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Tilting at Windmills

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April 11, 2011

WE'RE NOT SUPPOSED TO OFFER THE LOW-WAGE WORKFORCE FOR FOREIGN COMPANIES.... Ikea's labor dispute in Southern Virginia should be a bigger story.

When home furnishing giant Ikea selected this fraying blue-collar city to build its first U.S. factory, residents couldn't believe their good fortune.

Beloved by consumers worldwide for its stylish and affordable furniture, the Swedish firm had also constructed a reputation as a good employer and solid corporate citizen. State and local officials offered $12 million in incentives. Residents thrilled at the prospect of a respected foreign company bringing jobs to this former textile region after watching so many flee overseas.

But three years after the massive facility opened here, excitement has waned. Ikea is the target of racial discrimination complaints, a heated union-organizing battle and turnover from disgruntled employees.

It's quite an ordeal. Workers are forced to work overtime, often with little notice, and those who don't go along face disciplinary action. Workers have been ordered to attend meetings at which management "discourages" them from forming a union, and Ikea has hired a law firm known for its anti-union efforts.

This is apparently front-page news in Sweden, where Ikea is a celebrated and iconic brand, and where the company is known for progressive labor practices. Indeed, most of the Ikea labor force in Sweden is already unionized.

So, what's the problem?

Laborers in Swedwood plants in Sweden produce bookcases and tables similar to those manufactured in Danville. The big difference is that the Europeans enjoy a minimum wage of about $19 an hour and a government-mandated five weeks of paid vacation. Full-time employees in Danville start at $8 an hour with 12 vacation day -- eight of them on dates determined by the company.

What's more, as many as one-third of the workers at the Danville plant have been drawn from local temporary-staffing agencies. These workers receive even lower wages and no benefits, employees said. [...]

Bill Street, who has tried to organize the Danville workers for the machinists union, said Ikea was taking advantage of the weaker protections afforded to U.S. workers.

"It's ironic that Ikea looks on the U.S. and Danville the way that most people in the U.S. look at Mexico," Street said.

Yep, thanks to anti-worker policies in the U.S., we're offering the low-wage workforce for foreign companies to exploit and mistreat.

As Mark Kleiman put it, "It's an old, old story: the customers of a company renowned for decent treatment of its workers in its prosperous home country are shocked to learn of its ruthless exploitation of workers in a less-prosperous country where the laws make it harder for workers to defend themselves. All that's new is that the first-world country is Sweden and the third-world country is rural Virginia."

Steve Benen 3:35 PM Permalink | Trackbacks | Comments (41)

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Comments

This has to be Rachel's front and center story. USA, USA, USA.

Posted by: Ron Byers on April 11, 2011 at 3:52 PM | PERMALINK

Blame conservative "anti-worker policies" instead of Ikea itself.

Great story. Compelling and rich.

Posted by: Ron Burgundy on April 11, 2011 at 3:54 PM | PERMALINK

This SHOULD be a bigger story but why should IKEA treat workers any differently in this country than the Republicans do? They can read the newspapers too...and the GOP has the BALLS to say Obama is lowering respect for us in the world...

Posted by: SYSPROG on April 11, 2011 at 3:59 PM | PERMALINK

I've been boycotting Wal-Mart for years. No reason I can't boycot Ikea too.

Will somebody please let me know when they get their act together? Until then, I won't set foot in their store (I live near their Atlanta location).

Posted by: Chris on April 11, 2011 at 3:59 PM | PERMALINK

No, we must blame the librul media for spreading stories like this. And we must blame the Democrats for their tax-and-spend policies that keep talented individuals and companies from creating jobs.

Why do the Swedish Socialists hate our freedom so much?

Posted by: bleh on April 11, 2011 at 3:59 PM | PERMALINK

"Right To Work" ... for peanuts

Posted by: G.Kerby on April 11, 2011 at 3:59 PM | PERMALINK

Oh, but we're supposed to bow down to the Galtian overlords and be happy to lick the crumbs on the floor that they drop from their table of feasts.

You people should be grateful you have a job! Quit being such a moocher!

This is the new reality for Americans... $8/hr, no benefits, forced overtime, etc etc.

It's not like you have lives or families, right? You're just supposed to work work work all for us, and maybe you'll get a $10 gift certificate to McDonalds at Xmastime for all your hard work.

Posted by: ScrewIsJonGalt on April 11, 2011 at 4:02 PM | PERMALINK

I, for one, welcome our new Swedish overlords.

Those virginian slackers need to wake up and smell the lutefisk.

Posted by: Snarki, child of Loki on April 11, 2011 at 4:03 PM | PERMALINK

This is exactly what the GOP (Geriatric Oligarchs and Plutocrats) wants to happen in our country.

The richest of the rich pay no taxes. The rest of us pay but get nothing back from it. Keep the workforce dumb, poor and desparate and turn us into a 3rd world country.

That's the goal. Sad part is, it's more than likely going to happen.

