'Human Rights Watch' Calls Tesco and its Fresh & Easy Neighborhood Market 'Labor Rights Violator' in the USA

Pictured above is Tesco plc director and Fresh & Easy Neighborhood Market USA CEO Tim Mason. Mason came to America in 2006 to start up Fresh & Easy for Tesco as the CEO. The first stores openened in November 2007. Prior to coming the the U.S., he was director of marketing for Tesco, at its global corporate headquarters in the United Kingdom. In March, 2011, Mason will be given the title of Co-CEO of Tesco plc, although the company says he will remain in California as CEO of Fresh & Easy. See here.

News & Analysis

The New York City-based human rights watchdog group Human Rights Watch issued a blistering report today that singles out United Kingdom-based Tesco and its Fresh & Easy Neighborhood Market USA as one of a handful of European companies doing business in the U.S. that have been "carrying out aggressive campaigns to keep their employees in the United States from organizing and bargaining, violating international standards and, often, US labor laws."

The charge by Human Rights Watch comes amidst a now three year campaign by the United Food & Commercial Workers union (UFCW) to organize store-level employees at Tesco's Fresh & Easy, which has 159 stores in California (Southern and the Central Valley); Metropolitan Phoenix, Arizona; and in Nevada's Las Vegas Metro region.

"Many European companies that publicly embrace workers' rights under global labor standards nevertheless undermine workers' rights in their U.S. operations, a Human Rights Watch spokesperson says. Tesco [with Fresh & Easy] is one of those European companies."

The 130-page report, "A Strange Case: Violations of Workers' Freedom of Association in the United States by European Multinational Corporations," goes into some detail, quoting a few former Tesco Fresh & Easy employees.

For example, Shasta Furman, a former worker at a Tesco Fresh & Easy Neighborhood Market store in San Diego, says in the report: "It was constantly driven home to us in team-lead meetings that we should tell employees they have no need for the union, that the company will take care of them so they don't need a union. When the union started passing out flyers outside our store, my manager told us 'You don't want to be part of it. These are not the right people for you.'"

Another former Fresh & Easy San Diego store employee, team leader (assistant manager) Fred Baquet, told Human Rights Watch in an interview for the report: "We had lots of issues. The time sheets were confusing. They had us working through breaks and lunch. People lost a lot of money. I would bring up people's pay problems and management would tell me to tell them... 'If you don't like it, there's the door.' People came to me with complaints and I told them, 'My job's on the line, too.' The managers were always preaching 'no union' to us. Anything union was unmentionable because it could cost you your job."

Human Rights Watch says today's report is based on interviews with workers, employees' legal testimonies, findings of US arbitration panels, company documents, and written exchanges with company management. The report is part of the human rights group's efforts to further strengthen and promote labor laws in the U.S, which it argues are designed to allow employers to side-step human rights conventions and prevent unions from organizing workers.

Along with United Kingdom-based Tesco, which owns and operates El-Segundo, California-based Fresh & Easy Neighborhood Market, the following European companies doing business in the U.S. are named in the report: Deutsche Telekom and T-Mobile; Deutsche Post and DHL Express; mSaint-Gobain; Sodexo; Group 4 Securicor PLC; Kongsberg Automotive100; Gamma Holding and National Wire Fabric107; Siemens115.

"The behavior of these companies, including Tesco's Fresh & Easy, casts serious doubt on the value of voluntary commitments to human rights," says Arvind Ganesan, director of the Business and Human Rights Program at Human Rights Watch. "Companies need to be held accountable, to their own stated commitments and to strong legal standards."

Among the violations Human Rights Watch says it documents in the report are "practices of forcing workers into 'captive audience' meetings to hear anti-union harangues while prohibiting pro-union voices, threatening dire consequences if workers form unions, threatening to permanently replace workers who exercise the right to strike, spying on employee organizers, and even firing workers who support organizing efforts at companies."

Human Rights Watch says this about Tesco's Fresh & Easy Neighborhood Market USA: Fresh & Easy "has created an anti-union atmosphere, and employees who want to organize union activities live in fear for their jobs."

Here are links to two responses to Human Rights Watch from Tesco regarding the organization's claims and report: Response from Tescoto HRW 7-26-2010 and Response from Tesco to HRW10-22-09.

