Union Blues at Wal-Mart

Union Blues at Wal-Mart

Attempts to organize are squelched by a flying column of unionbusters.


“Got any nachos ready?”

That’s what Joe Hendrix said to the folks at the Radio Grill, his employer’s in-house snack bar. Hendrix was on his way to punch out from his shift in the meat-cutting department at the Wal-Mart Supercenter in Jacksonville, Texas; eight months earlier, in February 2000, he’d voted yes in the first successful election for union representation at a US Wal-Mart store. For failing to pay when placing his nacho order, he was fired.

Seventy-two-year-old Sidney Smith also voted yes; he got axed for eating a pre-weighed banana on the checkout line. Such were the excuses offered by management as union supporters were systematically routed from their jobs. But this was well after the real damage had been done, when Wal-Mart announced two weeks after the Jacksonville vote that it was switching to case-ready, or pre-cut, beef and would be eliminating meat-cutting operations in 180 stores. Wal-Mart claimed its decision had nothing to do with the organizing drive, but the union filed a complaint with the National Labor Relations Board. Although the board ruled in the union’s favor, the timing of the news contained a chillingly clear message to Wal-Mart workers nationwide: This is what you can expect if you try to organize.

Wal-Mart’s legendary ferocity in such situations has, until recently, kept unions from trying to make inroads in its million-strong work force. But after more than a decade of pussyfooting, the United Food and Commercial Workers union and the Teamsters are gearing up to take on Wal-Mart Stores, Inc., with the former taking the retail stores and the latter handling 100-plus distribution centers. For the UFCW, this undertaking is less the result of newfound militancy than it is about mere survival. Seventy percent of the union’s 1.4 million members work for national groceries like Kroger and Safeway, as well as smaller, regional chains. With a strong presence in the top 100, mostly urban, markets, the big chains can hold steady in the face of Wal-Mart encroachment. The regional chains, however, are getting walloped. And with Wal-Mart circling on the fringes of larger markets, its lower wages and benefits will likely erode those enjoyed by UFCW members.

In its forty-year reign Wal-Mart has amassed a jaw-dropping trophy rack of titles–“world’s largest retailer,” “world’s largest private employer” and the recently acquired “world’s largest corporation,” edging out ExxonMobil for the top spot in this year’s Fortune 500. The chain accounts for a staggering 6.4 percent of the nation’s retail sales and, as reported in The Economist, 7-8 percent of US consumer spending (excluding cars and “white goods” like refrigerators, washers and dryers). With KMart, until recently its closest rival, now in bankruptcy, the path is clear to ever greater domination.

The only Wal-Mart store to unionize successfully was in Ontario, Canada, abetted in no small measure by the province’s once-progressive labor laws. But the fledgling union was broken by the company’s flat-out refusal to recognize the contract. While a climber at Mount Everest base camp can point to the many individuals who have summited and lived, a Wal-Mart worker trying to join a union knows no such consolation. Two unions, neither a paragon of union democracy or member mobilization, face an employer that has been growing by 15 percent each year, recession and all: In the context of a labor movement that has not been weaker since the 1920s, with a legal system seemingly rigged against it, this is an Everest ascent with no Sherpas in sight.

Wal-Mart manifests itself in three main forms: The traditional Wal-Mart retail store, which peddles everything from panties to Pennzoil and averages about 90,000 square feet; SAM’s Club, a warehouse club store where “members” pay an annual fee to receive greater discounts on dry goods and groceries; and Supercenters, the company’s biggest growth vehicle, a combination retail and grocery store clocking in at 190,000 square feet. This year, Wal-Mart plans to open a new one every other day.

“Wal-Mart’s strategy is very similar to Mao Zedong’s,” says retail analyst Burt Flickinger. “Conquer the countryside first and take the cities second.” If this sounds alarmist, consider the Neighborhood Market. It’s a prototype grocery store roughly the size of three 7-Elevens. In the past few years Wal-Mart has deployed them for greater market saturation in its urban strongholds like Oklahoma City and Dallas. While zoning laws and real estate costs impede the development of most forms of Wal-Mart in the larger metro areas, the trim Neighborhood Market might squeeze into places a Supercenter could never dream of occupying.

