Calif. Warehouse Workers Present Safety Grievances to Wal-Mart Union-backed report ties worker abuses to subcontracting practices

By Roy Maurer Sep 25, 2012

On Sept. 18, 2012, at City Hall in downtown Los Angeles, striking warehouse workers who deliver goods for Wal-Mart concluded their 50-mile “Walmarch” that demanded improved pay and better working conditions.

The six-day pilgrimage was meant to raise awareness about working conditions in Southern California warehouses that serve major retailers such as Wal-Mart, said Elizabeth Brennan, communications director for Warehouse Workers United (WWU), in an interview with SHRM Online. On the day before the marchers arrived at City Hall, the WWU delivered a letter from the workers with more than 37,000 signatures to the Wal-Mart office in Los Angeles. The letter asked to meet with Wal-Mart executives and stated:

[O]ur work is unsafe, injuries are common, and the pay is so low we cannot make ends meet. Right now, the temperatures in Riverside and San Bernardino top 100 degrees daily and inside the metal [shipping] containers the temperature can get up to 120 degrees. There is little ventilation and the heat and pollutants we inhale can make us vomit and bleed from the nose. We face intense retaliation from management if we say anything about the conditions.

The workers filed a complaint with the California Division of Occupational Safety and Health, which described a workplace rife with unsafe conditions, including limited or no access to clean water, high temperatures, broken equipment, and unreasonable and unsafe quotas. They claimed they are charged for required safety equipment and are often blocked inside the trailers they are loading for up to 30 minutes with no means of exit.

The complaint alleges that workers who are injured on the job are denied access to medical care or compensated time for recovery, and are often told that they will be laid off if they can’t work while injured, all in violation of California law. Workers also reported a thick black dust that covers the floor of trailers and containers; they believe inhaling the dust leads to nosebleeds, vomiting and coughing blood.

Who Is in Charge?

The workers are employed by staffing company WareStaff, and the warehouse is operated by a company called NFI. Although the workers are employed by these subcontractors, Wal-Mart has control over the subcontractors’ working conditions, according to WWU and a study by the labor-backed National Employment Law Project (NELP).

The report, released in June 2012, concluded that the subcontracting practices of retail giants like Wal-Mart contribute to “rampant workplace violations, including health, safety, and wage-and-hour abuses affecting thousands of workers who load and unload consumer goods at the nation’s largest distribution hubs.”

The problem goes far beyond Wal-Mart, said Christine Owens, executive director of NELP, in a statement. “Domestic outsourcing, or subcontracting, is on the rise across the U.S. economy, and without fair ground rules that are respected by all players and rigorously enforced, the quality of many more jobs in America will spiral downward.”

According to the report, there is no precise measure of the number of workers in the United States today, who are contracted out, although earlier studies have estimated that as much as 30 percent of the U.S. workforce was in some sort of “contingent” or nonstandard employment relationship. Subcontracting is standard in the construction, garment and agriculture industries, and domestic outsourcing is becoming increasingly common in many of the largest and fastest-growing U.S. industries, including janitorial and building services, home health care, warehousing and retail, high-tech, delivery, trucking and hospitality, according to the report. Many of these outsourced jobs employ immigrant workers.

Wal-Mart Responds

Wal-Mart spokesman Dan Fogleman told The Huffington Post on Sept. 19, 2012, that Wal-Mart executives toured many of the company’s contracted warehouses, including the one in Mira Loma, and determined that the workers’ claims were “either unfounded, or if they are legitimate, have been addressed.”

He said that Wal-Mart is developing a protocol of random inspections by third-party organizations and that the “working conditions observed are fairly standard across the facilities utilized by Wal-Mart service providers and are consistent with the conditions in our own warehouses.”

Fogelman characterized the warehouse workers’ strike as an unfair attempt to draw the retail giant into a political campaign by organized labor.

“Part of the union playbook is to drag the Wal-Mart name into the discussion, because it gets you guys in the media to pay attention,” he told The Huffington Post.

‘Lumpers’ and the Logistics Warehousing Boom

In recent years, supply chain or logistics warehouses have sprouted up across America, with Riverside and San Bernardino counties in Southern California’s Inland Empire serving as a primary entry point for goods manufactured in Asia and destined for U.S. retail stores. Workers at these warehouses are at the nerve center of U.S. commerce: they transfer imported goods from international and domestic shipping containers into vast warehouses, and reload trucks with tons of merchandise for shipment to retail stores around the country.

While warehousing in the Inland Empire offers high-paying jobs for people with advanced degrees in computer science or with knowledge of robotics, and entry-level jobs that pay $12 an hour or more, the industry also employs temporary manual laborers, who don’t work for the major corporations whose products are in the warehouses, or the logistics companies that run the warehouses. They’re employed by labor agencies that supply workers to serve big-box retailers and their contractors. Most of the striking workers are what are known as “lumpers,” manual laborers who load and unload products from trucks and containers. Usually, such workers make $8 per hour, the minimum wage in California, although according to WWU and the NELP report, workers’ pay at the Mira Loma worksite dips below the minimum wage due to a “piece-rate” system set up by temp staffing agencies in 2010. It is alleged that under this system, workers received pay only for shipping containers or trailers that were completely filled or unloaded by the end of a shift, with no regard for hours worked or other work performed, in violation of state law.

In 2011, California’s Department of Industrial Relations (DIR), the state labor department, fined the two staffing companies at the Mira Loma warehouse hundreds of thousands of dollars for wage and hour violations.

One staffing firm, Impact Logistics Inc., was fined $499,000 for not properly providing itemized wage statements to the over 200 workers who loaded and unloaded Wal-Mart products into the warehouse facility. Impact was also issued a warning for neglecting to maintain time records.

Premiere Warehousing Ventures was slapped with fines that totaled over $600,000 after state inspectors discovered that the staffing agency had engaged in multiple state wage and hour violations, including denying employees overtime compensation. According to the DIR, the company neglected to provide employees with proper wage statements, and failed to let them see their payroll records, as required by state and federal law.

Warehouse Workers United does not represent the workers officially, but it helped coordinate the September march, because it contends that Wal-Mart established a system of multiple subcontractors and temporary staffing agencies to thwart union organizing, Brennan said.

As of Sept. 24, 2012, the 30 or so warehouse workers who walked out of the Mira Loma warehouse have returned to the worksite to man picket lines. As of press time, they have not received a response from the warehouse staffing companies or Wal-Mart, according to Brennan.

Roy Maurer is an online editor/manager for SHRM.


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