Posted by: Mitch on April 11, 2011 at 4:04 PM | PERMALINK

If you are going to have an uneducated workforce, this is the result. This anti-educational attitude of politicians (and the public) was decried by AZ Business Leaders on 31 March who said AZ needed a better educational system. My Toon showing kids boiling in the pot of of the business world has a business person saying"link: Tragically, they graduated from the Arizona School System, it's about all they're good for..." illustrates this.

Posted by: KurtRex1453 on April 11, 2011 at 4:08 PM | PERMALINK

Welcome to your new 3rd World Banana Republic -

AmericanBananistan!

Posted by: c u n d gulag on April 11, 2011 at 4:11 PM | PERMALINK

Ikea: Cheap press board shit that falls apart when exposed to water. Why anyone would waste their money on it is beyond me. Must be the groovy made up ferign soundin' words .

Posted by: John R AKA Mr. Serf Man on April 11, 2011 at 4:16 PM | PERMALINK

As we race towards becoming a banana republic, this must bring smiles to the republicans' faces. Greed above everything else is all that matters. Don't look to Geo. Allen for sympathetic action, or thinking.

Posted by: Ted76 on April 11, 2011 at 4:20 PM | PERMALINK

I am so glad Rachel keeps up with your blog, I agree with Ron Byers she should and, I believe will, cover this story. I live in Northern Virginia which is a different world than rural Virginia due to many businesses, government workers and tons of government contract jobs at private businesses. Still, all you have to do is donate clothes or household goods to Amvets Thrift Store in Alexandria to come face to face with incredible poverty and substandard education.

Maybe this will wake up some rural folks to the state of this country. The Tea Party and conservatives love to mock Sweden and other European countries, now we're their low wage flunkies. Prayers, hunting and church going have their place but they can't provide you dental/health care, a decent paying job, college for your children, a safe old age free of worry and fear. If even just a few wake up, that's a bit of progress.

Posted by: Kathryn on April 11, 2011 at 4:21 PM | PERMALINK

The first thing to solve the problems would be to shutdown 95% of all MBA granting universities.

Posted by: samsa on April 11, 2011 at 4:30 PM | PERMALINK

Let's all sing together:

Proud to be an American
Where at least I know I'm cheap

Posted by: Vince on April 11, 2011 at 4:42 PM | PERMALINK

[Please don't respond to "Concerned" or "a moderate" because they are the same person and he or she has been banned on multiple occasions. We suspect that it is being paid to troll liberal sites to derail conversation and dialog, and we remove the comments it posts in case payment is on a "piecework" basis.]

Posted by: Concerned on April 11, 2011 at 4:43 PM | PERMALINK

At least Danville folk aren't -- yet -- cowed enough to just tug their locks and say "yes, sir; whatever you say, sir"; they're fighting back. And they've been fighting back all along; they'd done their damnedest to reelect Periello, despite being an atypical demographics for Dems.

Posted by: exlibra on April 11, 2011 at 4:43 PM | PERMALINK

This, to me, was the most telling line:

The plant has been run mostly by American managers, along with some from Sweden.

In that one statement, it's clear that IKEA relinquished HR policy-making to its US management staff, who are well accustomed to this sort of style. While I doubt very much would be different with an all-Swedish management team, clearly much of the blame for this situation lies with the folks IKEA hired in VA to manage this plant, and with the slaveholding - er, management - philosophy popular in the US of late.

What I don't understand is why anyone should be surprised. This is little different from BMW, Nissan and Toyota opening plants in the US (particularly in the Right-to-Work South) and paying less than half what workers for the Big Three earn with correspondingly lower benefits. This is no different from conditions at Tyson Foods, or DeCoster Eggs, or Walmart, and no different from the sort of moves West Point and other textile makers pulled before hopping offshore altogether. The only difference here is that the employer still claims to hold the sort of respect and value for its employees that US firms claimed forty or so years ago - and that sentiment in US industry is long gone.

As for the political fallout, if VA were serious about employing its people - and keeping business at home - they would have found a way to keep companies like Hooker, Thomasville and Furniture Brands International around rather than let them close up shop and then spend millions attracting an IKEA sweatshop.

Posted by: boatboy_srq on April 11, 2011 at 4:45 PM | PERMALINK

Thise folks in VA should look for a job offered by the US Government. What were they thinking?
Posted by: Concerned on April 11, 2011 at 4:43 PM

I know you're nothing but a BS-fed troll (saw you being removed from other threads), but I'll take your question on face value and answer it anyway:

What they were thinking is that, in a small town, rural, Southwestern Virginia, there aren't many federal Government jobs to be had. And the *state* Govt jobs go to shit-spewing flacks like yourself, because that's who's in power there. That's why they take what's offered, even when what's offered is on a par with what's offered in third world countries (they earn more, but they have to spend more, on basics such as room, board, health etc. It evens out).

God help them, they want to live, and to live, they have to eat.

Posted by: exlibra on April 11, 2011 at 4:54 PM | PERMALINK

I've been boycotting Wal-Mart for years.