Sam Walton built his empire on a belief that rural America saw more business than anyone in the corporate world was recognizing. This vision–combined with a zealot’s dedication to low overhead, undercutting the competition through lower profit margins and higher sales volumes, investment in technology and aggressive growth–blazed a trail for an imperial corporation that now operates in nine countries.

Walton has been dead for a decade, but he lives on as a deity, the customer-service superego of Wal-Martians nationwide. So entrenched is the myth of “Mr. Sam” as a benign patriarch that rather than contradict it, the UFCW plays along, with campaign messages about “restoring Sam’s vision.” Unfortunately, Walton’s vision never included unions. As Wall Street Journal reporter Bob Ortega chronicles in his book In Sam We Trust, Walton was bent on maintaining low labor costs, paying workers subminimum wages when he could get away with it and showing no qualms about threatening store and warehouse closures to beat back union campaigns. The company’s trumpeted profit-sharing plan and “open door policy” for addressing grievances were all born out of the pleading of Walton’s unionbusting consigliere, John Tate. Tate believed that Walton could circumvent labor problems by convincing his workers that he was on their side. For Walton, this turned out to be a winning strategy–a full-time union-prevention program.

Sam drove a pickup truck, shot quail and probably spent more time studying KMart than KMart’s own executives. He embodied a peculiarly American paradigm that endures at company headquarters in Bentonville, Arkansas, to this day. He was a self-made, rock-em-sock-em, capitalist cowboy in an industry devoted to peddling every fathomable consumer good, and yet he remained puritanically frugal in his personal and corporate expenditures. Unlike the Gap or Starbucks, Wal-Mart is not selling brand lifestyle. Its aesthetics in architecture and advertising are decidedly no-frills, its corporate offices stark. Executives pay for their own coffee, and even CEO Lee Scott has been known to share a hotel room on business trips. Wal-Mart’s subordination to the bottom line permeates all levels. For instance, to curtail frivolous energy consumption, lights, heat and air conditioning at all 3,289 US Wal-Marts are controlled from Bentonville. Not surprisingly, this ethos hits those at the bottom of the food chain the hardest.

Managers are under considerable pressure to keep profits up, and one of the few ways they can achieve this is by cutting operational costs, of which labor comprises about 50 percent. Former managers and employees attest to an unofficial policy of putting experienced “associates”–as the Wal-Martian wage slave is eloquently titled–out to pasture through firing for minor infractions or pushing them to quit by other means. Why pay $10.50 an hour when a new hire can be culled from the street for $7?

A perpetually churning work force offers the added benefit, from management’s perspective, of keeping the union out. By its own admission, Wal-Mart burns through 70 percent of all new hires each year, a considerable number in a work force of over a million. As Bernie Hesse of UFCW Local 789 in the Twin Cities explains it, the paradox of retail organizing is “I’m working retail, this job sucks. If I don’t like it I’ll go get another job that pays $6.50 an hour.” While many retail workers don’t see their jobs as being worth a long, arduous battle for representation, they also cower at the real consequences of supporting a union: demotions, reduction in hours and “got any nachos ready”-style firings.

Although the union faces skepticism and fear among workers, it has discovered a few potent organizing issues–most notably, healthcare. Effective January 1, a full-time associate with two children and no spouse would pay $36 a week for basic coverage and $3.50 for dental, in addition to a $350 deductible for each individual on the plan. This tallies out to more than $3,000 a year for someone earning less than $16,000. Should it be any surprise that only 38 percent of Wal-Mart associates elect to have coverage? When the company announced a 30 percent hike in premiums this fall, it gleefully noted that associates had a “CHOICE to elect what will be done with 1/2 of the Wal-Mart contribution to our 401(k) account.” One of these so-called choices was to “direct it toward paying health care rates.” This change was illuminated in a video so slick that SAM’s Club cashier Alan Peto said, “If I didn’t know any better I really would have thought they had done me a big favor.”

Just for shits and giggles, dial (501) 273-8300. That’s Wal-Mart’s twenty-four-hour “Union Hotline,” designed for store managers to call on the first whiff of union activity. Your kind message will activate the beeper of an associate in Wal-Mart’s “People Division.” Assuming you are a store manager (and not a pinko prankster), your call will be promptly returned. If your associates are talking union, a flying column of unionbusters will be quickly dispatched to put out the fire.

