New Orleans There can’t be much joy these days in Bentonville, Arkansas, home of Walmart and its buddies. The litany of woes just keeps piling up. Five consecutive quarters of reduced financial returns has to lead the list. In the land of the 1% you can just about get away with murder if you’re making enough money, but now that the emperor is increasingly walking down the superstore aisles naked, and people are starting to notice.
Bribery in Mexico and accusations of the same in India and China have cost Walmart almost a billion in legal fees and whatnot to try and cleanup for example. The financial press, normally so soft and bullish about the company, pointedly noticed recently the number of high level big whoops that had exited from the company and the board, many with big footprints on their rear ends, no matter how many press releases to the contrary. Even the Chinese government has jumped them for the quality of their food in its stores after years of patty cake treatment.
Adding to this litany of woes is a long overdue slap down up north as the Supreme Court of Canada ruled that the company was dead wrong in closing its store in Quebec and despite all of its protestations, the Court was clear that the Jonquiere store was closed in 2005 because the workers had successfully organized a union with the United Food and Commercial Workers (UFCW). The court in a 5-2 decision upheld an earlier arbitrator’s decision saying essentially the same thing. The store had been organized in 2004 and when contract negotiations ended in an impasse, the company closed the store claiming insufficient returns. The court has now returned the case to the arbitrator to determine the amount of back pay owed to the 200 workers put on the street.
Will the company learn something from all of this? I doubt it. They told the Wall Street Journal that they were reviewing their options. What’s to review? They just lost at the highest court level in Canada, so they have nowhere else to run and hide. Unfortunately, this is Walmart, so their strategy will be more delay. They are a decade out from the time they shut the store down. I would bet they will also try to appeal the arbitrator’s back pay award once it is determined, and try to buy another couple of years to plead for court review of that as well. While the UFCW argues that Walmart is learning a lesson that might inspire more workers in Canada to take a shot at organizing the company, the company is trying to send the message that sure, “take your best shot,” and then look at the lengths we will go to before you see a single looney after maybe fifteen years.
Nonetheless, the clock finally seems to be ticking on this anti-union, anything goes behemoth. When they were expanding around the US and the globe, Wall Street could tolerate anything. Now that their returns are slackening and their fast dealing is unraveling the brand, it could be that even their anti-union mischief is finally running out of time as well.