‘Worker Centers’ Target Retail, Restaurant Sites for Organizing

When is a union not a union? Apparently, it’s when members say it isn’t. Yet a change in terminology can’t alter reality. Over the past several years, hundreds of organizations, known as ‘worker centers,’ have established a presence in the labor movement, targeting retail and restaurant chains for organizing and picketing. While they don’t like being called unions, for all practical purposes they operate as such. And they have the advantage of being outside the jurisdiction of labor law. At least one is a reconstituted key affiliate of the defunct radical network, the Association of Community Organizations for Reform Now (ACORN). Many are stalking horses for unions, especially the United Food and Commercial Workers (UFCW) and the Service Employees International Union (SEIU). And they’re getting results, at times even more than unions themselves are getting.

The rise of worker centers is a logical response to the relative decline of union membership. During the late Fifties about a third of all nonfarm U.S. workers belonged to a union. These were peak years for organized labor, never to be seen again. By 1990, union membership as a share of the total work force (“union density”) had fallen to 16.1 percent. It would drop further by 2000 and 2010, respectively, to 13.5 percent and 11.9 percent. The year 2012 saw an especially precipitous decline. According to the U.S. Bureau of Labor Statistics, employers added a net of two million jobs to the economy over the previous year, yet unions lost nearly 400,000 members. As a result, union density reached a post-World War II low of 11.3 percent. Private-sector membership fell to 6.6 percent, down from 6.9 percent in 2011; public-sector membership was 35.9 percent, down from 37.0 percent.

There are any number of reasons behind this decline, some related to the nature of modern unionism and others related to the larger economy. Yet it is reasonable to suggest that a sizable portion, especially during 2011-12, is the result of would-be union members preferring to become worker center activists instead. Center leaders typically disavow the term “unions,” but for the most part, it’s a distinction without a difference. For what strengthens one, strengthens the other. And they frequently act in concert. From their standpoint, it makes sense. All unions have a natural inclination to expand their ranks. More members mean more dues payments and an enhanced ability to organize, bargain, demonstrate and lobby. The problem is that such goals have had very limited success lately altering existing federal labor law, most of all, the National Labor Relations Act (NLRA) and the Labor-Management Reporting and Disclosure Act (LMRDA). Particularly galling to union leaders has been the unwillingness of Congress to enact a “card check” law. Such legislation would force private-sector employers to recognize a given union as a collective bargaining agent if onsite organizers can persuade at least half of affected workers to sign a card indicating a desire to join. In response, labor organizers have gotten creative, if not necessarily ethical – thus, the worker center.

Worker centers actually have been around for a few decades. But only recently has organized labor formed alliances with them. In 1992, there were only five centers in the country. The figure today, according to best estimates, is at least 200. These organizations tend to concentrate their organizing on immigrant and/or transient work forces, as they are more difficult to organize than other workers. The centers thus can achieve union goals without being circumscribed by laws that govern unions. It’s a low-cost, non-bureaucratic win-win arrangement for ecumenical Leftism. And often employing guerrilla tactics, activists have the capacity to steer workers into unions. Labor officials, in turn, know a good thing when they see one. That’s why they are willing to play a deceptively background role.

Activists in worker centers, unlike those in unions, typically don’t know workplace managers on a first-name basis. So how do they gain entrée to a nonunion site? Typically, they do it by sponsoring off-premises “seminars” and “training.” Through such events, they can gauge worker views on wages, benefits, working conditions, promotion practices and other potential areas of dissatisfaction. These seminars often serve as a prelude to a shakedown, explains Joe Kefauver, managing partner of the Orlando, Fla.-based public relations firm, Parquet Public Affairs:

If the (worker center) organizer thinks that there might be a pattern of anti-employee policies, they piece together anecdotal information from employees and present the employer with a “bill” for perceived back wages, overtime, etc., payable of course to the worker center itself. If the employer pays or “settles,” the organizers then brand him a “white hat employer” and publicly commend him or her for the responsible businesses they operate. If sanity prevails and the employer refuses to pay, the group resorts to the standard union playbook of demonstrations, protests, reputation smearing, harassment, lawsuits and other notable public attacks in hopes the employer will eventually succumb. This is reminiscent of the stereotypical mob-run fire insurance scams.