Since the UFCW began talking to meat-cutters en masse in 1999, the People Division has increased from twelve employees to nearly seventy. In terms of preparedness, though, Wal-Mart has always trumped the unions. Before any national campaign was afoot, Wal-Mart was publishing and distributing manuals like “A Manager’s Toolbox To Remaining Unionfree,” producing videos and running two-day workshops for store managers stressing their role as the “first line of defense” against a union campaign.

On paper Wal-Mart stays within the bounds of how an employer can legally respond to a union drive. “They’re cosmetics,” says unionbuster-turned-union-adviser Martin Levitt. “The company will wave them like a flag to show that they know the law, but once management and supervisors have been pulled into one-on-one meetings with the unionbusting forces, they are carefully programmed on how to break the law and told clearly that their very job depends on doing so.” While a store manager has likely been briefed on extralegal maneuvers, the dirty work is often delegated to nonsalaried department managers with no knowledge of labor law. Gretchen Adams, a co-manager at a Las Vegas Supercenter, was instructed by her district manager not to hire anyone with union experience, while Stan Fortune, a former department manager and security guard, was told to solicit grievances from union supporters, implementing raises and promotions to buy their loyalty. “I never knew I was breaking the law,” he says. Wal-Mart spokeswoman Jessica Moser Eldred said the company follows all state, federal and local labor laws. “In no circumstance do we deviate from them.”

Part of Wal-Mart’s strategy is to deny contact between workers and the union. When it owns the land on which its store sits, it will invoke trespassing laws. “It got to the point where as soon as the organizers got out of their cars, the security guards would be in the parking lots telling them to leave,” says Alan Peto. In other cases, managers or security guards shadow organizers throughout the store, making it impossible for them to speak to workers. Organizers from the UFCW international staff are currently barred from all Wal-Marts under an injunction that forbids solicitation. The company has infuriated shoppers suspected of being union organizers by ejecting them; they’ve even booted Girl Scouts and Salvation Army bell ringers for fear that contradicting its no-solicitation policy will give the union an inroad.

Faced with the inevitable litany of unfair-labor-practice charges from the union in response to its illegal maneuverings, Wal-Mart can count on the glacial pace of the labor board to stall the campaign. If the board rules in the union’s favor, the company suffers a slap on the wrist, posting a notice of company malfeasance in the break room. This is union organizing still haunted by the ghost of the 1947 Taft-Hartley Act.

The UFCW is now attempting to build a case before the NLRB arguing that Wal-Mart’s violations are not the result of a few rogue store managers but part of a systematic policy of illegal intimidation, surveillance and terminations, all designed to keep workers from organizing. The union has filed forty complaints against Wal-Mart in twenty-four states, resulting in forty complaints issued by the NLRB against the company. The UFCW hopes ultimately to attain remedies like “affirmative workplace access,” a corrective ruling from the board that allows organizers to talk to workers in break rooms and to rebut management’s captive-audience meetings, where workers are deluged with anti-union speeches and videos. Rulings for affirmative access are rare, and they typically take many years to attain. But they have been delivered with great success to UNITE at Fieldcrest Cannon and SEIU at Beverly Nursing Homes. Given a labor board stacked with Bush appointees and Wal-Mart’s legal motto of WDWDW (What did we do wrong?), however, chances of an imminent victory are remote.

In the fourteen years since Wal-Mart opened its first Supercenter, the UFCW has run a damage-control campaign bent on stemming the tide of expansion and sullying the company’s image. The union has helped call attention to Wal-Mart’s use of sweatshops and child labor overseas, as well as its bogus “Buy American” program, where the company wrapped itself in a “made in the USA” flag until it was revealed that most of its apparel was made in overseas sweatshops. The union also forged coalitions with antisprawl activists to stem Wal-Mart’s growth.

All of these are noble pastimes, but without a strategy to organize workers, about as effective as pummeling the Taliban with passages from The Betty Friedan Reader. Until recently, it was hard to tell if the UFCW was boycotting Wal-Mart, organizing it or simply functioning as a thorn in its side. The mixed messages provide the People Division an opportunity to inoculate its associates with videos like “Wal-Mart Under Attack,” which shows footage of UFCW rallies with members chanting “Wal-Mart: Not in My Neighborhood” and highlights various local efforts to get union members to sign pledges not to shop at Wal-Mart. When many associates openly identify with the company, the message that the union is against Wal-Mart packs a punch.

