Reference no: EM13903648

Case study - Wall Mart

In 2006, Walmart was operating more than 6,500 stores with 1.8 milion employees around the world. In the early 1990s, Walmart Stores Inc. expanded into Canada, with the purchase of 122 stores from the failing Woolco chain. Walmart had refused to purchase nine Woolco stores that were unionized.

Walmart tries to distinguish itselffrom other retailers by its culture. For example, it calls its workers "associates," not employees. Every day at 8:45 a.m., a compulsory meeting is held at each store during which company managers share financial information and performance targets and respond to questions. The meeting ends with the Walmart cheer. The company operates an open-door policy, whereby any employee can talk to any member of management about issues and receive answers without being threatened with reprisal. The sundown rule ensures that management responds to the questions before sundown the same day.

The first Walmart store ever to be unionized was in Windsor, Ontario, where the United Steelworkers (Retail and Wholesale Division) was certified by the Ontario Labour Relations Board (OLRB). On April 14, 1997, the United Steelworkers began its organizing drive. On April 26, the store manager became aware that associates were being approached to sign unionization cards. The district manager was told of the organizing drive and the next morning attended the morning meeting. The district manager asked the associates why they
would want to join a union and spent the day circulating through the store to discuss their problems or concerns. By April 27, 84 associates had signed cards. On April 29, an associate asked to speak at the morning meeting and there expressed her opposition to the union, ending with the statement, "A union will only cause discontentment in our store, and I assure you as I am standing here, Walmart will not put up with it." (Management did not ask, nor did the associate reveal, why she wanted to speak.) An inside organizer was prevented from responding because it was 9 a.m. and customers were waiting to enter the store. Between May 4 and May 9, Walmart managers-including managers from outside the store responded to questions placed in a question-and-answer box and to those raised while they wandered about the store. Most of the ques-tionsfocused on compensation and hours ofwork. However, questions were also raised about whether Walmart would close the store and dis-miss the employees if the union was successful.
Walmart answered that "it would be inappropriate for our company to comment on what it will or will not do if the store is unionized." It repeated that line when employees asked the same question in person. One associate testified that one manager said that things would change if the employees were unionized-for example, the profit-sharing plan would be revoked. On May 9, the union lost the vote, with 151 employees voting against it and 43 voting for it.

The OLRB nonetheless certified the union because the employer violated the LabourRelations Act by not disassociating itselffrom the remarks made by the associate at the meeting; by not allowing the inside organizer to respond; by soliciting questions about the impact of unionization but then refusing to tell employees that they would not all be fired if the union won; and by using senior outside managers to engage employees in frequent and repetitive discussions about the unionization drive in the days leading up to the vote. The OLRB stated that the union had 84 cards signed before the managers' visits, and a week later, this support had dropped. A second vote would not change the outcome because the threat to job security could not be erased from employees' minds. After Walmart's illegal conduct was remedied by a certification order, the Ontario government changed the law to take away that remedial option from the labour board. However, the right to certify a union as a remedy for unfairlabour practices has once again been restored in Ontario and exists in other Canadian jurisdictions.Despite numerous organizing drives, Walmart continues to try to be union free. The UFCW charged Walmart with unfair labour practices in thwarting a union organizing drive in British Columbia by discrediting the key organizer and by advising employees that if he turned up at their homes, they could call the police. The B.C. LabourBoard said, "Walmart has an anti-union history .... and simply cannot resist the temptation to get involved in certification campaigns. While Walmarthas tended not to repeat its mistakes, there is no shortage of new ones that it finds ways to make." In the company's view, not being able to answer
employee concerns about unionization is not part of its culture of open communication. But two labour relations boards believe that the company has gone too far in communication by, for example, distributing anti-union literature at a store in Quesnel, B.C. Walmart is seeking to change labourlaws to allow it to address employee concerns.

Questions

1. What were the rights of Walmart, the employer, during these two organizing drives?

2. The certification of the first Walmart was hailed by labour as a milestone event. Why?

3. In your opinion, can Walmart remain union free indefinitely? Why or why not?

4. Should foreign companies that operate in Canada use their resources to try to weaken Canadian labourlaws or accept the legal culture of the country and comply with those laws?