Tesco said today in a statement about the report, which singles out its Fresh & Easy chain as a human rights violator when it comes to labor relations: "Wherever we operate, all staff are free to join trade unions and we have positive relations with trade unions around the world...This report is a further example of misleading allegations being used to misrepresent our position."

In describing the methodology behind its report, Human Rights Watch says: "The Human Rights Watch report is based on thirty interviews with workers and employees' testimony in legal proceedings, findings and decisions of US labor law authorities, company documents, and written exchanges with company management.

Tesco's Fresh & Easy Neighborhood Market has lost two cases in National Labor Relations Board (NLRB) hearings before Administrative Law Court Judges this year, in which employees and the UFCW union charged the grocery chain with violations of the U.S. Labor Relations Act. Fresh & Easy Buzz reported on both of these cases. In fact, Human Rights Watch sites those two cases as the primary basis for its arguments in today's report. (See here.)

Read the two stories linked below:

>March 4, 2010: Administrative Law Judge Finds Tesco's Fresh & Easy Neighborhood Market Violated Labor Relations Act in Ex-Store Employee, UFCW Union Complaint

>June 20, 2010: NLRB Judge Rules Against Fresh & Easy Neighborhood Market in Spring Valley CA Store Labor Law Violation Case

A couple months ago, Tesco bought out its meat suppler for Fresh & Easy, 2 Sisters Food Group. The buyout came shortly after an Administrative Law Judge found 2 Sisters Food Group, which was an independent company that had no ownership affiliation with Tesco or Tesco's Fresh & Easy, in violation of U.S. labor laws in a case involving its firing of six employees over the issue of a union vote at the meat plant. Read our June report: June 20, 2010 NLRB Judge Rules Against Key Fresh & Easy Neighborhood Market Supplier '2 Sisters Food Group' in Labor Relations Violations Case. Also see: June 21, 2010: The Missing Link in Tesco's Purchase of Fresh & Easy Neighborhood Market Meat Supplier '2 Sisters Food Group.'

Tesco brought 2 Sisters Food Group's (its major meat product supplier in the UK) along with it in 2006-2007, when it set up shop in Southern California for Fresh & Easy Neighborhood Market. A couple months ago Tesco bought out 2 Sisters Food Group, along with its produce supplier for Fresh & Easy, Wild Rocket, for what Tesco director and Fresh & Easy Neighborhood Market CEO Tim Mason will only say was "tens of millions" of dollars.

Fresh & Easy Buzz has been closely covering the UFCW union/Tesco Fresh & Easy labor issue for nearly three years. We written reported extensively on the topic, along with offering much analysis. [Click here, here and here for a selection of our stories on the topic/issue. Use the older link at the bottom of the linked page for additional stories and pages.]

In our analysis, it's too early to know the affect today's Human Rights Watch report will have on Tesco's Fresh & Easy Neighborhood Market. However, the human rights group is respected, and counts among its members numerous influential opinion leaders from various walks of like, including many who live in California, where Fresh & Easy is headquartered and has 98 of its current 159 stores. (Thirty four stores are in Metro Phoenix; 27 in Metro Las Vegas.)

We do see the report, and the Human Rights Watch support, as giving the UFCW's on-going efforts to organize Fresh & Easy employees a boost. The union will now be able to point to the human rights group as a respected independent source which agrees with what the union has been arguing about Tesco's Fresh & Easy since 2007, which is that it will do whatever it takes to remain non-union, a charge Tesco has denied is true.

But approval of labor unions by U.S. consumers is at a near all time low, according to Gallup, the leading U.S. polling firm.

A slim majority of 52% of Americans say they approve of labor unions, the second lowest approval rating in Gallup's 70-year history of polling on the topic, behind only last year's 48%, the polling firm found in a poll taken this month (August 5-8, 2010).

Gallup says it first asked Americans to evaluate labor unions in 1936, at which time 72% approved. The all-time high of 75% approval came in 1953 and 1957 surveys. Support for unions declined in the late 1960s and early 1970s, but mostly hovered around the 60% mark until last year, when it dropped below the majority level for the first time, according to the polling firm.