In the past year, however, the UFCW seems to have developed a more focused approach. Their line in the sand is Las Vegas, a city with a strong union presence in the service sector. While unionized groceries enjoy 90 percent of Vegas’s market share, Wal-Mart is making headway with five Supercenters, five retail stores and four SAM’s Clubs. Since March of last year, the union has been organizing in Las Vegas, with some activity in northeast Ohio and Texas. In Vegas, the UFCW hosts a radio show and maintains a website, www.walmartworkerslv.com, which chronicles Wal-Mart’s anti-union campaign and offers a needed arena for counterarguments and open communication among workers. (However, 12 percent of the website’s hits come from Bentonville.)

This past November, workers at Las Vegas SAM’s Club Store 6382 were set to vote in the third storewide election at a US Wal-Mart. But as the election approached, the company went into a hiring frenzy, disrupting the laboratory conditions required by the NLRB. Watching its support ebb as the company packed the unit with new hires–all of whom were subjected to anti-union videos and meetings–the union filed charges, which resulted in the board’s decision to block the election; on March 28, the NLRB issued a complaint against the company, but the best the union is likely to get is another election with little to guarantee that Wal-Mart won’t do the same thing again.

And what of the Teamsters? So far, their activity has been limited to two locals in California and Missouri. At a San Bernardino distribution center, a recent election was lost by a swing margin of twenty-eight votes–an impressive result considering management was promising $3 raises in the week preceding the election and that the campaign was the work of a single organizer. Since Wal-Mart’s distribution systems are models of efficiency and integral to the company’s success, the Teamsters and UFCW might give Bentonville a run for its money if they coordinated their efforts, applying simultaneous pressure by engaging both truckers and retail workers, thus stretching the capacity of the People Division. But in light of Teamsters organizing director John Murphy’s stated goal of transforming his department into “a desk and a telephone,” and the union’s overall stagnation under Jimmy Hoffa, it’s hard to imagine they’re going to attempt such a conquest anytime soon.

The UFCW, for its part, has taken a largely top-down approach to the campaign, which has been guided by pressure tactics coming from union HQ in Washington–with some exceptions. “I get members asking me how it’s going, how many people have signed cards, and I say what’s the point? Why go through a regular election just to get knocked down?” says UFCW organizer Bernie Hesse. “I’m not trying to go store by store; I’m trying to build a social movement.” Hesse’s Local 789 has launched a campaign called “You Are Worth More” (www.youareworthmore.org) for retail workers in the Twin Cities. Rather than home in on one particular company, Hesse’s local is planting roots in the community, establishing itself as a presence among a multiracial work force at metro-area Targets, KMarts and Wal-Marts.

There’s no single war-winning strategy for bringing the union to Wal-Mart workers. Given the UFCW’s history of bowing to hostile employers and suppressing its own dissidents, it remains to be seen whether the union is movement building or just circling wagons around its most endangered markets. At risk of excessive parade pissing, consider that even if SAM’s Club 6382 wins an election, there are still 3,288 more to go. Wal-Mart is likely to be a decades-long struggle, fought by a largely female work force with no union experience. The struggle is now being waged by a vanguard of union lawyers. Ultimately they will have to take a back seat to shop-floor workers, member organizers and, most significant, the communities where workers live. When the lines between union and community collapse, an employer’s traditional mode of attack–labeling the union an alien third party–disintegrates, and the campaign becomes less dependent on legal wrangling. Then, when Wal-Mart denies workers access to the union, wrecks an election or fires activist workers, the outrage does not come from a lone UFCW mouthpiece but from a movement.

Given this campaign’s stakes–both real and symbolic–a movement is what Wal-Mart workers need. “If these retailers are going to be the jobs of the future, if we’ve really switched from a production to a service economy, than what is so revolutionary about insisting that they pay a living wage?” asks Bernie Hesse. Millions of associates and citizens may have to ask this question a million more times before a movement becomes something tangible, and not just a feel-good progressive mirage.

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