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Canadian UFCW members got first collective agreement in North America: Is Wal-Mart now afraid that an Obama victory could help its workers to join their union?

Wal-Mart now has its first collective agreement in North America. Eight workers at the retail giant's Tire and Lube Express garage in Gatineau in Quebec, next to the Canadian capital Ottawa, joined UFCW in 2005 and have ever since tried to gain a contract. Now finally, a government arbitrator put and end to Wal-Mart's efforts to evade this responsibility, and imposed a collective agreement on the site.

The Canadian collective agreement is not the only concern for the world's largest retailer. At home in the United States, the next president is very likely to be Barack Obama. He and the Democratic Party have signalled that they will give workers a fair chance to decide on trade union representation without employers being able to block it as they can do today.

Managers warned workers about Obama election victory

This has sparked some ill advised and questionable activities within the Wal-Mart chain. Managers have held meetings at workplaces, where they have warned workers that their right to keep unions out would be endangered if Obama wins in the elections. This has been a thinly veiled message that the employer wants them to vote Republican.

Now, the U.S. trade union movement has asked for a government enquiry inton whether Wal-Mart has violated laws on campaign financing. At least from the outside it looks like it could well be the case, and more seriously that there has been a very improper inteference from employer representatives in the rights of the workers to make their own decisions.

1.5 of 2 million workers in North America

For the Bentonville Arkansas based retailer, its North American home market is still dominant. Out of 2 million Wal-Mart employees worldwide, close to 1.5 million work in North America. These workers are denied a collective agreement, to keep expenses down by undercutting labour costs.

Three years ago, shop workers in another Quebec town - Jonquière - also joined UFCW and started to negotiate a collective agreement. It did not take long for Wal-Mart to react by closing the entire store and taking the jobs away from over 200 workers. This followed many earlier occasions in the United States where the company had gone to great lengths to keep its personnel out of unions.

Size and logistics important but not enough

Wal-Mart's concept is to be a discounter, to undercut the prices of competitors. The company is particularly strong on non-food, reflecting its roots close to the dollar store concept. More recently, its shops have increased their food departments as well, but still they are far behind some of the more specialised food and supermarket retailers.

Benefits of size and highly developed logistics are of course major competition tools for Wal-Mart. But Wal-Mart is not alone - the main competitors, both at home and abroad, are not lagging behind. To gain a competitive edge, something else is needed as well.

Social dumping and keeping workers out of unions

Social dumping is the word. By paying less and by giving social benefits to as few workers as possible, the huge employer can make enormous savings. In the United States, Wal-Mart can still find an abundance of job seekers who are forced by their living conditions to accept employment conditions also when they are far below the normal standards.

In this world, trade unions do not fit in. This is a working life where the employer dictates the conditions, and where workers do not have a voice. Their needs and interests are not what matters when the quest to create profits and shareholder value are the overriding objectives for management.