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  • authored by Hugh Finnamore
  • published Wed, Feb 16, 2005

The Jonquiere Closure: Wal-Mart Two or Deja Vu?

Impotent Union Turns To Lawyers For Enhanced Performance

In the war of corporate titans, Wal-Mart says it will shut its first unionized store in Jonquière, Quebec because the United Food and Commercial Workers Canada (UFCW) won't agree to a contract that will keep the store profitable. Right on cue, the puffy men of labour emerge and begin to strut and bluster.

An early salvo was fired by union lawyer Paul Cavalluzzo who indicated that the union might take Wal-Mart to court or that the UFCW might ask the government to fight its battle with Wal-Mart by ordering a contract that the impotent union is incapable of bargaining itself. If pushed, the UFCW might ask Canadians to not shop at Wal-Mart. Meanwhile, UFCW Canada top dog, Mike Fraser, promises that the Quebec Labour Board will have something to say about the dispute.

Not to be ignored, Canadian Auto Workers' Buzz Hargrove rails that, "It's a vicious anti-union position to take." Of course it is. Where in the world does he think that he'll find a company taking a pro-union position?

Mr. Hargrove reinforces the notion that lawyers, rather than the will of the worker, will win the day when he says, "I think the remedy is to go after them in court. I'd be asking the Quebec labour board to certify every store in Quebec." In saying that, Mr. Hargrove bolsters the argument that the union movement is long dead. He's admitting that unions are institutions run according to a corporate model of governance and controlled by a half-century-old system designed to meet the needs of the participating institutions-government, commerce and "corporatized" unions.

Has the strike become passé? Is this Wal-Mart two or déjà vu?

What happened in Jonquière was totally predictable. The labour guys carefully choreograph their outrage because they wanted people to believe that their plan to bargain an agreement at Wal-Mart was actually possible-despite the total lack of employee commitment. Hogwash! They knew that the store would close. Unions are put to the run regularly at Wal-Marts throughout North America. Jonquière wasn't the first Wal-Mart certification. Wal-Mart employees in Windsor, Ontario, once certified to Mr. Hargrove's union, sent him packing almost a decade ago.

The Steelworkers Union took Wal-Mart to the Ontario Labour Relations Board in 1997 and convinced the Board to certify the Windsor, Ontario store. Buzz Hargrove and his CAW took over the mess and produced a disputed contract that would have given the workers a minimum 75-cent raise on their base wage of $6.85 an hour, with an additional 50-cent increase based on merit. That disputed contract also included a grievance procedure. Within months those employees filed an action that eventually put the run to the CAW.

Organizing retail businesses like Wal-Mart is a lost cause for conventional unions. This is not becasue of the anti-union tactics of service industry employers. It's because unions like the UFCW have spent the better part of three decades giving service industry workers reasons not to join them. Pitiful contracts and extreme union-management coziness don't make unions appealing to workers. The UFCW hasn't just put itself out of the running with its shabby track record. Unions, in general, have been tarred with its reputation. And speaking of pitiful contracts:

Reports indicate that Wal-Mart actually bargained with the UFCW. Wal-Mart, no doubt, offered the UFCW a deal that was somewhere in the rate and benefit neighbourhood of the Loblaw deal. If that's the case, then the whole Jonquière mess leaves one wondering why the UFCW so stridently opposes giving Wal-Mart what it wants in a contract.

It's possible that UFCW officials actually believed Canadian Director Michael Fraser's boast in the National Post last fall when he said that "the gap in earnings between his members and Wal-Mart workers is $10 to $20 an hour." It's possible but not probable. The reality is that, thanks to a back room deal Fraser did with Loblaws in 2003, UFCW members who handle Wal-Mart-type merchandise at the new Real Canadian Superstores in Ontario have parity with Wal-Mart workers. Some earn even less than their Wal-Mart counterparts. Sadly, the Jonquière workers may have been persuaded to join the UFCW in the belief that they stood a chance of getting a whopping $10 or $20 an hour wage increase. Gains of this magnitude are rare in collective bargaining and unheard of when the union is, on other fronts, making deals that encourage competitors to race for the bottom.

