Union Power Is Putting Pressure on Silicon Valley’s Tech Giants - Bloomberg
Description: Organizers have unionized 5,000 contract workers at Apple, Facebook, Yahoo!, and more.
Keywords: technology,businessweek-magazine,game-plan

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Technology

# Union Power Is Putting Pressure on Silicon Valley’s Tech Giants

Organizers have unionized 5,000 contract workers at Apple, Facebook, Yahoo!, and more.
Illustration: 731

Organized labor doesn’t rack up a lot of wins these days, and Silicon Valley isn’t most people’s idea of a union hotbed. Nonetheless, in the past three years unions have organized 5,000 people who work on Valley campuses. Among others, they’ve unionized shuttle drivers at Apple, Tesla, Twitter, LinkedIn, EBay, Salesforce.com, Yahoo!, Cisco, and Facebook; security guards at Adobe, IBM, Cisco, and Facebook; and cafeteria workers at Cisco, Intel, and, earlier this summer, Facebook.

The workers aren’t technically employed by any of those companies. Like many businesses, Valley giants hire contractors that typically offer much less in the way of pay and benefits than the tech companies’ direct employees get. Among other things, such arrangements help companies distance themselves from the way their cafeteria workers and security guards are treated, because somebody else is cutting the checks. Silicon Valley Rising, a coalition of unions and civil rights, community, and clergy groups heading the organizing campaign, says its successes have come largely from puncturing that veneer of plausible deniability.

That means directing political pressure, media scrutiny, and protests toward the tech companies themselves. “Everybody knows that the contractors will do what the tech companies say, so we’re focused on the big guys,” says Ben Field, a co-founder of the coalition who heads the AFL-CIO’s South Bay Labor Council. Labor leaders say their efforts have gotten some tech companies to cut ties with an anti-union contractor, intervene with others to ease unionization drives, and subsidize better pay for contract workers.

“If you want to get people to buy your product, you don’t want them to feel that buying your product is contributing to the evils of the world,” says Silicon Valley Rising co-founder Derecka Mehrens, who directs Working Partnerships USA, a California nonprofit that advocates for workers. Tech companies have been image-conscious and closely watched of late, she says, and the coalition is “being opportunistic.”

The first such recent effort, in 2014, unionized 87 Facebook Inc. shuttle drivers employed by contractor Loop Transportation Inc. “We won by beating up Facebook, not beating up Loop,” says California Teamster leader Rome Aloise. Initially, Loop resisted recognizing the union, citing Facebook’s opposition, according to Aloise. So the Teamsters forced a vote by the drivers that was supervised by the National Labor Relations Board (the union won); union activists drew media attention to stories of Facebook shuttle drivers sleeping in their cars between grueling split shifts. “We got press in Japan and Germany and all over the world by saying Facebook,” Aloise says. “Nobody would’ve given a shit if I was saying Loop.”

Eventually, Facebook says, it OK’d proposed terms of the contract, which hiked drivers’ average pay by half, to $27.50 an hour, and for the first time provided fully paid family health care. Facebook also agreed to cover Loop’s added costs. Loop signed the contract. It didn’t respond to requests for comment, but Facebook denies discouraging unionization. “Our vendor workers are valued members of our community,” Facebook said in a statement. A spokeswoman says collective bargaining is up to contractors and their employees, but notes that since 2015, Facebook has required contractors to provide anyone doing “a substantial amount of work” for the company an hourly wage of at least $15 and three weeks of paid time off.

When more than 500 cafeteria workers employed by Flagship Facility Services sought this year to join the union Unite Here!, Facebook says it didn’t direct Flagship’s handling of the situation. But it made clear to the contractor that Facebook would be neutral toward the organizing campaign and wouldn’t punish Flagship if the workers unionized, the spokeswoman says. Like Facebook, Flagship took a neutral position, and the workers joined the union in July.

Where possible, Silicon Valley Rising has pushed for policies that would more broadly strengthen labor’s position. In San Francisco the coalition persuaded the city transit authority to make it easier to deny permits to companies facing labor strife. In Santa Clara, where Intel Corp.’s unionized cafeteria staff had lost their jobs after the company brought in a new nonunion contractor, the coalition led the passage of a municipal law designed to avert such situations. The ordinance requires that new building service or food service contractors retain the old contractor’s employees for at least 90 days. After protests outside Intel’s headquarters, the cafeteria workers unionized again in an election last year. According to Unite Here, Intel and its contractor didn’t campaign against the union in the lead-up to the vote. Intel declined to comment.

The Valley campaign resembles a 1990s-era push by the Service Employees International Union to organize tens of thousands of janitors who were technically employed by building management companies. Apple Inc. was a prime target—the campaign included a hunger strike, a boycott, and a full-page ad in the New York Times—and workers there unionized after the contractor dropped its opposition to the union, presumably with Apple’s blessing. That offered a model for SEIU’s organizing of other tech janitors and, more recently, the Valley’s security guards.

Tech companies are open to such outcomes partly because contracted service staff represent a tiny share of their overall costs, says former SEIU leader Stephen Lerner, who led the ’90s campaign. It’s much less threatening to a company to have outside contractors unionize, he says, than it would be to let, say, Facebook engineers do so. David Huerta, president of one of SEIU’s California locals, says organizing among direct employees is a longer-term possibility.

Union critics say tech companies will come to regret intruding on contractors’ labor relations. “The fact that they have to browbeat employers or subcontractors into taking away rights from workers shows that the union business model is failing,” says F. Vincent Vernuccio, a fellow at free-market think tank Mackinac Center for Public Policy who served on President Trump’s transition team.

Leaders of Silicon Valley Rising say they’ll support any workers who want to organize. Their near-term challenge is establishing a role for organized labor in Google Inc.’s massive planned expansion in San Jose. The city has voted to negotiate exclusively with Google on the sale of land for a new campus, and organizers want any deal to include provisions addressing such issues as affordable housing and the creation of quality jobs for local residents. “We expect our contractors to treat their employees well and we choose partners who do so,” Google spokesman Ty Sheppard said in an emailed statement. “We’ll be collaborating closely with city officials and community members as part of the public approval process.”

On Aug. 24, Silicon Valley Rising hosted a forum for San Jose residents to air their concerns and demands. As English-, Spanish-, and Vietnamese-speaking attendees broke into groups to brainstorm, an official from the city manager’s office circulated through the crowd to listen. When the crowd reconvened, Andrew Barney, a former Intel cafeteria worker, drew cheers and applause when he said, “I think Google should pay the residents of this community for being allowed to squat in our backyard.”

“Google’s vulnerable right now with all this building and everything they’re doing, and they need a lot of approvals,” says the Teamsters’ Aloise. “We may just pick one, one time, to get involved, and see if we can stop it and have them come to us and say, ‘What do you need?’ ”

BOTTOM LINE - Silicon Valley Rising has unionized about 5,000 contract employees by working consistently to call out the tech companies where they work.
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