Fighting Back

What the unions have learned -- and what they may still
need to learn -- about fighting Wal-Mart's expansion
Liza Featherstone | April 13, 2011

http://prospect.org/cs/articles?article=fighting_back


"Be very careful who you let into your neighborhood,"
Sandra Carpenter, a former Wal-Mart grocery manager
from Maryland, warned New Yorkers considering whether
to bring Wal-Mart to their town. "They will promise you
everything under the sun," she said at a recent
anti-Wal-Mart rally outside New York City Hall, "but at
the end of the day, they will take it all back."

Wal-Mart's high-profile effort to expand into some
major urban markets has suddenly cast a spotlight on
the experiences of Wal-Mart workers like Carpenter and
launched a battle that both Wal-Mart and the United
Food and Commercial Workers (UFCW), the union that
represents grocery workers, badly need to win.

We've seen this fight before. Six years ago, Wal-Mart
tried hard to break ground in Chicago, New York,
Washington, D.C., and other cities. Opposition was
fierce, and the battles were bruising for both Wal-Mart
and its opponents -- revealing institutional and
political weaknesses on both sides. This round promises
to do the same.

The last wave of expansion battles, particularly in
Chicago, where Wal-Mart won approval to build several
stores, revealed ineffectiveness and division in the
labor movement. Once Wal-Mart agreed to build those
stores using union construction crews, the Chicago
building trades unions supported Wal-Mart's entry into
the city -- a deal that struck much of the local labor
movement as a tremendous betrayal. The deal also
revealed how little influence labor has over
Democratic-elected officials in some nominally
Democratic cities. Mayor Richard Daley vetoed a bill
that would have forced Wal-Mart to pay $13 per hour as
a condition of operating in Chicago -- the sole veto of
his epic, Mubarak-esque mayoralty.

Worse, Wal-Mart was able to focus public attention on
one of labor's imperfections: At a time of declining
membership, union contracts are not always that good.
Wages for some UFCW workers in Chicago, contends
Wal-Mart's director of community affairs, Steve
Restivo, were no better than those for Wal-Mart
workers. UFCW officials and academics who have studied
Wal-Mart acknowledge that wages for new workers and
part-timers in unionized stores may not be very high
but note that unionized supermarket workers see their
wages and benefits increase as they accumulate
seniority on the job, which is not the case for
longtime Wal-Mart workers. The company has consistently
declined an invitation from New York UFCW locals to
have the state controller audit its records to
ascertain its actual wage levels. Nonetheless, Restivo
says that Wal-Mart scored a public-relations success by
publicizing the low wages paid to new hires in some
unionized stores. "We were aggressive in telling that
story in Chicago, Restivo says.

Understandably, this is a strategy of last resort for
Wal-Mart, since the company would presumably not prefer
to be dragged into a discussion of its everyday low
wages. Even now, Restivo does not want to speak of
"minimum" or "living" wages; he prefers words like
"prevailing" or "competitive." But to fight Wal-Mart,
the UFCW is going to have to become a more aggressive
and strategic union, one in which nobody has a contract
with Wal-Mart-level wages and everyone knows the value
of a union card. Some locals are more effective than
others, and the one in Chicago wasn't one of them.
Another, related lesson of Chicago was that a union has
to be able to mobilize its members. Dorian Warren, a
political science professor at Columbia who was
involved in the 2005 Chicago site battles and is now
working with Jobs With Justice to keep Wal-Mart out of
New York, says the local's attitude in Chicago was
"definitely don't organize the members, or they could
organize against you." That kind of thinking has to
change.

But the battles have revealed Wal-Mart's weaknesses,
too. Since most development in New York is, to say the
least, not constrained by any democratic processes,
Wal-Mart, in 2005, didn't feel it had to make a case to
New Yorkers. This turned out to be a gross
miscalculation; the City Council was so angered by
Wal-Mart's arrogance -- in not showing up to City
Council hearings on its proposed store -- and disturbed
by the retailer's record on workers' rights issues,
including sex discrimination, that elected officials
actually warned Vornado Realty Trust, the developer, to
expect trouble with its other projects if it let
Wal-Mart into its new mall in Queens.

Five years later, as it again seeks to enter the New
York market, Wal-Mart apparently hasn't learned from
its 2005 rebuff: The company still doesn't show up to
City Council hearings, preferring instead to denounce
the democratic process -- which has included testimony
from former Wal-Mart workers and academics who have
studied the company -- as a circus. Members of the
council are becoming irked, and even the New York Post
(which, as the leading source of right-wing populism in
the New York area, should be this retailer's best
friend) mocked Wal-Mart's no-show performance with a
picture of an empty chair and the headline, "Empty
seats are hard-sell."

