‘Progressive’ Companies May Have a Unionization Target on Their Backs

Companies that have embraced progressive values might find an unintended consequence to that approach: It’s putting a unionization target on their backs.

At least, that’s the perception of some labor experts, who say companies perceived as progressive could soon see organizing efforts as the union movement gains the most momentum it’s had in decades.

“I think that as companies try to attract new talent in a very hot labor market—as they attempt to appeal to people by espousing what some would call ‘progressive’ values—unions are now trying to flip that on its head and argue, ‘Well, if you’re so progressive, you should be open to unionization efforts,’” said Don Schroeder, a partner at Foley & Lardner who represents Fortune 500 clients.

Some labor experts question that premise, saying organizers are well-aware that a company’s embrace of progressive causes does not necessarily translate into an openness to their workers organizing. What is beyond dispute, however, is that unionization is at an inflection point after years of decline. The public’s approval of labor unions recently reached its highest level since the 1960s, and petitions for union elections are flooding in to the National Labor Relations Board (NLRB).

The NLRB reported this month that union-representation petitions for the first half of its fiscal year reached 1,174, up 57 percent from a year earlier and the highest level in a decade. This development follows decades of declining union membership: In 2020, the percentage of working Americans who belonged to a union was 10.8 percent, and that number fell to 10.3 percent by 2021. In comparison, in 1983, the first year for which the Bureau of Labor Statistics (BLS) has comparable data, that number was 20.1 percent.

Long-simmering frustration among workers accounts for the recent uptick in labor activity, said Nick Weiner, an organizer with the Committee for Better Banks, a project of the Communications Workers of America. Weiner, who has been a labor organizer for nearly 25 years, said this buildup has been especially apparent among younger workers.

Those workers are “feeling squeezed and that the rules of the economy don’t work for them, that they can’t get ahead,” Weiner said. “Since the ‘08 financial crisis … there’s been a generation of people who graduated from college or came of age to get their first job … and then got hit with Covid.”

While unions have long existed in industries such as healthcare, education, and utilities, organizing efforts are also starting to grow in sectors that have not historically seen robust union activity, including financial services and tech.

Schroeder pointed to several examples of companies with progressive brands that have recently wrestled with unionization efforts: Starbucks; outdoor equipment and clothing retailer REI, which brands itself as a co-op that donates to nonprofits dedicated to the outdoors; and No Evil Foods, which makes meat from plants and deploys socialist language in its branding.

For years, Starbucks was lauded for policies such as paid parental leave, healthcare benefits for part-time employees, and 100 percent college tuition coverage for some workers. It now has lost unionization votes at 28 stores, and more than 200 others have filed for votes with the NLRB. Starbucks has about 9,000 company-owned stores in the United States.

No Evil Foods defeated a unionization effort in 2020, while REI lost a unionization vote at a New York City store last month. That is the only one of its approximately 170 U.S. stores to unionize so far.

John Logan, a professor of labor studies at San Francisco State University, told The New York Times that, like Starbucks, REI attracts workers who appear to have an ideological affinity for unions. “REI seems like another example of predominantly young workers who are not buying the arguments about unions being special-interest groups,” Logan told the newspaper in an email.

When workers perceive a “disjunction between the rhetoric of an entity and its behavior to its own workers, [that] can be a big motivating force for workers to unionize,” said Joshua Freeman, a professor at the City University of New York’s School of Labor and Urban Studies who has done consulting work for unions.

One example is the recent movement by attorneys at nonprofit legal defense groups in New York City, he said. Many of these attorneys “feel like: ‘We protest these values externally, [therefore] we should live by them internally,’” Freeman said.

Even so, Freeman said he doesn’t see that inconsistency as being a driving force behind the recent boom in union-election petitions. Workers seeking to organize because they believe their employer’s actions don’t line up with their stated values has not “been a big phenomenon in the history of unions,” he said.

Weiner points to a possible reason for this. Unions have always tried to identify companies that will respect their workers’ right to unionize, but “the issue is that over the years, there’s been very few of those types of companies—they’ve been hard to come by,” Weiner said. “I think what’s a little bit different recently is that there are more companies in different sectors that are seeking to distinguish themselves within their own industries by becoming sort of mission-driven companies.”

Categorizing companies as “progressive” is especially murky terrain in an era when companies of all stripes are embracing flexible work arrangements; generous paid time off policies; diversity and inclusion initiatives; and environmental, social, and governance causes, widely known as ESG.

“I’m not sure why we think of Starbucks as a progressive company. I don’t know what that means,” Freeman said. “Why are they more progressive than Ford Motor Co. or Tesla? … You could argue Amazon offers better benefits than a lot of companies, especially low-wage companies.”

And some companies that jump out as progressive actually might be least receptive to unionization because they perceive a union as adding a layer that inhibits the free flow of ideas and information between senior management and workers.

That’s been the case at Starbucks. After Howard Schultz returned as CEO this month, he declared, “I’m not an anti-union person. I am pro-Starbucks, pro-partner, pro-Starbucks culture,” Schultz said. “We didn’t get here by having a union.”

Schroeder said he agrees that unionization can create a wall between management and workers. “There are a lot of reasons why even a progressive company would not necessarily want a union, including the fact that in a progressive company one of the values or tenets that’s usually communicated is the openness of communication and the level of transparency,” he said. “With a union, everything has to go through the union, in terms of discussing wages, hours, and working conditions,” he added.

But there have been recent union victories at progressive companies. For example, Weiner helped lead a successful campaign at Oakland, California–based Beneficial State Bank, which provides financial services to under-served businesses, nonprofits, and individuals on the West Coast.

In March 2020, workers at the bank formed a union, and the bank immediately agreed to enter a neutrality agreement and voluntarily recognize the union. The workers were the first in the financial industry to win collective bargaining rights in about 40 years.

In September, staff members at nonprofit software company EveryAction announced the Washington, D.C.–based company voluntarily recognized their union.

Brian Devine, an associate director at the company who departed in December but was involved in the organizing process, said that while the unionizing was a lot of work, EveryAction was cooperative. Workers at EveryAction reached out to the CWA when they decided to unionize, Devine said.

“A lot of the [company’s] major unions are clients, and also with the Democratic Party being a major client, being pro-union is very much in line with the company’s values,” Devine said.

Though the growing number of companies embracing progressive causes hasn’t yet translated into more unionization, Weiner said, “I hope it turns out that way. Around the world, there are different models where employers are more neutral and don’t fight workers unionizing in the way they do in this country,” Weiner said. “It’s more the norm in Europe and Australia and Japan, where there’s much less opposition. I hope it’s a growing trend.”

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From: Corporate Counsel