Whole Foods 2012 Annual Report Download - page 17

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between approximately 40 and 650 team members who generally comprise 10 self-managed teams per store, each led by a team
leader. Each team within a store is responsible for a different product offering or aspect of store operations such as prepared
foods, grocery, or customer service, among others. We also promote a decentralized approach to store operations in which many
decisions are made by teams at the individual store level. In this structure, an effective store team leader is critical to the success
of the store. The store team leader works closely with one or more associate store team leaders, as well as with all of the department
team leaders, to operate the store as efficiently and profitably as possible.
Team members are involved at all levels of our business. We strive to create a company-wide consciousness of “shared fate” by
uniting the interests of team members as closely as possible with those of our shareholders. One way we reinforce this concept
is through our Gainsharing program. Under Gainsharing, as part of our annual planning process, each team receives a labor
budget expressed as a percentage of their team’s sales, with leverage built into the budgets on an overall company basis. When
teams come in under budget due either to higher sales or lower labor costs, a portion of the surplus is divided among the team
members and paid out every four weeks, and a portion is set aside in a savings pool. When teams are over budget (or in a labor
deficit position), no Gainsharing money is paid out. Instead, the overage is taken out of the team’s savings pool or, in the absence
of savings, paid back using future surpluses. The savings pool is paid out annually after the end of the fiscal year to all teams
with a positive balance. Rewarding our team members for increases in labor productivity, something they can control, gives
them a direct stake in the success of our business. We also encourage stock ownership among team members through our broad-
based team member stock option plan, stock purchase plan and 401(k) plan.
Team Members
We created more than 8,500 new jobs throughout the Company in fiscal year 2012. As of September 30, 2012, we had
approximately 72,700 team members, including approximately 53,100 full-time, 16,400 part-time and 3,200 seasonal team
members. Full-time team members accounted for approximately 76% of all permanent positions at the end of fiscal year 2012,
with voluntary turnover of less than 10%. We believe this is very low for the food retailing industry and allows us to better serve
our customers. All of our team members are non-union, and we consider our team member relations to be very strong.
For the past 15 years, our team members have helped Whole Foods Market become one of FORTUNE magazine’s “100 Best
Companies to Work for in America.” Ranking 32nd overall and 8th among large companies in 2012, we are one of only 13
companies to make the “100 Best” list every year since its inception.
We believe in empowering our team members to make Whole Foods Market not only a great place to shop but a great place to
build a career. Our salary and benefits programs reflect our philosophy of egalitarianism. To ensure they are perceived as
fundamentally fair to all stakeholders, our books are open to our team members, including our annual individual compensation
report. We also have a salary cap that limits the total cash compensation paid to any team member in a calendar year to 19 times
the average annual wage, including bonuses, of all team members. In addition, our co-founder and Co-Chief Executive Officer,
John Mackey, has voluntarily set his annual salary at $1 and receives no cash bonuses or stock option awards.
All of our full-time and part-time team members are eligible to receive stock options through annual leadership grants or through
service-hour grants once they have accumulated 6,000 service hours (approximately three years of full-time employment).
Approximately 95% of the equity awards granted under the Company’s stock plan since its inception in 1992 have been granted
to team members who are not executive officers. In fiscal year 2012, more than 14,500 team members exercised over 6.7 million
stock options worth approximately $197.1 million in gains before taxes, or an average of about $13,600 per team member.
As medical costs continue to rise, we periodically restructure how costs are shared between the Company and team members
to ensure our health plan remains sustainable. By participating in our company-wide benefits vote every three years, team
members can take an active role in choosing the benefits made available by the Company and how they share in the cost. In our
most recent vote, held in September 2012, 82% of eligible team members cast a ballot to determine the Company’s medical plan
for 2013. Under this new plan, Whole Foods Market will provide health care coverage at no cost to full-time team members
who work 30 or more hours per week and have worked a minimum of 20,000 service hours (approximately 10 years). Full-time
team members with 800 to 19,999 service hours will pay a premium of $10 per paycheck. Under the Company’s 2012 plan,
health care coverage was provided at no cost to full-time team members who work 30 or more hours per week and have worked
a minimum of 10,000 service hours, while full-time team members with 800 to 9,999 service hours paid a premium of $10 per
paycheck. In addition, the Company provides personal wellness dollars in the form of either a health reimbursement arrangement
(“HRA”) or health savings account (“HSA”). Based on service hours, team members receive up to $1,800 per year to help cover
the cost of deductibles and other allowable out-of-pocket health care expenses not covered by insurance.
Two initiatives developed to support our Core Value of Promoting the health of our stakeholders through healthy eating education
were specifically designed for our team members. They include the Total Health Immersion Program and the Healthy Discount