First unionized Wal-Mart - ooops!

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First the story:

Wal-Mart to close store aiming for 1st union contract

Well it seems that Wal-Mart either a. isn't too fond of unions, or b. can't make money based upon the demands of the union.

I will be going with b. Wal-Mart isn't averse to making money; so to close a store due to its just wanting to break the union doesn't really fly with me.

Here is the part are really like. If I am reading this correctly, the union leaders are going to fight Wal-Mart's decision to close the store. What are these people, ? On what basis are they going to fight? If a business is not making money and wishes to withdraw from business it is within its rights to do so. So what are they going to do? Seek damages in the courts? Ask the government to prohibit Wal-Mart's closure?

And people complain about their employers abusing them! Don't get me wrong, I am all about the rights of people to form unions and negotiate for better wages, conditions, and benefits. It is the correct way to balance the inherent power that the employer has, but when unions get to the point where they believe that they are so powerful that they get to dictate the terms under which the business operates, that is too far.

 

The union can't do anything about it. If I remember correctly Wal-Mart closed a store in Canada a couple of years ago when it looked like it was going to unionize and McDonalds has a long history of doing so. You would think that these idiots would realize by now that by attempting to unionize all they are doing is eliminating their jobs.

My favourite was the Bank of Montreal branch that unionized. The Bank kept the union members to the letter of the union contract which ended up meaning that the unionized employees
(1) did not receive any of the raises that non-unionized employees received
(2) were laid off whenever business levels dictated it was prudent to do so - non-unionized employees in the same situation were moved to other branches
etc.

No other bank branches wanted anything to do with unions after that and the union members ended up voting to decertify.

From my own personal experience in public accounting the unions that my clients' employees belonged to were nothing but a bunch of crooks. The employees were being paid just above the legal minimum wage and the unions were taking a chunk of those wages for doing absolutely nothing. The union contract didn't even address employee wages - the only thing the union seemed to care about was guaranteeing that all non-management employees must belong to the union and be required to pay their dues. I don't think a union rep. had even visited the plants in years - as long as their cheques kept flowing in they didn't care one bit about the workers they were supposed to be representing.

 

I'm curious what the demands were. They must have been extremely steep to get a store to close, most corporations would leave a branch open with even a small profit margin if only to keep their corporate presence in public view and to take away sales from their competitors.

My guess is that the projected effects of a Union victory would provoke union action in other stores, which, after a number of victories would seriously cut into their overall profit margins.

As to fighting a store closing? I'm not remotely familiar with Canadian laws governing commercial entities, but... it does sound pretty ridiculous.

 

I've thought for alomst 30 years now that most unions had long outlived their usefulness. Just look at what's happening in the American airline industry these days, and see how stiff-necked unions are driving the final nails into the coffin. They're no less greedy than the corporations they claim to be protecting their people from.

What's worse, Mr. Union President, making concessions on your demands so that a company can keep its doors open (and therefore keep paying salaries to your rank and file) or standing firm by what you see as the union's due and riding that horse all the way into bankruptcy?

You said it, Darkwolf, they're nuts.

 

Yes ArtEChoke - if one store manages to successfully unionize then others will follow. The cumulative effect on all of the other stores is invariably far greater than the profits from the one store that gets the axe. Unions are like cancer - you have to kill them before they spread.

 

A little off topic, but IMO, the need for unions is cyclical. Businesses begin to abuse employees, slowly increasing the abuses until the employees get sick of it and organize, then the employees discover that they have the upper hand and slowly take advantage until they are abusing the relationship, and then the employer discovers he can break the union because there are lots of people who are willing to do the same job for less than the union workers. We then start the cycle up again.

I believe that overall, the pendulum is just starting back from being on the union’s side, and it will probably swing all the way over until the employers are abusing the workers again before it swings back.

 

I agree with Darkwolf. I think than in general employers abuse their staff more than unions abuse their companies.

For good reading on McDonalds and Walmarts vs unions get a book called 'Fast Food Nation'. Its a very informative book but unfortunately I cannot remember the authors name.

 

Wasn't it Wal-Mart that decided to close all their butcheries when only one in one of all their shops decided to unionise?

 

I'm curious as well. But I would believe little, if anything that the fat cats at Wal-Mart say regarding the matter. I have been boycotting them for years, because of the manner in which they treat their employees. Now, I have another good reason to continue.

