Press release for press conference on the Anti-Walmart Coalition Campaign press conference held on 4th November 2010 at SACCAWU House, 11 Leyd Street, Braamfontein
On 27 September Walmart made a ‘non-binding’ offer to takeover Massmart. SACCAWU having anticipated this approach and met with most major retailers more than a year ago about the interests and likely designs that Walmart might have in acquiring business in South Africa. All of those major retailers except for Massmart agreed to meet with the Union, and all indicated that they were approached by Walmart and turned down the offer. Massmart on the other hand responded that media reports about Walmart’s interests in them were mere speculation and refused to meet with SACCAWU.
The Union at the time, went on record stating ‘come what may, Walmart will set-up shop in the country’. It was also since that development that we observed a marked shift and increased hostility by many major retailers towards SACCAWU, engaging in aggressive rebranding, restructuring, re-engineering, repositioning culminating in retrenchments in most if not all cases ; and general witch-hunts on shop-floor leaders in many stores throughout the country. Suddenly disputes that would have been settled expediently and amicable in the past, now reached deadlocks compelling many workers at store levels to take strike action or contemplating to do so.
Whilst some of our members did not initially understand this hardening of company attitudes, with whom we had long and fairly stable industrial relations, rapidly were changing so dramatically and aggressively towards the Union.
‘This is the beginning of the Walmartisation of the sector’, SACCAWU declared and had since without fail educated our membership on the Walmart business model, the Walmart anti-union philosophy elaborated in their Blue Print Document serving as Managers’ Tool Kit, titled; ‘How To Remain Union Free’; and located many of our struggles within this understanding. Today, all our warnings have been borne out.
Even a company like Pick ‘n Pay that many commentators saw as a very liberal company changed in this way, manifesting itself in quite expensive rebranding, outsourcing of logistics, employment of foreign experts, excessive use of Labour Broker supplied labour and unilateral termination of the Jobs Security, Flexibility & Mobility Agreement – a collective agreement, that has been helpful in gradually phasing out massive casualisation. But currently refusing to accede to more than reasonable wage demands submitted as far back as 2009 December, given that increases were due in march 2010 That is the main reason why we have the strike in the company today.
In the meantime, coupled with this sudden repositioning by wholesalers and retailers, despite the denials by Massmart, unilateral re-engineering within Massmart went ahead albeit all the objections and disputes declared by the Union. Sometimes they even went against collective agreements days after being signed, leading to large numbers of workers being dismissed. And in the early hours of 27 September, a few hours before the precautionary announcement was made on the JSE about the ‘non-binding’ bid by Walmart to takeover Massmart, some labour leaders including the president of SACCAWU as well as the President and General Secretary of COSATU were telephonically informed about an important announcement that was to be made on the JSE that same day. We know that this was merely a ploy and just running through the motions to comply with legislation. And they even on the same day went further and posted notices at the workplace notice boards claiming that they have consulted with the Union and COSATU leaders. This clearly was another move on their side to try and set workers up against the Union leaders, an old tactic of Walmart.
After our press statements declaring our intention to campaign against this bid, they invited us to a meeting that included a representative of Walmart. The Union did not accept their explanation for the reason that we have been treated with such disdain and contempt. And we refused to accept the explanation that they were not aware of the interest Walmart had in Massmart until the Friday before the Monday of JSE announcement.
The Union pointed out to the company’s representatives that it would be naïve of us to believe that an transaction of this magnitude caught them by surprise and further that it would be insulting our intelligence if they expected us to accept that such an enormous decision of a transaction of such scale could be knocked-out and agreed upon over one day, of course unless Massmart representatives were induced by greed on hearing the offer made by Walmart. After all if the deal goes through at the current share offer the CEO will walk away with well over R200 million.
In that same meeting the Union presented the Companies in this transaction, with fifteen demands that the merging parties commit themselves to even before the transaction is concluded. To date the Companies are yet to respond to those demands, and it seems unlikely that they have any intention to do so.
It is within this context that the Union called meetings of all Massmart Group shopstewards chairpersons and National negotiations team, and it is also for this same reason that the Union convened Joint Shopstewards Councils throughout the country to report and discuss our responses to the threat of Walmart entering the South African market. We have since held meetings with COSATU and various other Unions, including all the UNI Global UNION and her affiliates, UNI-Africa, where an agreement for such a campaign was reached and all organisations pledged their support for the campaign.
It is also from these meetings that a campaign was formulated and the meeting convened by SACCAWU to discuss the impending takeover of Massmart by Walmart was held on the 3rd November 2010. At this meeting it was agreed to establish an Anti-Walmart Coalition. The meeting was attended by a range of organisations including trade unions, UNI-Africa and other civil society organisations.
After inputs by the President, Amos Mothapo, General Secretary, Bones Skulu and Deputy General Secretary, Mduduzi Mbongwe; followed by discussions on the implications of this bid by Walmart, an assessment of the challenges of the dangers of this bid for the retail sector, the economy in general, decent work, new growth path, the Buy South Africa Campaign, implications for agriculture, local manufacturing and food processing, suppliers as well as distributors given Walmart’s procurement policies. The meeting agreed on a need for such a Coalition and SACCAWU to convene the next meeting of the Coalition.
The meeting also agreed to provide all the support to the striking workers at Pick ‘n Pay and further endorsed a Consumer Boycott of Pick ‘n Pay. The meeting also discussed elements of the program to mobilise our communities to support the Pick ‘n Pay striking workers and the Consumer Boycott.