In some ways, however, the company is in a better
political position now than it has been in the past.
Says Restivo, in an implicit admission of past sins,
"We're a better company than we were four years ago."
He points to some undeniably impressive facts, such as
the company's dramatic reduction in greenhouse gases.

The company still has a major political problem,
though, that won't go away no matter how slick its
spokespeople or how green its lightbulbs. Jennifer
Stapleton, assistant director of the UFCW's Making
Change at Wal-Mart campaign, points out, "Wal-Mart
wants to talk about everything else that the
progressive community cares about but not how it treats
workers." That open wound -- Wal-Mart's treatment of
its own employees -- has festered, and this time
around, it may expose the company to even more
criticism. With Wal-Mart the largest private employer
in the nation, an awful lot of people have now worked
for the retailer, and many of their stories are
devastating. Former and current Wal-Mart workers seem
to be more involved in these urban-site battles than
they've ever been before. In addition to Sandra
Carpenter, several other Wal-Mart employees spoke at
the New York City Council hearing. Ernestine Bassett,
who still works for Wal-Mart, spoke harrowingly of
being denied bathroom breaks; a diabetic, she needs
these breaks not just for the usual reasons but in
order to give herself insulin shots.

Wal-Mart emerged from those 2005-2006 battles with one
store in Chicago; a second was approved last summer,
and Wal-Mart plans six more by 2013. The retailer
failed to win entry to New York City or Washington,
however. Wal-Mart retreated for a time, but now, out of
economic necessity, it's back in the game of urban
politicking.

The difference between four years ago and now is the
Great Recession.

For Wal-Mart, the economic downturn has reduced the
purchasing power of its patrons, making it more
imperative than ever to expand its revenues by entering
the big urban markets from which it's been excluded.
For the UFCW and its community allies, however,
economic hard times make it more difficult to keep
Wal-Mart out. The urban poor are far more desperate for
jobs and low prices. Wal-Mart has dramatically
escalated charitable giving in the cities it's trying
to enter, especially to organizations fighting hunger
-- a problem that has taken on new urgency with so many
out of work. It has also aggressively courted black
communities in Washington, D.C., underwriting the
city's Black History Month programs in February and
giving generously to schools that serve primarily black
students.

For all of those reasons, some urban communities may be
more willing to cut a deal with Wal-Mart than they were
last time around. It is pretty easy to promise
"competitive" wages in neighborhoods with more than 20
percent unemployment -- there isn't any "competition."
The fact that the company has been positioning itself
as more socially conscious in recent years and has
hired much better public-relations people may help
persuade educated urbanites who don't have close ties
to workers. Wal-Mart has aimed to buy off Washington,
D.C.'s liberal establishment with surprising
contributions to liberal think tanks like the Center
for American Progress and De'mos (with which the
Prospect is affiliated) and unsurprising contributions
to environmental groups like the Earth Day Network. In
Boston, it has made a sizable donation to Harvard. And,
as if aiming to provide fodder for comedians, the
company, which is still the target of the largest
sex-discrimination suit in history, has also made a
donation to a group called Women Work! The National
Center for Women's Employment.

Wal-Mart is also making strategic political donations,
including to D.C. City Council Chair Kwame Brown, whom
the company probably didn't need to buy since he worked
in Wal-Mart management for three years. Brown supports
Wal-Mart coming to town, with some mild concessions to
the community. Washington, meanwhile, is home to not
one but two anti-Wal-Mart coalitions. One -- Wal-Mart
Free DC -- is opposed to Wal-Mart's entry into
Washington under any conditions. "We don't want
Wal-Mart anywhere, ever," says Nkrumah-Ture, who
briefly worked for Wal-Mart many years ago. The other,
Respect D.C., a coalition backed by the UFCW's
Washington local, would allow Wal-Mart to come in if
the company signed a municipally enforced community
benefits agreement (CBA) requiring it to pay living
wages, permit organizing, and hire local residents.

Wal-Mart, however, doesn't see any difference between
the two camps. Restivo says that Wal-Mart will agree
only to "prevailing," not "minimum" wage standards and
won't agree to allow workers to form a union. Any CBA
that the UFCW would agree to, then, is off the table.
While Restivo says that Wal-Mart has signed CBAs "all
over the country," including at its stores in Chicago,
none of them are legally binding. Neither do they
commit the company to anything that goes beyond its
normal labor practices. For its store in the Pullman
neighborhood of Chicago, scheduled to open in 2013,
Wal-Mart agreed to "make a good-faith effort" to offer
employee discounts and to bring new jobs and tax
revenues to the area. Not a word about permitting union
organizing or meeting specific wage standards. The
Pullman CBA states that wages will be "competitive" --
as almost all wages are in a market-based system.

