Whole Foods Market Faces Another Union Demonstration In November

Posted: Nov 9 2014, 5:11pm CST | by , in News | Latest Business News


Whole Foods Market Faces Another Union Demonstration in November
Photo Credit: Getty Images

Employees at a San Francisco Whole Foods Market are looking to let their union stand and willing to walk out on November 14 if their demands aren't met. CEO John Mackey prefers to believe the business is "beyond unions."

A Whole Foods store located in San Francisco is pushing for accepted unionization due to the salary costs.

In a national press release, the Whole Food Market workers have joined with the Industrial Workers of the World in order to earn what they consider a living wage. According to their stats as reported by IndyBay, even with the state-wide $5 raise set to start in 2015, the workers will still make less than half of what is considered a living wage in the city ($29.83). So the workers would like prefer another $5 an hour, still under the living wage amount but better than less-than-half.

In February 2013, co-CEO John Mackey spoke with Yahoo's Daily Ticker, claiming the store isn't anti-union. However, those reading articles and op-ed pieces may find that hard to believe. To start with, the company hands out pamphlets titled "Beyond Unions" to cities where unions are prevalent.

"Our team members are not being prevented from joining unions, they’ve chosen not to." Aside from the pamphlets, which is a known ploy by many business who do not see a monetary benefit of a union.

"Why would they want to join a union? Whole Foods has been one of [FORTUNE’S] 100 best companies to work for the last 16 years. We’re not so much anti-union as beyond unions."

"Beyond unions" may be a nice slogan, but the company's prices on products suggests the money must be going somewhere and the workers believe it's going directly to the executive and management pockets. And trying to survive on half wage needed in a very expensive city may be a hard pill to swallow since the workers receive little to no benefits, either.

2014 hasn't been particularly kind to stockholders, but the group is earning pay-offs once again. And employees notice the increased sales and money. As do the customers. Large money investors aren't the only ones with money to spend. Local money from within the community keeps stores open. Employees represent both sections.

Supermarket News spoke with Kate Wendt, senior analyst with Wells Fargo Securities in San Francisco, about the high cost of food at Whole Foods Market locations when the grocer rolled out lower prices in 5 of its Texas stores.

"Price is still a significant barrier in the way people look at Whole Foods, and it will take awhile to change the ‘Whole Paycheck’ perception the company has." She adds the benefits of a long-term program. "But lowering prices in perishables — the category where people shop most frequently at Whole Foods — could help accelerate a change in that perception."

Wendt notes the importance of perishable versus non-perishable for the company's image.

"The chain prides itself as a unionless utopia where employees are team members empowered to solve problems. Because it's a progressive company, it views unions as a sign the company isn't providing employees with all that they need."

"Consumers tend to shop for perishables several times a week at Whole Foods, so the thinking is, they might notice the price changes faster there than they would in non-perishables — and perishables is also the section of the store where competitors like Sprouts and Natural Grocers are priced more favorably, so it’s not a surprise that’s where Whole Foods would lower prices."

However, it must be acknowledged that lowering the costs would not considerably lower the company's profits, nor would it necessitate a need to banish unions.

Historically, unions offer workers a person to represent them in case of any dispute and benefits like health insurance, a contentious topic in the United States right now. Reagan's union-busting methods caused a bit of internal confusion as "Reagan often argued that private sector workers’ rights to organize were fundamental in a democracy." The bravado broke the backbone of the American model, namely the middle class. And when in charge of the Screen Actors Guild, "Reagan led the actors’ strike in 1952," which dropped dramatically to less than 2% by 2010.

And WF Market has maintained a union-free business model since opening the first store in 1996. In a 2003 New York Times article, Jennifer Chatman, a professor of management at the University of California at Berkeley, spoke on the company culture.

Chatman noted the problem in the unionless utopia ideology and the progressive business model.

"If you look beyond the immediate financial implications, there's a real identity issue here,” especially as the employees do not make enough to even shop at San Francisco location when compared to prohibitive costs. And that lack of corporate awareness of employee impact seems to be roosting at the moment.

Back in 2003, the New York Times noted that "unlike union stores, however, where raises are given by seniority, pay increases are disbursed more subjectively" and often new employees made more than senior ones. Whole Foods Market employees in the flagship Madison store voted to unionize with a 65 to 54 person vote in that July, Mackey said it was "a very sad chapter in the history of Whole Foods Market."

In the same memo, he cited that "Madison made a mistake in their choice. It may take time for them to realize it, but I believe that they eventually will. We all make many mistakes in life. It is all part of our growth process because that is how we learn, that is how we grow."

Mackey closed out saying, "When confronted by great stress in life, we have but only 2 choices: 1. Contract into fear. 2. Expand into love."

Love is nice, but the current San Francisco employees may be under the assumption that love doesn't put food on the table—or a house, at that.

And after months of dragging corporate feet in the early 2000s, the Times notes that a mistake on creating a milk drink caused two the unionizing leaders to lose their jobs the next day.

"In November, two employees who were leaders in the unionization drive were fired over an incident that they say they thought was innocent enough. Ms. Rasmussen said she accidentally made a drink with soy milk rather than skim milk. Instead of pouring it down the drain, she gave it to a co-worker, Julie Thayer, to drink, they said."

The company denied any wrongdoing but the last 11 years shows a different view.

Threats of unionization is not a new problem for Whole Foods Market; however, pre-Great Recession economy was in a better position than right now. And customer consciousness wasn't quite so tuned in to plight of workers as people look at the costs for food based on affordability.

Now the company may find a stage out during the holidays a bit inconvenient—especially if IWW members stage a boycott and the public, even a small amount, joins in. After all, Whole Foods is just now recovering from a weak year's profits.

Wal-mart’s, another unionless utopian company, appeals to the masses by offering cheaper food in an economy where the previous middle class is slowly disappearing. Whole Foods has more competition to battle for consumer loyalty with markets like Trader Joe’s and Sprouts creating their own company culture for consumers looking for unique dinner options.

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