Natural Foods Merchandiser

Learning to Live—and Work—With Labor Unions

The Natural Employer

The vote this past July by workers in a Madison, Wis., Whole Foods Market store to join the United Food and Commercial Workers Local 1444—and Whole Foods' subsequent appeal to nullify that vote—became a high-profile event and may mark a turning point in labor relations in our industry. The president of the Wisconsin AFL-CIO certainly hoped so when he said he expects a number of other Whole Foods stores around the country to go union. Although the idea of a unionized workforce may be anathema to some, at least a dozen food cooperatives, including some considered successful leaders in their markets, have lived with unions for years.

For Paul Cultrera, general manager at Sacramento Natural Foods Co-op, the fact that many of the co-op's 126 employees have been represented since 1995 by the Teamsters did not give him pause when he took the GM job two years ago. In light of several co-op management changes in previous years, he saw that having a union might give employees a sense of stability.

"It imposes a structure that, left to our own devices, we might not have imposed—but it works," Cultrera says. "The contract gives us a fair amount of discretion without hindering our entrepreneurial spirit."

Perhaps the relative harmony at SNFC stems from management convincing the union "we have the employees' best interest at heart." On his own initiative, Cultrera proposed a living-wage package based on a survey of the staff and on research on living costs in the Sacramento, Calif., area. "We probably offered more than they were going to ask for," he says. Management also instituted a "gainsharing" program outside of the contract that rewards workers for increased productivity and decreased labor costs. Cultrera says the program has been successful at his store.

Nearly a quarter of Fortune 1000 companies—and many smaller firms and public-sector organizations—use gainsharing programs in their operations.

At Outpost Natural Foods Co-op in Milwaukee, employees joined the United Food and Commercial Workers back in 1979. Pam Mehnert, general manager since 1987, now oversees two stores and more than 200 employees, most in the bargaining unit. For the past three contracts, Outpost has adopted interest-based bargaining, an approach that focuses on problems and solutions rather than personalities. For this, the Federal Mediation and Conciliation Services of the U.S. Department of Labor provided free training and retraining.

In conventional bargaining, Mehnert explains, each side brings more demands to the table than they know they'll end up accepting. This can lead to some "ridiculous" demands. With the interest-based method, "you know you're coming to discuss real things."

Because the union has been at Outpost for so many years, the contract language doesn't change much, Mehnert says. "Mostly we focus on benefits." In the last negotiation, management made a budget presentation for union business agents and stewards. "We went through the budget line item by line item. When they saw how much insurance cost, that was eye-opening for the stewards," she relates. "Our common interest was that we wanted the employees to have insurance."

A commonly expressed fear about unions is management will no longer be able to talk directly to employees. Yet that fear has not come to pass at Outpost. An employee survey conducted before a contract negotiation revealed a host of noncontract issues could not be addressed through the bargaining process. Most had to do with communications storewide and between departments. Thus was born the Communications Forum, a successful program operating since 1998. Once a month, each store's management team sets aside an hour for employees to bring questions and concerns to be addressed either directly at the meeting or later through the meeting minutes distributed to staff.

Although she strongly supports interest-based bargaining, Mehnert acknowledges it may not be possible for a first-time contract negotiation in a newly unionized workplace. "With a new union, there's no basis for trust yet. You need some history in place first."

When asked for advice to managers going through contract negotiations for the first time, Cultrera suggests: "Try to do without the posturing. Be as honest as you can. Be up front about what you're willing to give. Be fair. Realize that the union has its role to play."

Natural Foods Merchandiser volume XXIII/number 10/p. 42

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