Calling Out Whole Foods: Whole Foods Quietly Cutting Employee Free Choice
By Annie Shattuck and Zoe Brent
August 22, 2009
While Whole Foods CEO John Mackey recently publicly inflamed the health care debate, behind the scenes Whole Foods has been quietly dismantling a key piece of legislation that would make it easier for workers who want to form a union to do so.
Whole Foods and Starbucks are backing a “compromise” to strip the Employee Free Choice Act (EFCA) of a key provision. The so-called “card-check” provision would require employers to recognize its employees’ union once a majority has signed union authorization cards. Currently, employers often refuse to recognize new unions even if all their employees have signed up. New contracts often take years to negotiate, meanwhile workers are frequently subject to harassment and sometimes fired. The card-check provision is so central to this legislation, it has been called “the card-check bill.”
Food industry giants from WalMart, to meatpacking titans Smithfield, and Hormel, to McDonalds have sent out an army of lobbyists to fight the pro-union bill. WalMart has spent $10.5 million in federal PAC spending since 2000, plus contributions to other corporate front groups lobbying against the bill.
However, unlike out-and-out opponents of the legislation, Starbucks and Whole Foods have built labor friendly images by supporting fair-trade and offering better wages than some other chains, despite being aggressively anti-union. Now it appears the retailers are cashing in on that image to modify the EFCA and remain, as Mackey says, “100% union-free.”
The hypocrisy is not lost on Whole Foods’ employees - one states, people need “to know just how false their [Whole Foods’] 'socially responsible' image is, especially with regards to their own workers.”
This summer Whole Foods employees are voting on their new health benefits package – the “choices” amount to a significant cut from the previous years’ packages. Reflecting employee discontent, a recent press release comments “It takes a truly unique culture to persuade people that submission is empowerment.” They go on to allude to the need for unions to confront these cuts, saying that without “a method for organized, collective action workers can expect this promise from their employer, 'Whole Food Market reserves the right to change, revise or eliminate any of the policies and/or benefits at any time.'”
Several workers at a San Francisco Whole Foods store were fired this spring for incidents employees claim were related to their organizing efforts. An un-compromised Employee Free Choice Act would prevent that kind of retaliatory activity and provide the “method” to preserve health benefits that employees seek – but not if Whole Foods and other food giants strip the bill of it's teeth.
Though reporters have discussed the EFCA compromise as if it is a done-deal, AFL-CIO union leader Candace Lund reminds us, “reports of the death of card-check have been prematurely exaggerated . . . We don’t have a compromise, just an article [referencing one NY Times story].”
Lund’s support of the “card-check” provision is just one way unions are seeking better conditions for workers. Within the food system, organized labor has played a significant role in job quality. Research by the Institute for Women’s Policy Research indicates that unionized workers in the retail food industry make 31 percent more than their non-union counterparts. The premium is even higher for part-timers (33 percent), non-supervisory workers (45 percent), and cashiers (52 percent). Union members are also more than twice as likely get part or all of their health insurance premiums paid through their job.
Yet, unionization rates have fallen from their post World War II peak of 35%, to 26% in 1975 and today only 12% of all workers and 8% of private sector workers are unionized. This drop in union representation has come with a significant drop in wages. For example, supermarket workers’ real average earnings fell by 31% between 1978 and1996. Similarly, wages in the meatpacking sector have declined in real terms by 45% since the 1980's.
The fact that food industry giants have come out in force against the bill is indicative of something larger. Falling wages and health care coverage are trends that are recurring throughout the food system and public policy underwrites the decline - through selective enforcement of labor and anti-trust laws, but also through state welfare programs. As the food industry has become increasingly concentrated over the past two decades– cost-cutting measures have disproportionately shifted to workers whose poverty line wages are often supplemented by Medicaid, food stamps, child nutrition programs, direct government payments, and other government services.
The total estimated cost of state and federal payouts for Burger King employees alone is over $273 million a year. Multiply $273 million over all major fast food and low-wage retail food outlets, and the government is shelling out billions of dollars a year to subsidize the industry’s bottom line. According to research done by the AFL-CIO, in the company’s home state of Arkansas, Wal-Mart employees are the largest group of Medicaid recipients from any one company, accounting for 40% of the total state Medicaid budget.
One way to reverse this trend would be to make food sector jobs good jobs - by making it easier for workers who want to form a union to do so. This is why an intact Employee Free Choice Act (with majority sign-up) is crucial.
Whole Food's John Mackey is no fool – while he may have galvanized supporters of health care reform by speaking up, on the issue that will eat into his company's profit margin, he remains silently, yet powerfully active.
Annie Shattuck is a Policy Analyst at the non-profit think tank Food First/Institute for Food and Development Policy in Oakland, California. Zoe Brent, a visiting researcher at Food First, spent the last several years studying the labor movement and economics in Argentina and the U.S.