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Named Fortune’s 100 Best Companies to work for every year since 1998, Whole Foods wears an image of fairly traded produce and community service. However, its standing as the 2nd largest anti-union retailer in the U.S. beaten only by Wal-Mart shines a less than fair light on the grocery store chain. For nearly 2 decades Whole Foods CEO and co-founder John Mackey has managed to maintain his multimillionaire status while Whole Foods employees remain in the $8 – $13 hourly wage. With a turnover rate of 25% per year and an average employee span of only 4 years, most “team members” will never reap the benefits of seniority. On unionization and the possible passing of the Employee Free Choice Act John Mackey claims; ’you will see unionization sweep across the United States and set workplaces at war with each other.” Mackey adds that the proposed bill “violates a bedrock principle of American democracy.” Earlier this year in preparation for the passage of EFCA, Mackey launched an anti-union campaign within the company requiring employees to attend “Union Awareness Training” meetings. And as Mother Jones recently reported, “An internal Whole Foods document listing ‘six strategic goals for Whole Foods Market to achieve by 2013…includes a goal to remain ‘100% union-free.'”

GUEST: Sharon Smith, author of Women and Socialism and Subterranean Fire: a History of Working-Class Radicalism in the United States.

For more information, read Sharon Smith’s article at www.counterpunch.com/sharon05082009.html

Rough Transcript:

Sonali: So, your article about Whole Foods and the Mother Jones piece that I described brings attention to a corporation that many, many liberals and left-leaning individuals regularly shop at, well, perhaps because there’s not too many other options to find healthy foods. But this is something that nott too many people know about. Can you describe for us in more detail why Whole Foods is so important in the landscape of anti-union corporations in the United States?

Sharon: Well, what’s interesting is that the CEO of Whole Foods, John Mackey, has joined together with the CEO of Starbucks and also Costco and they’ve formed sort of what they call “the third way” in opposing the Employee Free Choice Act. The provisions they’ve managed to maintain, again while making it seem that they’re the kinder, gentler version of opposing EFCA, but their third way manages to keep the essence of the same priorities as the Chamber of Commerce which are to prevent card checks as an option or signing a union card and getting a majority of workers to sign a union card as an option and, also, very key, they maintain the right of management to stall which is a big part of how companies manage to bust unions is that even after a majority of workers vote in the union, if they can stall long enough, if management can keep from negotiating a successful contract with the workers for a year, then they can call for another union basically to de-certify the union and that’s another way in which management has successfully, over the last 20, 30 years, combated union organizing. So, it’s a, you know, kinder, gentler veneer to the same priorities as the Chamber of Commerce.

Sonali: Now, Whole Foods promotes a very liberal image, as I mentioned. Tell us about the lengths that it goes to to express itself as a liberal institution, a liberal corporation just in terms of its own management structure and the kind of support that it offers to non-profit groups, etc.

Sharon: Yes, well, they’ve set up a number of foundations, you know. You know, who could oppose something called the Animal Compassion Foundation? You know what I mean, which is one of their foundations. What else do they have – the Whole Planet Foundation. You know, these are certainly things that no one could find fault with. But their own management structure rejects, you know, so-called traditional corporate management models in favor of what is a de-centralized kind of teamwork. They don’t have departments at Whole Foods, you know, you don’t have a produce department. You have the produce “team” made up of the employees that, you know, apparently have a stake in the success of their department and meet regularly to decide how they can be more productive as team members. And, they don’t have managers, they have team leaders and so on and so forth.

Sonali: So, do they do decision-making with consensus on how to run the store?

Sharon: They aim for consensus at, you know, things like, your produce department, you know, I’m a team member, I get to vote on which supplier we’re going to use to get our tomatoes, that sort of thing. And also, when people get hired by Whole Foods, at first they have the standard probation period, which of course, other companies have but then the team has to vote and achieve a two-thirds majority to decide whether that employee will be hired as a permanent member of the staff. So, it’s, you know, it’s promoted as a sort of experiment in workplace democracy, if you will, but it actually is pretty standard and, you know, the thing that distinguishes Whole Foods, which has a profit margin, by the way, which is much higher than more traditional grocery stores which tend to have like a 1% profit margin. Whole Foods has traditionally had a 3% profit margin.

Sonali: Well, I mean, you pick up a quart of milk and you can tell by its price. They’ve got a ridiculous profit margin. I mean the standard joke among people who shop at Whole Foods, reluctantly, is that it should be renamed “Whole Paycheck”, right?

Sharon: Exactly. But they also combine their, you know, extremely high prices with quite standard low wages so that adds to the profit margin.

Sonali: So, it’s got this sort of semi-democratic or pseudo-democratic workplace – you, know, the way in which workers interact with one another is, in a way, democratic and even decision-making on, as you said, which supplier to use – but the main power that a union brings to a workplace is deciding on wages and benefits. That’s what they lack.

Sharon: Exactly. And, you know, from top to bottom, Whole Foods is extremely anti-union, almost hysterically anti-union. You know, as soon as there’s a rumor – you know, for example, in San Francisco recently, there was a rumor that there might be an attempt to organize one of the stores there and management immediately flies into action. You know, there’s what they call a “morale meeting”. You know, everything has a different name at Whole Foods. It’s not a captive audience anti-union meeting, which other corporations have. No, at Whole Foods, it’s called a “morale meeting”. You know, when someone gets fired at Whole Foods, it’s referred to as a “separation”. You know, I mean it’s all very, very touchy-feely but it doesn’t make you feel any better. You know, if you’ve lost your job that it’s been referred to as you being “separated” from your company, it doesn’t feel any better I don’t think.