Still, the cities where Wal-Mart wants to open stores
-- which also include Minneapolis, Boston, and many
more -- have millions of consumers, and Wal-Mart can't
necessarily afford to blow off all their demands. The
recession has changed the game for Wal-Mart, perhaps
even more than for its opponents. Years ago, retail
analysts probably would have predicted that recession
-- and weak recovery -- would be great for Wal-Mart.
After all, recessions produce a lot of poverty, and the
poor have been Wal-Mart's best customers. But it hasn't
worked out that way.

With unemployment high, Wal-Mart's core customers have
become simply too poor and too frugal to do much
shopping. The retailer has been losing out to dollar
stores, where one can make smaller purchases: The poor
are becoming too poor to buy in bulk. As fuel costs
become a daily nail-biter for so many, it's also
important that the dollar stores are more easily
reached on foot or by bus. Wal-Mart's sales have been
lagging; the retailer's February earnings report
disappointed expectations on Wall Street that were
already low. On top of these recent woes, financial
analysts have agreed for some time that Wal-Mart has
saturated rural and suburban America, that efforts to
expand overseas haven't gone well, and that the company
needs new markets. Urban America is the only place left
for Wal-Mart to grow.

The company's business model has run its course, insist
many at the UFCW, and the company has to be in these
urban markets now. Pat Purcell of New York's Local 1500
says, "Last time [coming to New York] was, on
Wal-Mart's part, a desire. This time it's a need."

To be sure, Wal-Mart is no stranger to cities. The
retailer has operated for years in such nonunion
bastions as Dallas, Houston, and Atlanta. But there are
major, and more unionized, cities in the Northeast,
mid-Atlantic, Midwest, and on the West Coast that the
company has to crack. Wal-Mart needs urban America. But
its progressive, labor, and small-business opponents
hope to prove that it's not mutual -- that urban
America doesn't need Wal-Mart.

Wal-Mart's predicament has the ring of an Aesopian
morality tale. The retailer's business practices have
contributed to the immiseration of the American working
class. Its relentless price pressure on manufacturers
drove even more of them overseas, and the jobs with
them. Wal-Mart's low wages and staunch opposition to
unions helped keep wages low in retail, a sector so
large it can affect the wages in other industries. As
many have noted, Wal-Mart seemed to be pursuing a kind
of reverse Fordism. While Henry Ford thought he needed
to pay workers well enough that they could buy his
products -- cars -- Wal-Mart liked to pay workers badly
enough that they could only afford to shop at Wal-Mart.
But today, Wal-Mart's own practices of reducing incomes
to poverty levels may actually be hurting the company.
Some at the UFCW wonder if now, improving the lot of
the working class is actually in Wal-Mart's
self-interest. Could Wal-Mart's interests eventually
align with labor? A massive increase in the minimum
wage, the extension of unemployment benefits -- all
these tamely social democratic measures now could
benefit Wal-Mart by giving the working poor a little
more money to spend. So might more widespread union
membership.

Restivo loves to say that Wal-Mart won in Chicago when
its approach to the community changed from
"transactional to transformational." That has a nice
ring to it. But he is not, apparently, referring to a
real transformation of the company's own management
philosophy. When I ask Restivo if allowing union
organizing at Wal-Mart might actually be in the
company's interests, he insists that Wal-Mart employees
have always "chosen" to reject union representation.

Wal-Mart has a curious idea of "choice," judging from
the stories of former employees like Kenneth James, a
former Wal-Mart associate of the month, who gave
testimony at the New York City Council hearing. After
James tried talking to his co-workers about their union
rights, he says his weekly hours were cut from 40 to
18. He then faced eviction and homelessness -- which he
avoided only thanks to the mercy of his landlord and by
quitting Wal-Mart in order to cash in his 401(k).

These are the realities of Wal-Mart's attitude toward
unions. But even union-busting companies sometimes
allow workers to form unions once it becomes
economically painful not to. The question is: Will
American unions ever be able to bring enough pain to
Wal-Mart?

Liza Featherstone is an independent journalist and the
author of Selling Women Short: The Landmark Battle for
Workers' Rights at Wal-Mart.

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