Canada Supreme Court Sides With Wal-Mart

After its outlet in Jonquiere, Quebec, Canada, voted to unionize, Wal-Mart acted quickly and shut the damn place down. Predictably, the union sued and vowed to hold its breath and turn blue until justice prevailed.

Justice did prevail--on the side of Wal-Mart. In a 6-3 vote (I can't understand the stupidity, er, rather, I fully understand the stupidity of the three dissenters), the Canadian Supreme Court ruled that there is no law requiring companies to stay in business.

Justice Ian Binnie, citing previous case history, said no law can forbid a business from shutting down, even if it does so for "socially reprehensible" reasons.

Full story here.

Wal-Mart Finds Another Way to Crush the Enemy

It was big news when Wal-Mart came out this week in favor of an employer mandate for health care, meaning that all employers (unless exempted by size) would have to provide health care for their workers or pay a tax to the government.

Not only did Wal-Mart endorse the employer mandate now under discussion in Congress, but it also did so in concert with the Service Employees International Union (SEIU) by issuing a joint statement.

Is this a reprise of the British surrender tune at Yorktown of "The World Turned Upside Down"?

Not really, though the news did garner gushing gagas from the liberal media.

In truth, there was at least one obvious motive in Wal-Mart's endorsement--crush the competition by making them spend their money on health care.

Behind the scenes, there may also have been some promises or compacts made between the SEIU and Wal-Mart: "Keep the unions out, and we'll endorse the employer mandate" or some such.

Finally, there's the obvious clout with official Washington that this brings to the nation's largest private employer.

Plus, why fight the obvious? With Democrats holding all the cards in D.C., an employer mandate is as sure as death and taxes.

Chalk one up for Wal-Mart.

Score: Card Check 0, Wal-Mart 1

Now, here's one for all of you who love the idea of card-check unionization as embodied in the nascent Employee Free Choice Act (EFCA).

The United Food and Commercial Workers Union (UFCW), using card check, organized a Wal-Mart store just outside Montreal, Canada, in 2005. And, of course, it began collecting union dues (the sine qua non of labor and politics, the almighty buck).

The UFCW spent the next three-plus years trying to negotiate a contract, and this was in the heart of union-loving, union-friendly Canada, with Wal-Mart balking the whole time.

The issue, a la EFCA, went to arbitration, and the arbitrator this week issued his finding.

Guess what?

Wal-Mart won big time. Arbitrator (remember, this is unionville) Alain Corriveau ruled that the UFCW demands would destroy Wal-Mart's business model, which he said treated employees as well or better, wage- and benefits-wise, as competing retailers.

Wal-Mart’s compensation system, said the arbitrator, "must be retained," and "falls within the culture of the company which encourages and privileges performance at work." He added: "Putting into place...a wage scale as proposed by the union would also drastically change an important piece of [Wal-Mart’s] business model."

He did grant a 30-cent wage increase over the next two years to current employees at the Saint-Hyacinthe Wal-Mart so they wouldn't be "impoverished" by union dues. New hires will not get the raise, however. (Read more details here.)

Question: Are the employees now going to card check the UFCW out of their store?

Answer: If they're smart, they will.

Chinese Use Card Check to Unionize Wal-Mart

I've written previously about the card-check union organizing provision in the Employee Free Choice Act (EFCA) now before Congress. It turns out that this is the same method, gathering signatures, that Chinese workers used to set up unions in every Wal-Mart branch in China.

This was fairly revolutionary for the All-China Federation of Trade Unions (ACFTU), which had been accustomed to being co-opted for a price. Generally, the union would approach the management of a company and strike a deal for one of its own to be given a mid-management position to oversee the union branch, and in the bargain would receive two percent of all wages for its operations. That two percent, naturally, would go to the main union, but it would also be used to buy presents for the workers at Chinese New Year's and so on. Workers' rights would hardly be considered.

Wal-Mart, however, balked at this process and wouldn't accede to hiring a union rep or to paying the two percent. It pointed to Chinese law, which said that the workers had to request a union. This was anathema to the ACFTU, which had never had to organize and by law couldn't even strike. ACFTU had no experience in grass-roots mobililzation.

Surprise, surprise, however, came when workers at the Jinjiang Wal-Mart in Quanzhou City, Fujian Province, met in the middle of the night and collected the 25 signatures necessary to form a union. Wal-Mart at first threatened to fire anyone who joined the union, but as branch after branch went through the "card check" process, Wal-Mart accommodated the ACFTU and is now unionized nationwide.

So, you can see why American unions thirst for EFCA and card check.

Somehow, though, I think unionization would cost Wal-Mart U.S.A. more than two percent of its payroll. That's why its opposition to EFCA is so ferocious.

Straight Out of Dickens: Labor Strife in China

You might think it was the early phase of the Industrial Revolution in Great Britain if you visited South China these days.

Guangdong Province is the manufacturing heartland of China, and its factories supply a lot of what we Americans find at Wal-Mart and many other retail stores, especially toys.

But things are getting tough in China, by many standards tougher than we have it here in the U.S.

First, under pressure from Wal-Mart and other large-scale buyers, China officially raised the minimum wage, but that didn't stop Wal-Mart from simultaneously demanding lower costs. Profits, at least for the toymakers, sank immediately.

Then came higher fuel costs and now the recession in the U.S., and factory after factory in Guangdong began shutting down; factory hands were let go en masse, many of them migrant workers whose families back home in distant provinces depend on them for monthly cash infusions--and bare survival.

Since the beginning of 2008, some 3,600 toy factories have gone under, leaving hundreds of thousands without work, yet China still publishes an official unemployment rate of 4 percent.

Now, the workers are fighting back--literally. Dongguan, the city where the toy manufacturers are concentrated, has witnessed several episodes of laid-off workers' occupying and trashing the factories after they're closed. Riot police have been called in. Scenes have gotten ugly. Tensions are understandably high, as is anxiety for the future.

But since the owners of the factories often disappear into the hinterlands after closing shop, local authorities are usually powerless to collect back wages, let alone enforce severance packages. In some cases, the government--hoping to keep face--has itself coughed up the workers' earnings.

As it stands, Chinese factory workers toil up to 80 or more hours a week (when times are good) for the princely sum of 770 yuan a month, about $118. Overtime is almost never paid.

In the States, we just witnessed the employee occupation in Chicago of Republic Windows and Doors, which was abruptly shuttered after Bank of America closed its line of credit to the firm.

The laid-off workers demanded 60 days' wages and benefits under the WARN (Worker Adjustment and Retraining Notification) Act since that law requires firms to give 60 days' advance warning of mass layouts (unless there is an unforeseen emergency, a gray area).

Just last night I heard that BofA was going to advance Republic a $1.2-million loan to remunerate the fired employees.

So, the employees won, evidently, but I have one question:

How is Republic going to repay BofA if it's no longer operating the factory?

(I just learned, but I don't know if it's accurate, that the sum is actually $1.75 million and that it will go into a fund with money from both JPMorgan Chase and Bank of America. This would seem to indicate that it's not a loan, but a publilc relations tactic to counter consumer and public ill will toward the banks.)