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Tuesday, October 25, 2022

Strategic CSR - Trade unions

The article in the url below focuses on the recent increase in unionization in the U.S. It also explains why, this time, it is different than in previous eras of stronger labor rights:

"Christian Smalls and Jaz Brisack have lived very different lives. Mr Smalls started out as a rapper and worked in a series of jobs in retail before joining Amazon as a warehouse picker in 2015. He was fired in 2020 for leading a staff walkout, and he went on to found the Amazon Labour Union (ALU). Ms Brisack won a Rhodes scholarship to the University of Oxford, then moved to Buffalo, New York, to work on a union campaign, but soon took a job at Starbucks. Eight months later she helped to found Starbucks Workers United (SBWU). Despite their different routes, Mr Smalls and Ms Brisack are the faces of America's changing labour movement."

Specifically, the unions these advocates are creating are specific to a single company, rather than being industry-wide. That is, the union for Amazon workers is called the "Amazon Labour Union," while the union for Starbucks workers is called "Starbucks Workers United." Both are making headway, although the ALU less so than SBWU, which is also now facing a coordinated backlash from Howard Schultz in his return to the company:

"Their names tell the story. Older unions have often had long names that describe their sectors – sometimes a mouthful (such as the Paper, Allied-Industrial, Chemical and Energy Workers International Union). This reflected their ambition. They wanted to win collective agreements covering all workers in an industry, to drive up wages and improve conditions across the board. But new unions are shunning complex monikers and using company names instead, such as Target Workers Unite (founded in 2018)."

This seems like a good approach on the part of these latent organizations. Having grown up in Britain in the 1980s with Margaret Thatcher as the Prime Minister, I have the idea of 'corrupt' labor unions running an industry into the ground (specifically the coal miners, but also other industries, such as steel or ship-building – all industries that used to be central to the UK economy). Similar patterns emerged in the automobile industry here in the U.S. In spite of this, since I also believe that a firm's employees are its most important stakeholder, the idea of an avenue of communication between management and workforce is essential. My instinct is that such 'worker councils' would be location based (i.e., a specific factory or workplace), but for firms with many locations, this emerging trend seems like a reasonable compromise:

"However it is not plain sailing. On May 2nd Amazon workers at LDJ5 warehouse, in New York, voted against forming a union. And the SWBU may have unionized 80 cafes but there are some 15,500 Starbucks outlets in America."

None of this is to say I support the unionization efforts, and Schultz's response at Starbucks suggests their efforts may win advances for their non-unionized co-workers, while not receiving those gains themselves. Ideally, in a world where management values employees, and employees appreciate the gains they are granted (perhaps, the way that Starbucks used to be), a union should be unnecessary. In those companies where employees are taken-for-granted (Amazon and perhaps the Starbucks of recent years), such unionization efforts are a good example of employees acting to hold management to account. In short, if management wants to avoid unions, they need to demonstrate that employees are the firm's most important stakeholders, and back it up with meaningful action.

Take care
David

David Chandler
© Sage Publications, 2023

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