Such tactics are also reminiscent of the now-disbanded ACORN. So it’s hardly a surprise that one of the more prominent worker centers, New York Communities for Change (NYCC), is in fact ACORN’s New York City chapter operating under a new name. National Legal and Policy Center noted the cosmetic change a few years ago. NYCC has orchestrated a number of employee walkouts at nonunion work sites. By encouraging employees to skip work and join a protest in support of representational picketing, the group fulfills a union role.

This ability of worker centers to assume union roles while circumventing union law is what makes them so effective. Even worker center leaders admit as much. Several years ago, Saru Jayaraman, a Brooklyn College political scientist and co-founder/executive director of the New York City-based Restaurant Opportunities Centers United (ROC), which is closely aligned with the hotel and restaurant union, UNITE HERE, remarked that one of the main benefits of not being classified as a labor organization is the group’s ability to avoid the formal rules under which unions operate. She noted that worker centers don’t have to spent time and money arbitrating worker grievances because, unlike unions, they don’t owe a duty of fair representation. Worker centers also aren’t explicitly subject to NLRA restrictions on on-site picketing.

Worker centers see great inroads to be made in the retail sector. It was almost inevitable, therefore, that they would turn their energies to organizing at Wal-Mart. The Bentonville, Ark.-based nonunion retailer is the nation’s largest private-sector employer. It has about 1.4 million workers at its 4,600 U.S. stores, not even including another nearly 800,000 in other countries. The company now generates total annual revenues of more than $450 billion. A growing number of Wal-Mart employees, especially longtime ones, believe they deserve a larger portion of that. Toward that end, they’ve created Organization United for Respect at Walmart, or simply, OUR Walmart. The group now claims at least 4,000 members. And it’s planning on making that number go a lot higher.

OUR Walmart’s website declares: “We envision a future in which our company treats us, the Associates of Walmart, with respect and dignity. We envision a world in where we succeed in our careers, our company succeeds in business, our customers receive great service and value, and Walmart and Associates share all of these goals.” It’s hard to imagine anyone getting up in arms over such language. But the group also has put forth a program that resembles a union wish list. In June 2011, a couple of weeks after the annual company shareholder meeting, a group of about 100 OUR Walmart members arrived at Bentonville headquarters to present senior management with a “Declaration of Respect.” The declaration called upon management to:

Listen to us, the Associates.

Have respect for the individual.

Recognize freedom of association and freedom of speech.

Fix the Open Door policy.

Pay a minimum of $13/hour and make full-time jobs available for Americans who want them.

Create dependable, predictable work schedules.

Provide affordable healthcare.

Provide every Associate with a policy manual, ensure equal enforcement of policy and no discrimination, and give every Associate equal opportunity to succeed and advance his or her career

Provide wages and benefits that ensure that no Associate has to rely on government assistance.

The list, certainly its first four items, looks reasonable. But the latter elements suggest a strong desire to apply union-driven municipal and county ‘living wage’ ordinances (of which dozens have been enacted since the mid-Nineties) to the private sector. And compliance wouldn’t be cheap. An employee floor wage of $13 an hour would be about 80 percent higher than the current federal minimum of $7.25 an hour. With no corresponding concessions from employees to boost productivity, many outlets would be forced to cut staff sizes, bonus pools or vacation time. As for the call to end “discrimination,” this was a not-so-subtle reference to a then-pending ruling by the U.S. Supreme Court in June 2011 (Wal-Mart Stores, Inc. v. Dukes) that in fact was handed down only days after the visit. The Supreme Court overruled a Ninth Circuit Court of Appeals grant of class-action status to about 1.6 million female plaintiffs in a sex discrimination case – unanimously against class certification in present form and 5-4 against all female employees having the legal standing to sue.

OUR Wal-Mart insists their goal isn’t to unionize or acquire collective bargaining rights, but rather to make the company a better place to work and shop. Yet the group does charge members $5 in monthly dues. And the 2011 trip to headquarters was paid for by the United Food and Commercial Workers, which has been trying for over a decade, so far unsuccessfully, to unionize the Wal-Mart work force. The union also has vowed to aid OUR Walmart in reviewing more than 100 cases of alleged violations of employee rights.

