Ronald Rhoades and his fellow welders formed a union in October of last year, worried about unsafe rigging, crowding and other conditions at the shop in Morton, Illinois, where they built tractor decks.
But by early 2022, the group of about 20 were out of their jobs.
The company, G&D Integrated, had closed the factory, saying it had suddenly lost its decade-old contract with a Japanese company, workers said. The welders saw another motive: retaliation for the union effort.
“They’ve been building these decks for over 10 years,” said Rhoades, 46. “And then two months after we organize, they’re taking everything away from us.”
The welders filed complaints about the closure to the National Labor Relations Board, part of a sharp increase this year in worker grievances alleging retaliatory shutdowns and other illegal anti-union activity. Overall the numbers are still small, but organizers say store closings are one way companies have tried to tamp down union drives amid post-pandemic worker frustration and rising economic pressure.
G&D Integrated denied it violated labor laws.
“The Company denies the charges that were filed, and has cooperated with the NLRB in its investigation of these unfounded allegations,” spokesman Curt Fisher said in a statement, noting that “no findings of any violations have been issued.” The case is still pending.
When asked specifically why the shop had been closed, Fisher responded by email, pointing a reporter to the company’s statement.
The issue would most likely have remained under the radar but for the rise in similar complaints following store closings at some of the nation’s most prominent companies. Starbucks closed multiple stores this year following union activity. In Maine, bosses shuttered a Chipotle outpost that was on track to become the first to vote on a union.
This week, NLRB officials sided with Starbucks workers in Ithaca, New York, finding the company had violated multiple labor laws during the closing of a store there. And in a separate complaint, they agreed with workers in the Chipotle case, saying the company had unlawfully closed the store and laid off employees to discourage organizing. In both cases, officials asked that the companies reopen the stores.
A spike in anti-union closure complaints
So far this year, workers have filed 34 unfair labor charges under the legal category for complaints about retaliatory shutdowns, relocations and work subcontracting, according to an NBC News analysis of NLRB data. (The NLRB doesn’t isolate shutdown data specifically.) That number more than doubled from 2021, NBC found, and jumped about 80 percent from 2017-2019, the three years before the pandemic, when complaints ranged from 16 to 23 annually.
That rise comes as worker complaints about unfair labor practices more generally were up 19 percent as of September, compared to the same period in 2021, according to the NLRB.
Many businesses say the closings are not directly related to union efforts but reflect new financial constraints in the economy. Trader Joe’s, for example, abruptly closed a wine shop in the center of New York City where workers had been organizing. Spokeswoman Nakia Rohde said the Manhattan closure had nothing to do with the organizing and that the wine shop was one of its “least profitable stores.”
Chipotle said that the closure in Maine also had nothing to do with union activity at the store and that the company respected its employee’s rights to organize. A store in Lansing, Michigan later voted to unionize with the Teamsters.
“Our operational management reviewed this situation as it would any other restaurant with these unique staffing challenges,” Laurie Schalow, Chipotle’s chief corporate affairs officer, said in a statement.
The vegetarian food maker Amy’s Kitchen, which closed a Bay Area factory in July after employees and a local union filed charges of unfair labor practices, said its costs had gone up significantly. Spokeswoman Felicia Collins said that the facility was losing more than $1 million a month, and that the tight labor market, supply chain backlogs and rising prices of goods, like sunflower oil, had made business tough.
“We unconditionally respect our employees’ rights and freedoms regarding unionization,” she said in a statement. “While this was a difficult decision, it was necessary for the business so we could continue to support the rest of the company.”
Like many other aspects of labor law, closure violations can be hard to prove and enforce. Employers are forbidden from explicit retaliation for unionizing but are allowed to close stores if the legitimate economic consequences of unionization force it. And there aren’t significant financial penalties for companies even when they are found to have committed wrongdoing: Companies have to pay back wages for dismissed employees, minus any income those workers earned in the meantime. In rare cases, companies can be required to reopen a closed location.
“It’s almost impossible to get a smoking gun,” said John Logan, a San Francisco State University historian who has written extensively in support of labor rights.
Grease traps
At Starbucks, the poster child for the current organizing uptick, the closing of stores with union activity has been particularly pronounced. Workers at more than 315 stores held union elections in the last year, with a wide majority — 80 percent — voting in favor.
But Starbucks has pushed back forcefully –– aided by the law firm Littler Mendelson, which states on its website “we excel in union avoidance” –– prompting workers to file hundreds of unfair labor practices complaints to the NLRB.