In the August, 2010 poll, 10% of Americans identify themselves as union members, and an additional 6% say another member of their household belongs to a union. Seventy-two percent of Americans who are union members or live in a union household approve of unions, compared with 48% of those in non-union households.

Union approval varies widely by political party affiliation - It's 71% among Democrats compared with 34% of Republicans and 49% among independents. All three party groups expressed their lowest approval of unions last year and, although views improved slightly, they remain less positive than before.

Gallup finds significantly more Americans saying they want labor unions to have less (40%) rather than more (29%) influence than they have today. Twenty-seven percent say their influence should stay about the same.

Prior to last year, Americans were about equally divided in saying they wanted labor unions to have more versus less influence, or showed a tendency toward wanting unions to have more influence.

Regardless of their preference, Americans by a nearly 2-to-1 margin predict union influence will decline in the future. The poll finds 46% of Americans saying unions will become weaker in the future compared with 25% who say stronger. This general pattern has held each time Gallup has asked the question since 1999.

Gallup adds a slight caveat to the poll results however: "Labor unions are less popular now in the United States than they have been for most of the last 70 years. One reason for this could be the economic downturn. With many Americans out of work and struggling to find work, organized labor groups' missions may not seem appropriate or even fair as they might have when jobs are more plentiful. There is some precedence for an economic-related downturn in union approval, as Gallup found a mild drop in union approval during the late 1970s and early 1980s when the U.S. economy was in poor shape."

Additionally, "The more negative appraisal of unions the last two years could be due to the belief from union opponents that unions are likely to benefit or are benefiting from the policies of the Obama administration, including recent legislation providing aid to states that will preserve thousands of education and public sector jobs," Gallup adds about the poll's results.

Fresh & Easy Buzz doesn't put its stock in one poll. However, numerous other polls reflect opinions similar to what Gallup found this month.

But it's important to not lump all unions into the same pile. For example, in California the UFCW union is very strong. The state's top grocery chains - Kroger (Ralphs/Food 4 Less), Safeway/Vons, Albertsons, Stater Bros., Save Mart, Raley's and numerous others, as well as many multi and even single-store independents - are unionized. These grocers represent the majority of groceries sold in California annually from a market share perspective.

The UFCW is a fairly popular union in California overall. This is evidenced in the level of support union-store employees tend to get from shoppers whenever they've gone out on strike over contract issues with the chains. Although we've seen the level of popularity wane a bit over the last decade.

But, on the other hand, the fastest-growing food and grocery retailers in California - and in most parts of the U.S. - are non-union. These include Walmart, which is now the number one grocery retailer in America, Costco (it has some union affiliation in Northern California), Target, Whole Foods Market, Trader Joe's, Sprouts Farmers Market, Henry's Farmers Market, Tesco's Fresh & Easy, and a couple others.

The UFCW hasn't been able to unionize any of the fast-growing chains mentioned above, even though in some instances - Walmart particularly - it been trying to do so for over a decade.

The less than enthusiastic opinion of labor unions does help Tesco in its battle with the UFCW, although it is a relative form of help. For example, with two Administrative Law Judges finding Tesco's Fresh & Easy in violation of U.S. labor law so far this year - and we're told more cases are going to be brought to the NLRB by current and former Fresh & Easy employees together with the UFCW - the grocer is giving its opposition a lot of ammunition.

Right now, the store to watch in terms of union organization and activity at Tesco's Fresh & Easy is its unit at 4211 Eagle Rock Boulevard, in the Glassell Park neighborhood in northeast Los Angeles.

As we recently reported in this story - July 24, 2010: Employees at the Glassell Park-Eagle Rock Fresh & Easy Neighborhood Market Store in Los Angeles Seeking Union Recognition From Tesco - A group of employees recently told Fresh & Easy Buzz they have or are close to having a majority of store workers in agreement that they want to join the United Foods & Commercial Workers (UFCW) union.

Some of the store's employees met with Fresh & Easy Neighborhood Market executives at corporate headquarters in El Segundo, California on March 26, and requested to be recognized as a union store, as we reported in the July piece linked above. Tesco has thus far denied the Glassell Park store workers' request, which isn't uncommon for a company to do.

You can read the full report issued today by Human Rights Watch, "A Strange Case: Violations of Workers' Freedom of Association in the United States by European Multinational Corporations," here.