Even if OUR Walmart wants to stay above union politics, it may find that doing so will be exceedingly difficult. Last November, several days before “Black Friday” (i.e., the day after Thanksgiving, typically the busiest shopping day of the year), the company filed an unfair labor practices complaint against the group and the UFCW with the National Labor Relations Board (NLRB). The retailer charged that the two entities violated labor law by organizing prolonged nationwide protests over alleged retaliation for worker complaints concerning Black Friday scheduling and working conditions. Activists from each organization tried to stage a mass walkout. Less than one-tenth of 1 percent of the company’s U.S. work force wound up participating. The demonstrations, said the company, disrupted business and violated the NLRA, which among things, bars a nonunion group from picketing a given work site for more than 30 days unless it first files a petition to form a union. Wal-Mart also sought an injunction to stop planned Black Friday demonstrations at selected store sites. OUR Walmart promptly countersued, claiming that the 30-day rule doesn’t apply to persons protesting against employer retaliation. The countersuit also stated that Wal-Mart management illegally had tried to deter employees from participating in protests. Each side wanted a ruling by Black Friday, but a spokesperson for the NLRB responded that the issue was too complex to resolve in so short a time.

As it turned out, management and labor reached a settlement on their own. The NLRB general counsel’s office ruled on January 31 deciding the merits of the case wouldn’t be necessary so long as the union and OUR Wal-Mart abided by the terms of the agreement over the following six months. The union vowed that it has no interest in “forcing or requiring Walmart to recognize or bargain with UFCW or OUR Walmart as the representative of its employees.” Specifically, the union and OUR Walmart stated they will: 1) stop all unlawful picketing to obtain formal collective bargaining recognition; 2) stop encouraging unlawful disruptions by nearly 30 affiliated groups; and 3) stop all picketing and confrontational conduct at Wal-Mart stores and other facilities for at least 60 days. By any reasonable assessment, it was a victory for management.

Wal-Mart, for its part, denies that it mistreats employees. David Tovar, the company’s vice-president for communications, insists that human resource teams are available to talk directly to associates in any store in the country and that every issue is on the table. Moreover, he says, the company has a lower turnover rate than discount store chain competitors and a higher share of employees on the full-time payroll. More than 250,000 associates, in fact, have been with the company for more than 10 years. Wal-Mart, like many companies, also prefers promoting from within; about 75 percent of current store managers started out as hourly associates. “The suggestion that the issues OUR Walmart is raising are widespread or representative of any sizable number of associates is ludicrous,” says Tovar. “We know this because we have hard data. And we know this because our managers and executives are in our stores every day asking associates questions.”

Wal-Mart CEO Mike Duke insists employee relations are sound. This past December in an interview with Bloomberg Businessweek, he said: “The characterization (of negative relations) is not always accurate. This tension for me is not a tension.” The company already had amassed a track record of accommodating its critics on the Left. During the middle of the last decade, then-CEO H. Lee Scott, following a critical report by the McKinsey & Co. consulting firm, launched an image makeover, as NLPC at the time had reported (see pdf). The seeming urgency of the situation was heightened by the launch by SEIU and UFCW of corporate campaigns, respectively, known as Wal-Mart Watch and Wake Up Wal-Mart. “The Wal-Marting of the economy is a threat to every union,” said then-SEIU President Andrew Stern. Wal-Mart reduced waste and energy use at its stores; pressured suppliers to do likewise; offered more generous health plans; and hired veteran Democratic Party strategist Leslie Dach to coordinate the outreach. The company even endorsed President Obama’s health care overhaul before it became law. Apparently, OUR Walmart isn’t impressed. As group member Cindy Murray, a longtime employee in Laurel, Md., recently put it: “”I’m pretty sure Bentonville knows that we’re here to stay. I’m not going anywhere. I’m not backing down.”

Other retailers can expect to feel the heat from labor center activists. The Retail Action Project (RAP), based in Manhattan with chapters in several cities across the U.S., is a big reason why. Founded as a community group in 2005, the group quickly became a workers advocacy group specializing in issues advocacy and direct confrontation. The group is virtually an adjunct of the Retail, Wholesale and Department Store Union (RWDSU), which in turn is an affiliate of the United Food and Commercial Workers. Indeed, the RWDSU cites the Retail Action Project as a union campaign on its website. RAP has had its triumphs, too. In 2006, the group, having received wage and overtime complaints from several employees, initiated a campaign against Yellow Rat Bastard, a New York City-based clothing chain. The group’s hard-edged picketing and legal tactics led to a 2008 settlement announced by the New York State Attorney General’s Office, in which the company agreed to award workers $1.4 million. And in 2012, the group again played a central role in a New York Attorney General’s Office wage theft settlement, this time for $950,000 on behalf of more than a hundred current and former employees of the Mystique Boutique retail chain.