Starbucks announced the closure of at least 19 stores over the summer, mostly in urban areas, citing safety issues. More than 40 percent of the stores had union campaigns, according to data from Starbucks Workers United, the union that has been organizing the workers. Meanwhile, stores that have filed for union elections, including the more than 250 stores where workers have voted to form unions, make up less than 4 percent of the companies’ approximately 9,000 corporate-owned stores.
“It’s because we had such a loud voice,” said Evan Sunshine, 20, a student who worked at the Ithaca store, which abruptly closed in June. “They wanted to turn us into an example to crush any other efforts.”
In an email to NBC News in October, Starbucks said that it had closed 29 stores since July, and that fewer than a quarter were unionized.
More broadly, workers have filed 402 unfair labor charges against the company, alleging retaliation like firings, write-ups and other discipline for organizing work. NLRB officials have so far issued 45 complaints, in which they found merit in 149 of these charges, spokeswoman Kayla Blado said. Those complaints, except for two that judges have already ruled on, will be heard by administrative law judges at the NLRB.
Starbucks has denied union busting in Ithaca or at any of its stores. “We have and will continue to follow the established law and the NLRB processes for all negotiations. We respect our partners’ voices and their right to be represented by a union,” the company said in part in a statement from spokesman Andrew W. Trull. “When we close stores, it is done with deep care and urgency, our goal is to ensure that every partner is supported in their situation.”
At its Ithaca store, Starbucks cited issues with the facility in a memo to workers in June, including a lack of enough ice bins and a faulty grease trap that dated to the previous tenant of the building, according to a copy reviewed by NBC News.
Workers at the store had been the ones to raise the alarm about the grease trap in the first place, two of them said. They had even staged a one day strike — the first by workers at the company — over the issue in April. And the ice bin issue had been resolved months previously, they said.
Workers said seeing those issues as a reason for closing the store made them feel like the company was using their work against them. They said the store, on a busy corner across from Cornell University, was clearly profitable, according to Sunshine.
“None of us thought they’d do it,” 22-year-old Nadia Vitek, another worker at the store, said. “They admitted to us that profit had nothing to do with the closure. … The reasons didn’t really make sense to me. I don’t see how it could be anything other than retaliation.”
Starbucks did not respond to questions about the Ithaca store’s financial stability.
The NLRB is asking the company to reopen the location.
A timeless tactic
Jennifer Abruzzo, the general counsel for the NLRB, said in an interview that illegal threats of plant or store closings had been found to be one of the most effective tactics at quelling union activity and that it was one of many the board sought to regulate.
Shutdowns serve “as a reminder to employees that every time that they try to improve their working conditions, they’ll be met with complete destruction of their livelihood,” Abruzzo said.
Logan, the historian, said closing stores that are unionizing has contributed to the offshoring of domestic jobs in recent decades, particularly in sectors like manufacturing, as companies have sought cheaper labor abroad.
“For several decades the threat was always like, ‘We’ll move the plant to Mexico or some other low wage country if you guys form a union,’” he said.
A Cornell University study in the years after the 1996 North American Free Trade Agreement found that employers made threats to close all or part of a facility in the event of a union win in 51 percent of union campaigns. In industries where jobs could easily be moved overseas — manufacturing and call centers, as opposed to nursing homes, for example — those threats were made in 68 percent of campaigns.
“It’s not magical or mysterious. It’s quite strategic,” said Jane McAlevey, a veteran organizer and fellow, at the University of California at Berkeley.
‘We were going to vote yes, no matter what’
Workers at shops that were shut down said the resulting job losses were crushing.
In Augusta, Maine, after Chipotle closed its store on July 19 — the same day a federal hearing was scheduled on the vote to unionize –– workers accused the company of blacklisting them from getting other jobs at Chipotle.
Brandi McNease, 38, a leader of the Augusta organizing effort, said she believed she had been blocked from applying for other jobs on the company’s jobs site. She kept getting a message that her password needed to be reset, but the email to reset it never came.
She says she was only able to apply for a job after making a new profile with a different email address on the site. And even then, she said she was told by a hiring manager that someone at the company had said that she was not supposed to be rehired.
“Chipotle brought in $7.5 billion last year during Covid. But they are so unwilling to let 18 people have a say in one store,” McNease said.
NLRB regional director Laura A. Sacks wrote in the complaint issued Thursday that Chipotle refused to rehire McNease because of her involvement in organizing in another violation of labor law.
Chipotle did not comment on McNease’s claims about her job application.
Rhoades, the welder in Illinois, said the closure of his shop was “devastating,” sending him and his co-workers scrambling to line up other work after a decade of stability. Still, he doesn’t regret their efforts.
“Somebody was going to end up getting killed if we didn’t get some stuff fixed,” he said. “Every worker deserves some kind of representation.”