Few people in the public and many journalists do comprehend the immensity of the implications of this deal if it goes through unopposed and without stringent condition to protect our sector, related sectors, the local economy in general, the country and continent’s developmental agenda. For this reason we will outline below some background to Walmart and Massmart.
What is Walmart?
- Walmart is a multinational retail company with its origins and strong presence in US and is by any standards, the biggest retail company in the world, with the highest turn over and profits.
- To put it into perspective; Walmart’s revenue for 2009 was almost twice South Africa’s GDP, or put differently, if Walmart was a country it would be in the top twenty richest countries
- Today Walmart operates in sixteen (16) countries across the globe, covering all continents except Africa.
- Walmart operate close to 8 600 stores throughout the world, more than 4 000 in the US alone and employed approximately 2.4 million workers more than half of them in the US.
- Walmart has redefined the retail landscape and in many countries where they and sourced goods from, had redefined the economic landscape.
- Walmart has become so powerful that they are able and do dictate to manufacturers, suppliers and distributors their prices and in many instances have driven down prices, and in return wages in their own and other sectors; and so are the standards of living of millions across the globe.
- Most recently in May 2010 Bloomberg reported that Wal-Mart Stores Inc., the world’s largest retailer, is seeking to take over U.S. transportation services from suppliers in an effort to reduce the cost of hauling goods. Now while reducing costs and as well as improving productivity is good for any economy, but when companies realise this through increasing precarious employment contracts, less benefits and lower wages; it is not good for the working class, it is not good for the economy and it will not be good for our country or the continent’s developmental imperatives.
- Walmart’s procurement policies of compelling farmers, manufacturers, distributors and suppliers to push their prices down has seen the collapse of many small and sometimes even big businesses.
- Walmart’s procurement policies lock suppliers in them driving down their prices or drive them out of business. This has led to extreme exploitation of women and children in the developing countries, where suppliers now have to drive down their own costs to make a profit.
- Similarly a large movement opposing further expansion in the US has developed ,where citizens have voted against the development of Walmart giant format stores. But of course Walmart can simply buy property and develop or just cross a city, county or state border to continue with their plans.
- On the ecological front Walmart has been under scrutiny from ecological activists and was proven many times to be found wanting with products, transportation, production processes from their suppliers and even parking for the giant stores. All of which does enormous damage to the environment.
- But worst still Walmart has such a public hostile Union stance, to the point where from workers’ interviews they test whether they will be prone to join unions. After employment the induction training spends as much time telling workers how bad unions are than is spent on training new employees on health and safety.
- And where workers do get organised in the US and Canada, they simply close down the store or department and there are many cases to show that. Where they are unsuccessful, they simply break the law and go to court for years, appealing, and here there are so many case examples that can be cited.
- Today Walmart is faced with numerous class action law suits, affecting hundreds of thousands of workers for not paying overtime,gender, racial and other forms of discrimination. A special case worth mentioning here is the class action of more than 1.5 million former and current female employees for gender discrimination.
There are still many other examples that can be listed, and yes we should be worried, very worried, not only as workers and trade unions in the retail sector, not only as workers and trade unions in general, but as a country and citizens; if we really care about our developmental agenda and the stubborn legacy of apartheid that still linger on and remains with us today.
It is these concerns that underpin our Campaign and the launch of the Anti-Walmart Coalition yesterday.
As for the bid, we have received notice yesterday whilst discussing the implications of the takeover that the Walmart offer currently having entered the next phase. They have filed with the Competitions Commission their offer. And they clearly state, that even if they only acquire shares in excess of 50% the intention of the transaction is to have sole control over Massmart. And with Massmart operating in 13 African countries. This certainly is bound to have serious and devastating effects to our economy, our Buy Local Campaign, local economies and likewise this will apply to the rest of the continent where they will be operating.
It is for all these reasons that we will explore all possible avenues to make sure that if the deal goes through, the conditions be of such a nature that it protects and extend worker rights, that it adheres to our local and continental developmental agenda and that decent work is entrenched.
Finally as a trade union, we insist that Walmart signs a Global Framework Agreement with Uni Global Union, to ensure that we extend protection of workers employed by Walmart everywhere in the world; in particular in the US.
Below is the set of demands developed by SACCAWU and endorsed by the meeting of the 3rd of November.
- There must not be cancellation of any existing agreements and down variation of terms and conditions of employment.
- The terms and conditions of employment covered by existing agreements with SACCAWU must be extended to all Massmart operations throughout the continent where the same do not exist.
- Massmart must reinstate all workers dismissed during the dispute as a result of the Company’s unilateral breach and and deliberate misinterpretation of the strike settlement, re-engineering and unilateral restructuring of the workplace.
- There must be Group Centralised Bargaining.
- There must be a close-shop agreement.
- The Company must commit to closing the apartheid wage gap and other disparities across the group.
- There must be effective integration of workers from all divisions and brands.
- There must be no supply of labour broke workforce.
- The Company must convert all casuals to full-time employment.
- There must be Job creation.
- There must be clear local procurement policies towards developing local agriculture, food processing and manufacturing, economies with clear decent work imperatives in job creation.
- There must be adherence to local labour legislation and polices of Broad-Based Black Economic Empowerment, Employment Equity and skills development and training.
- Walmart must sign a Global Framework Agreement with UNI Global Union.
- Walmart must stop its opposition to the US Employee Free Choice Act.
- Walmart must commit to dealing with adverse employment conditions experienced by worker from their suppliers.