Sonali: My guest is Sharon Smith, author of Women and Socialism and Subterranean Fire: History of Working Class Radicalism in the United States. She has just written a new article that has been published in Counterpunch, re-published on AlterNet and it’s called Something Stinks at Whole Foods. We’re talking about the topic of her article which is Whole Foods and its union-busting policies. Now, of course, the touchy-feely workplace democratic methods are not affecting the bottom line. It may help keep workers happier at least on a superficial level but what does affect the bottom line, of course, is wages and that’s where the anti-union rhetoric and action come in. Do Whole Foods workers, as far as you know, do they see through it or are they fairly excited about being able to have decision-making over which supplier to pick for their tomatoes?

Sharon: Well, you know, I think it’s both. I think, certainly, when you first, you know, go to work at Whole Foods – again, they aim at a very young workforce – so, I’m sure it’s great to work at a job where you don’t have to take off your nose ring.

Sonali: Their dress code is very loose?

Sharon: The dress code is loose.

Sonali: But that’s part of their image, I think, that they promote.

Sharon: Exactly. It probably is a better, sort of on the surface. You know when you first go to work there – it’s like, wow, we get to vote on this stuff? You know, they want our input. So, I’m sure that’s great. But as you work there for longer, I’m sure, and from workers that I’ve spoken with, it doesn’t take all that long to begin to see through it and to begin to see that this is really what’s traditionally known as “benevolent management”. You know, it’s a time-honored management technique that some companies prefer and, actually, it’s an extremely patronizing system. So, for example, if you’re a little extra productive, your team leader can give you a “high-five” and the “high-five” then goes into a pot and you’re eligible to win a contest, you know, kind of thing. It’s very, very patronizing and also at a certain point, you know, I’m sure people get to a point where and a number of workers that I’ve spoken with feel this way, where the bottom line really is – what does my paycheck look like?

Sonali: And, are Whole Foods employees paid less than, say, union workers at Ralphs’ and Von’s, Albertson’s and those other grocery chains that are unionized?

Sharon: Well, I do know that, in general, workers make more, obviously, when they’re in a union. The thing about it also is that you get seniority.

Sonali: Right, and then there’s the whole issue of turnover as I mentioned and you’ve talked about in your article. So, how often are workers “separated” from Whole Foods and is it a policy or is it just that people leave disgruntled at not having higher wages and being able to have a living wage?

Sharon: You know, I’m sure it is that way. They don’t “separate” any more than anywhere else I don’t think. I think it’s more just that they aim at a very young workforce and, you know, people who would more naturally move somewhere else because the wages certainly aren’t anything to write home about so there’s nothing tying people to that job. Whereas, if you go to work in a union workplace you can see that your wages are going to get higher and higher and higher the longer you stay.

Sonali: So they don’t really aim for family people, people who can use enough wages to pay a mortgage or even a small mortgage.

Sharon: Right. And they also, they have a “consumer-driven” health plan which somehow John Mackey, CEO, managed to convince workers to vote for this option and the way he described it to fellow executives in a 2004 speech, he said, “if you want to set up a consumer-driven health plan, I strongly urge you not to put it as one option in a cafeteria plan i.e. among other options, but to make it the only option.” So, that’s an interesting way of voting, you know, you only have one option.

Sonali: And certainly John Mackey cannot lay claim to being extremely democratic in that case. His criticism of EFCA is that it’s anti-democratic even though that has been proven many, many times that card-check isn’t about being anti-democratic.

Sharon: Yes and it’s really appalling to hear the Chamber of Commerce and John Mackey, etc. making this claim that they’re, you know, defending this bedrock of democracy, the right to a secret ballot, when, in actuality, what they’re protecting is their own right to stall long enough for them to hire… 75% of companies facing a union drive in this country at this point in time hire professional union-busters. So, what they’re doing is preserving their own right to, you know, hold captive audience meetings with employees, to fire and intimidate the workers that they think are behind the union drive. That’s really what they’re trying to prevent.

Sonali: And very briefly, Sharon, so Whole Foods may want to perpetrate all of this at their own stores but they’re also playing a very large role nationally in lobbying to defeat EFCA alongside corporations like Wal-Mart. How significant is that?

Sharon: Extremely! Because, once again, they give a progressive veneer alongside Starbucks and whatnot. They make it seem like they’re presenting a soft option – they’re the reasonable ones. They’re moderate. They’re not as nasty as the Chamber of Commerce. They use kinder language and so on while preserving the aims of the Chamber of Commerce which, once again, are forcing workers to use the secret ballot. Right now, by the way, the option of card-check is an option but the decision lies in the hands of employers as to whether to allow that. All EFCA does is allow the workers at the plant to make that decision.

Sonali: Well, Sharon Smith, I want to thank you very much for joining us today.

Sharon: Thank you so much. My pleasure.

Sonali: Sharon Smith is author of Women and Socialism as well as Subterranean Fire: A History of Working Class Radicalism in the United States. We’ll have a link to her article that was recently published on Counterpunch called Something Stinks at Whole Foods on our website later today at KPFK.org/Uprising.

Special Thanks to Julie Svendsen for transcribing this interview.