With almost no publicity outside of the Boston area, there’s a fascinating showdown taking place between grocery store workers and their corporate overlords.
Warehouse, clerical, and management employees of Market Basket have protested the firing of their CEO, Arthur T. DeMoulas, whose family started the supermarket chain that once carried his name. His crime? He was good to workers.
Let’s consider that again: Workers are protesting the firing of a corporate executive.
It’s a family feud pitting DeMoulas against his cousin. The ousted DeMoulas was a favorite among the rank-and-file. What’s unusual is the protesting employees are proving to have the power that labor once had, by enlisting the most feared weapon of all: the customer.
Since the protest started, the Boston Globe reports, Market Basket stores have been empty and competitors are doing a brisk business.
Something is resonating here with the public that has in recent years been only too happy to step over the carcasses of workers.
What’s happening is “unprecedented in modern labor history,” writes Thomas Kochan, a professor of a management at MIT’s Sloan School of Business, on WBUR’s Cognoscenti blog.
First, it demonstrates the growing frustration building among workers at all levels with short-term, self-interested owners and corporate executives who choose to line their own pockets at the expense of the workforce and their customers. In doing so, these employees are taking on the horde of Wall Street analysts who criticize companies that choose to pay employees well and build a loyal customer base rather than just maximize shareholder returns.
For years, Wall Street analysts criticized Costco and Southwest Airlines for following similar strategies, urging them to behave more like competitors such as Walmart or other airlines. Yet these companies showed consistently, over many years, that they could provide good jobs, products and services, and good profits and long-term shareholder returns by treating all stakeholders fairly and with the respect they deserve.
So the first lesson: Corporate America better wake up and start listening to their employees , or they may find themselves listening to them through bullhorns and in the national press.
Some of the employees who joined a protest last week were fired.
“Discharging workers who are supporting this action who have long seniority and clean work records, it’s going to look terrible for them,” Gary Chaison, a professor of industrial relations at Clark University in Worcester, tells the Globe. “They’re creating their own martyrs.”
After Demoulas called for the workers to be reinstated, the grocery chain only made things worse with a statement released yesterday:
“We share many of the sentiments that Arthur T. Demoulas articulated in his statement. The success of Market Basket and the loyalty of both its associates and customers is indeed the result of the dedication and hard work of thousands, from all ranks of the company. Our cashiers and store associates are as important as senior executives.
The individuals who were terminated took significant actions that harmed the company and therefore compromised Market Basket’s ability to be there for our customers. We took the difficult step of termination only after we saw no alternative. We are committed to continuing the tradition of excellence and dedication that has been built over several decades.
We strongly encourage all associates to return their focus to Market Basket’s customers, their needs and expectations. We understand the strain and emotion facing Market Basket associates. We know and understand that trust and acceptance are earned and cannot be demanded or imposed.
We are committed to earning the trust and acceptance of our associates and Market Basket’s customers and hope that our associates will judge us not on our promises, but on our actions as we move forward.”
Meanwhile, the stores’ shelves are often empty because the warehouse workers have joined in the employee protest. Every one of the chain’s 71 stores was hit with a protest rally yesterday.
Keep in mind, the employees aren’t protesting for higher wages or better benefits. They’re protesting for decent leaders, the Washington Post notes.
What would inspire such loyalty, especially in a world where CEOs are increasingly viewed as an out-of-touch group of 1 percenters and the corporate social contract feels as if it’s all but disappeared?
A CEO that has a track record of paying above-average pay and benefits, for one. But in speeches, blog posts and media reports, employees spoke of the former CEO’s integrity, accessibility and generosity. He was known for attending the weddings and funerals of employees’ families.
“He’s George Bailey,” says Tom Trainor, a 41-year veteran of the company who was a district manager of 37 stores before he was fired Sunday, comparing Arthur T. to the fictional savings-and-loan manager from the film “It’s a Wonderful Life.” “He cares more about people than he does about money.”
The protest is at a crossroad, one management expert says, because it risks “destroying the village in order to save it.”