When you consider that the UFCW prematurely opened a six-year contract with Loblaw Companies to give it Wal-Mart wages and benefits, and that the UFCW is getting set to do another mid-term deal with Loblaw's, you might surmise that Wal-Mart would be looking to one-up Loblaw Companies and undercut the Loblaw deals. That's what businesses do when they think a union can be persuaded to help them leverage their position in the marketplace. Give one a break and the others line up with demands of their own.

If the UFCW is committed to helping Loblaw outperform Wal-Mart in the Canadian retail market (and UFCW leaders have said as much), the UFCW is in a strategically perfect position to keep the retail playing field level for Loblaw, if not slanted in Loblaw's favour. Its previously mentioned partnership agreement with Loblaw was supposed to run to 2006. To open it in 2003, build in concessions for the workers the Superstores and close it up again, Loblaw guaranteed that it would ask for no further concessions upon its renewal in 2006. However, that agreement seems to open and close like a screen door in a hurricane. While it was bargaining with Wal-Mart in Quebec, the UFCW was offering Loblaw a deal to again reopen its contracts-apparently to help Loblaw with a tax break the company lost due to the new Canadian tax rules. Strategically, no matter what Wal-Mart agrees to, the UFCW can give the same deal or better to Loblaw. Voila! The proverbial level playing field is maintained, for the benefit of Loblaw Companies, with the help of its obliging union. Everybody wins except the workers.

Did the possible "payoffs" of organizing Wal-Marts for both Loblaws and the UFCW play a part in the UFCW/Loblaw bargaining strategy of 2003? Were the millions of dollars that Loblaw Companies agreed to quietly pay UFCW Canada and three of its local unions earmarked for organizing Wal-Mart? So far the UFCW has maintained a studied silence about the purposes of the almost $3 million its national office and locals received as part of the deal. Did no concessions in 2006 mean, no concessions in 2005? We'll see once Loblaw gets its new deal from the latest contract "reopener."

As they pound their chests in outrage, Canada's union leaders seem blissfully ignorant of the fact that while they have been busy railing against Wal-Mart, Loblaw has Wal-Martized itself with the eager participation of Canada's largest retail industry union. Indeed, thanks to the UFCW's mid-term generosity, Loblaws has been able to launch its enormous hybrid grocery-department stores in a market where it will have virtually no competition.

Perhaps the leaders have worked themselves up into such a frenzy that they haven't noticed this. Maybe that explains their obsession with "remedies" that don't have a chance of success. Surprisingly, the only option that the union strategists aren't touting is the one for which unions are most famous-strike action. Collective action in the form of a work stoppage is supposed to be the most potent tool in a union's arsenal. That's what one would expect from an "association of workers." To get a strike vote, a union needs strong member support. To actually pull off a strike, a union needs strong commitment from a significant majority of the bargaining unit involved in the bargaining impasse.

It stands to reason that if the UFCW had majority support, that they'd be picketing the heck out of the Jonquière Wal-Mart store, and they'd be hitting the bricks at their other Quebec-certified Wal-Mart stores.

Instead, when these so-called associations of workers can't garner sufficient support, they run to the government for help and order union media hacks to kick into propaganda overdrive. It's a waste of time and their current members' money because the government can't stop employers from packing up and leaving town. It doesn't have the authority. The Quebec labour board can't certify every Wal-Mart in the province (as Buzz Hargrove suggests) as punishment for the Jonquiere closure. It doesn't have the authority. As for a boycott, UFCW spin doctors have proven time and again to be notoriously ineffective at persuading anyone but themselves to do - anything.

If the union movement isn't dead, it's surely impotent. Lawyers and politicos are now the equivalent of union Viagra. The sad part is that even if you can arouse these tired vestiges of unionism. Their constituents have a headache and no longer find them attractive.

In the end, Wal-Mart isn't harmed, Loblaw isn't harmed and the UFCW isn't harmed. However, this whole stupid fiasco and its oh so predictable outcome has left 190 women and men a lot worse off than they would have been if they had been left alone by the UFCW and its $20-an-hour-raise pipe dreams. If the UFCW worked harder to maintain or even drive up the wages, job security and working conditions of their existing members then Wal-Mart workers might feel motivated to fight for what the UFCW can achieve. Why on earth would a Wal-Mart worker fight to achieve basically what she or he already has?

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