The restaurant industry is another area in which worker centers have made substantial inroads. Typically, restaurant workers, especially at fast food chains such as McDonald’s, Taco Bell and Wendy’s, have high turnover rates. Many, in addition, are transient immigrants from Third World countries. While such traits make them difficult to organize, the aforementioned Restaurant Opportunities Centers United (ROC), founded in the wake of the 9/11 attacks to support displaced restaurant workers, is making a game effort. The group, with 17 locations across the U.S. comprising about 10,000 members, specializes in staging protests outside restaurants in the Chicago, New York, Washington, D.C. and other areas. Celebrity chef Mario Batali was so incensed at the group’s in-your-face harassment against his customers that he sought a court order back in November 2010 to bar members from protesting outside his establishments.

But the UNITE HERE-affiliated ROC knows a thing or two about using the legal system to its advantage. By the end of 2011, the group already had bagged a combined $5 million or more in settlements as a result of complaints against relatively small restaurant chains. Early last year it went after big game in the form of the Orlando, Fla.-based Darden Restaurants, parent company of the Olive Garden, Red Lobster and other brand names. With roughly 170,000 full- and part-time employees, Darden makes for a target-rich environment. ROC alleged in a federal lawsuit that Darden forced more than two dozen workers at its upscale Capital Grille chain to work “off the clock” before or after scheduled shifts and to share tips with non-tipped employees. A Darden spokesman describes the charges as “baseless.” That said, says H.G. Parsa, a professor at the University of South Florida’s College of Hospitality and Technology Leadership, the outcome of this suit will be watched throughout the industry. He explains: “This is a test for the whole restaurant industry. Darden is…a guinea pig.” It could become an expensive one, too, because ROC is seeking to win class-action status. Already, this past September, the Miami-based litigation shop of Higer Lichter & Givner and two other law firms filed a proposed class-action lawsuit against all Darden-owned restaurant chains alleging the company paid below-minimum wages and forced employees to work off the clock. The suit seeks to represent “at least thousands” of current and former Darden employees from 2009 to the present.

ROC is cranking up the action in other areas. It now publishes an annual guide for “ethical eating.” It has published a series of reports, “Behind the Kitchen Door,” which evaluates industry labor conditions in various metropolitan markets. It pressures Congress to raise the minimum wage. And it cultivates close working relationships with federal and state officials. In November 2011, for example, ROC’s Saru Jayaraman stood shoulder to shoulder with Labor Secretary Hilda Solis and other persons at a Department of Labor briefing titled “Gender Pay Equity for Low-Wage Women Restaurant Workers.” Not long after, the group entered into a formal alliance with the Occupational Safety and Health Administration in which ROC was deputized to serve as OSHA’s “eyes and ears” and to report workplace violations.

ROC isn’t the only worker center to explore opportunities in the restaurant industry. Our old ACORN friend, New York Communities for Change, is partnering with the Service Employees International Union, the Workers Organizing Committee (which grew out of a joint project of ACORN and Work Experience Program, or WEP), the Black Institute (founded and headed by former ACORN President Bertha Lewis) and UnitedNY.org in a campaign called Fast Food Forward. The SEIU-directed group has hired 40 full-time persons to organize workers at McDonald’s, Domino’s, Wendy’s and other New York City fast-food outlets. The group’s modus operandi is targeting outlets for an employee walkout. Fast Food Forward seeks a minimum industry wage of $15 an hour and union recognition for workers. “The fast food industry employs tens of thousands of workers in New York and pays them poverty wages,” says Jonathan Westin, organizing director for New York Communities for Change. “A lot of them can’t afford to get by. A lot have to rely on public assistance, and taxpayers are often footing the bill because these companies are not paying a living wage.” McDonald’s, for one, has responded to such statements that it is willing to discuss any and all issues of employee compensation.