 

Don't get me wrong, I'm not a fan of Unions but here is an alternative explanation:

1.) Store Unionises, costing lets say 10% of that stores profits. (Still making a nice little earner in this store)
2.) Other store see's this and Unionise, better paid staff, less profits to Walmart.
3.) Continues ad-infinitum, Suddenly Walmart has lost 10% of it's total profit margin, something that is going to be well in excess of that lost by closing a single store down.

Basically, if one store unionises and the staff are better off, they all will. Unless the percentage profit lost by unionisation is less than the profit lost by closing down a store or two, guess which Wal-mart will do!

 

Carcaroth,

That is a good analysis. However I am not really convinced of the view of unionization as an infection. It would be very easy to see the causality of the spread of the unionization in a company in that manner, but it could also be explained as a common viewpoint shared by the workers of that industry or by that company.

(The following example is 6 years old things may have changed)

For example, in California, there is a strong union among grocery market workers. One of the large union stores is called Raley's. Almost all, if not all, Raley's Supermarkets in California are union, however, if you step across the border into Nevada, none of their stores are unionized. This is not just a temporary situation, where as the union has not had time to move into Nevada, it has been like this for at least 15 years that I am aware of, possibly longer.

I have to admit that even in this example there is a weakness as the employees in Nevada all receive better wages than at competing non-union stores, and the same benefits as California Raley's employees, so perhaps in a case such as Wal-Mart there would still be a desire to make sure that no unionization occurs.

That said, if Wal-Mart is mistreating its employees so badly, those employees will move on to other jobs, forcing Wal-Mart to raise the working standards, or Wal-Mart will continue to face increasing efforts by their workers to organize.

Love 'em or hate 'em, Wal-Mart is always an interesting topic!

 

Here you go

I guess the union failed to show how hiring the additional 30 people and giving people more hours was going to improve the profits of the store.

 

Is this sarcasm? I hope so. Actually, it seems like the onus should be on the union to prove that an additional 30 people are required for the store to run efficiently. It seems like if you hire 30 more people and increase every one else's hours, that the store was horrificly short-staffed prior to this.

 

From TGS' link. Hmmmm....smells like dead fish...

Kind of like Wal-Mart. It seems it is spreading all over. Here in Texas they are in and out of trouble with the Texas Attorney General's Office. Whenever they are in court for their criminal practices they claim Texas law doesn't apply to them because they are an Arkansas company. Too bad they won't stay in Arkansas.

 

Sometimes I am more happy than usual to live in Sweden. We have extremely strong unions without them being nearly as corrupt as the US is depicted as being. I remember when Toys R'us started to move into the Swedish market, opening a bunch of warehouses. They tried to keep out the unions and at first refused to deal with any unions. Man did they get a rude awakening. Every single warehouse was put under quaraintaine, Toys R'us entire infrastructure was completely blocked. No deliveries, no workers, no nothing. Finally Toys R'us relented and now they are doing quite fine on the Swedish market despite them being forced to deal with the union.

 

The problem is that Wal-Mart is closing that particular shop because it deems the union's demands to be excessive and thus making the operating of the business unprofitable. If the shop were a separate company, I wouldn't oppose its right to close. However, Wal-Mart is a big corporation and the employers who are to be laid off should be given a job equal to what they have now.

However, if the employers want better conditions and refuse to work unless the conditions improve (supposing the conditions meet the demands of the law), the company should have the right to close the shop and hold the employees to their own choice. No one has the right to have things his way and a job contract takes two parties. Still, those employees who belong to the (supposed) minority that still want to work for Wal-Mart should not be laid off at the company's whim.

This is what I see as the fair solution.

Yet another problem is that employees like blaming losses on labour unions and employee rights rather than their own policies and strategies. It is also to be expected that they will prefer not to have to deal with unions, as in what joacqin said above. I don't think they should be allowed to be. As I said before, no one has the right to have things his way.

 

@Aldeth

Sarcasm all the way.

Assuming you can trust Wal-Mart and that the store was only marginally profitable, then obviously adding more employees and hours and therefore increasing payroll would eliminate any profit. I however, being in the accounting profession, can think of many reasons why the books of one store do not properly reflect the gains or losses of a company. Plus, I tend not to believe a thing that Wal-Mart says.

 

Thankfully I've never had to deal with unions, so I keep all my wages. In New Zealand we're lucky enough (if you can speak English well) to being able to trust employers to not screw us over.

I guess I'm helping myself studying a BCOM which involves Employment Relations. Knowing what you're entitled to is enough, you don't need a union to fight your battles for you.