring taxes paid by U.S. businesses in line with the rest of the industrialized world,” Randall Stephenson, AT&T chairman and CEO, said in a statement. “This tax reform will drive economic growth and create good-paying jobs. In fact, we will increase our U.S. investment and pay a special bonus to our U.S. employees.”
Comcast announced Wednesday that it would award one-time $1,000 bonuses to more than 100,000 employees, which would include frontline and non-executive employees.
The Communication Workers of America, the union that represents many of those frontline workers, had demanded that employers guarantee the yearly $4,000 household wage increase that Republican lawmakers asserted would be the outcome of the tax cut.
Other companies, including Fifth Third Bancorp, Wells Fargo and Boeing, also announced that they would pass along tax savings to their workers.
The news is the first sign that many in the middle-class will benefit financially from their employers paying less in taxes.
The tax reform bill, which includes a big and permanent tax cut for corporations and temporary tax relief for individual taxpayers, has fostered a heated debate on Capitol Hill and on Wall Street as to whether middle-class Americans would benefit as much as big business will.
Corporate announcements in addition to AT&T's that were rolled out Thursday that show workers will share in the benefits include:
Fifth Third Bancorp, a regional bank based in Cincinnati, said it will raise the minimum wage for all of its nearly 3,000 hourly employees to $15, and would distribute a one-time bonus of $1,000 for more than 13,500 employees by the end of the year if the bill is signed by Dec. 25.
“We want to invest in our most important asset – our people,” said Fifth Third president and CEO Greg Carmichael. The tax cut, the CEO said, provided an opportunity for the bank to "reevaluate its compensation structure and share some of those benefits with its talented and dedicated workforce."
Wells Fargo, the San Francisco bank that has been hurt by a scandal involving the opening of 3.5 million unauthorized client accounts, also said it would boost its minimum wage to $15 per hour, an 11% increase from its current hourly rate of $13.50, once the law was passed. The pay raise will go into effect in March 2018, the company said.
Aerospace giant Boeing said it would move forward with $300 million in investments as a result of the new tax law, including $100 million in employee training and education and $100 million to enhance Boeing facilities as part of its "workforce of the future" initiative.
"Each of these investments benefits Boeing's most important strength – our employees – and reflects the real-time impact and economic benefit of the reforms," Boeing CEO Dennis Muilenburg, said in a statement.
Media and cable company Comcast said it would award special $1,000 bonuses to more than 100,000 eligible employees. The company, which also owns NBCUniversal, said it also expects to spend more than $50 billion over the next five years investing in infrastructure to improve and extend broadband plant and capacity, and its television, film and theme park offerings.
"With these investments, we expect to add thousands of new direct and indirect jobs," the company said in a media release.