The question by now ought to arise: Are worker centers operating legally? That is, if these organizations perform union functions and work closely with unions as well, why shouldn’t they make it official and become unions? In an article published last fall, Stefan Marculewicz and Jennifer Thomas, attorneys with the Washington, D.C. office of the San Francisco law firm of Littler Mendelson, asked just this question. They concluded that worker centers, in seeking to negotiate hours, wages, benefits and working conditions, already are de facto unions. The overriding reason for federal labor law, they emphasized, is to make organizers accountable to the people they purport to represent:

(I)f such organizations are to represent workers in their dealings with employers, they should also be held accountable to their membership in the same way as a traditional labor organization. Any inconvenience to the worker center movement is outweighed by the benefit to the members they serve. In short, once a worker center crosses the threshold into addressing the terms and conditions of employment of their members, the institutional interests of the organizations should necessarily give way to the interests of the employees themselves. Legislation that currently exists, such as the NLRA and LMRDA, provide protections for employees, and worker centers, just like traditional labor unions, should be governed by these laws.

One of the main stumbling blocks to fostering such accountability, and arguably the least-spoken of, is mass immigration from developing nations. For it is a fact: The workers corralled by the activists, especially in the cities, are heavily first-generation nonwhite newcomers. These employees tend to lack education, literacy and fluency in English. They are willing to work for significantly lower wages and benefits than are native-born workers. And many are here in this country illegally and thus avoid interacting with authorities at any level of government. Employers and/or their contractors, knowing this, exploit them. In 2003, federal agents from the Bureau of Immigration and Customs Enforcement (ICE), in a sweep called Operation Rollback, arrested about 250 suspected illegal immigrants from contract cleaning crews at more than 60 Wal-Mart stores around the U.S. and executed a search warrant at company headquarters. Wal-Mart officials eventually settled with the government for $11 million and agreed to improve its oversight of contractors. And Chipotle Mexican Grill Inc. in December 2010, in the wake of bad publicity generated by an ICE audit of I-9 forms at several dozen of its Minnesota restaurants, fired about 450 illegal immigrants. In February 2011, ICE expanded its audit to Washington, D.C. and Virginia, which resulted in another 40 firings. Many observers believe the Denver-based chain, with more than 1,000 outlets nationwide, knowingly had hired these persons because illegal immigrants typically provide fake documents to verify work eligibility.

The sad thing is that many immigrant workers are being exploited. That’s why worker centers, though highly misguided, are focusing so much attention on them. These employees are at once the bottom of the labor market and difficult to organize in the context of traditional unionism. Marculewicz and Thomas explain:

Immigrant workers frequently find work in the service and agricultural sectors, which often are low-level and temporary. Traditional labor unions have tended not to pursue these populations because they can be difficult to organize and the work environments do not lend themselves to union organizing in the traditional sense. As a result, many worker centers serve workers who do not work in any stable workplace, such as day laborers, while other worker centers serve workers of a particular ethnic group, occupation or community without regard to any particular employer. At least one prominent worker center is dedicated to the employees of a single employer.

If worker center and allied unions activists grasped how labor markets work, they would understand that a large influx of low-skilled, poorly assimilated workers from foreign countries depresses wages for entry-level native-born workers, not to mention adds to the demand for taxpayer-funded public assistance. In many instances, such workers replace the native-born outright. It has become quite common, for example, for restaurants in many areas of this country to hire only people who can speak Spanish.

Unfortunately, unions, ethnic capos and businesses in search of cheap labor have formed an effective political triumvirate to block efforts at immigration restriction or tougher border and interior enforcement. And they support amnesty for persons illegally here. Back in 2006 I wrote a Special Report for National Legal and Policy Center (see pdf) explaining the nature and consequences of this alliance. The role of unions is particularly lamentable because until about 20 to 25 years ago they openly opposed high levels of immigration. This is supreme irony: Unions and their low-budget “worker center” partners unwittingly have created many of the very workplace injustices they seek to combat. The general public is bearing a high cost of this obtuseness to reality.


ACORN Local Chapters Declare Independence; Makeover Appears Cosmetic

SEIU Disavows ACORN, but Long History of Ties Won’t Go Away

Wal-Mart Embraces Controversial Causes: Bid to Appease Liberal Interest Groups Will Likely Fail, Hurt Business

Why Unions Promote Mass Immigration: Behind Organized Labor’s Interest-Group Alliances