How's that workin' out for you? Brought 'em to their knees yet?

Posted by: chi res on April 11, 2011 at 4:57 PM | PERMALINK

That's the plan.

Turn us into a third world, ag-based, natural resources yielding third world country. It was the plan when GHWBush became president (planned out by the then G-7) and leave think-work to Europe and Asia. The rest of the world is just a pile of natural resources --including the human ones.

You reported on the Boehner memo regarding how to drive US wages waaay down by firing government employees.

Time to headline this.

Posted by: jjm on April 11, 2011 at 4:58 PM | PERMALINK

I don't know what the big deal is. The plant management is paying themselves less than half of what their Swedish counterparts are making, right?

Posted by: Algerine on April 11, 2011 at 5:04 PM | PERMALINK

@chi res

Not sure what your point is about Chris boycotting Wal-Mart.

I haven't shopped at Wal-Mart in nearly a decade. Have I brought them to their knees? No. But neither have I given them any of my hard earned cash.

Doing what's right should not require tangible benefits. We do what's right simply to do what's right.

Posted by: Mitch on April 11, 2011 at 5:17 PM | PERMALINK

Virginia, like most of the South, is a right-to-work State. IKEA deliberately chose a state which is anti-union to begin with so why the shock that they are mistreating their U.S. employees. You will notice that they didn't pick on New York or Massachusetts for the place to build their plant.

Posted by: VERBERNE on April 11, 2011 at 5:17 PM | PERMALINK

And so it begins. It has been going on under the radar but , like decomposing bodies, eventually surfacing smellier than when they entered. It's like finding out that there is no Easter Bunny or Santa...

Corporations pay no taxes, exploit workers, and spend every waking moment upping the profit margin to keep the holders happy.

Why are any of us surprised at any level with this information?

Stay thirsty my friends...but don't drink the kool-aid. Nauseating...

Posted by: stevio on April 11, 2011 at 5:21 PM | PERMALINK

We do what's right simply to do what's right.

Actually, most people I know who boycott WalMart do it to feel good about themselves, like most people who give to meaningless charities. Which is okay, I suppose, but it does nothing to change the reality of WalMart continuing to screw its employees and drive local businesses out of business. It would actually be more effective if you shopped at WalMart, then took the money that you would have spent by shopping someplace more expensive, and donated it to the folks who are trying to unionize WalMart. Even more effective if you organized all your FB friends and all their FB friends (because I know you're the kind that has lots of FB friends!) to do the same thing. Call if you have questions.

Posted by: chi res on April 11, 2011 at 5:36 PM | PERMALINK

Ikea opens it first store in the Metro Denver area this fall, I think. This kind of publicity doesn't bode well for them.

Posted by: CDW on April 11, 2011 at 6:15 PM | PERMALINK

["Actually, most people I know who boycott WalMart do it to feel good about themselves,"]

Ah yes, argument by anecdote. One of the most common logical fallacies out there. Hey, I can do that too:

* Most people I know who use argument by anecdote do so because they like to be smug and pretend that their experiences give them all the answers.

Posted by: ShadeTail on April 11, 2011 at 6:20 PM | PERMALINK

Good job, ShadeTail! Your usual comments aren't nearly that clever! Must be that whole "logic" thing!

Posted by: chi res on April 11, 2011 at 6:43 PM | PERMALINK

Speaking of John Cole, he had a good post yesterday on this very issue - When the MBA’s Meet IKEA
Damned american MBA management techniques. The comments there are insightful.

Posted by: darms on April 11, 2011 at 6:54 PM | PERMALINK

chi res

Walmart isn't doing well. They went upscale (can you imagine that?) and now are bringing back the cheaper stuff.

Posted by: Maude on April 11, 2011 at 9:10 PM | PERMALINK

I must admit I frankly thought it would take longer for the US to become the source of low-wage workers for the world while India, Brazil and China become the primary sources of consumers... the US: Land of Have Yachts v Have Nots.

Posted by: PEA on April 11, 2011 at 10:04 PM | PERMALINK

Yes, Rachael Maddow does keep up with the blog of Steve Benen, as Steve keeps up with RM's excellent program. That said, I'm sure Steve will lead, in the morning, with her criticism of the Obama Administration selling out the women of DC in Friday's night "Victory". They fought to retain Planned Parenthood, but, let the RepuGs strip the DC women of their right to city funds. In addition, I'm sure Steve will write a thread about RM's comment that Obama caved from early on and let the RepuGs have far too much in cuts. This at a time when our nation needs to have more money spent to generate jobs.

Posted by: berttheclock on April 11, 2011 at 10:09 PM | PERMALINK

Aren't maquiladoras wonderful?

Posted by: pj in jesusland on April 11, 2011 at 10:25 PM | PERMALINK

Ikea is a large multinational corporation with all the usual questionable practices. To think that this is an American management issue is laughable. I am sure they are not paying great wages at their factories in Vietnam, China or wherever either. Ikea came to Danville not only because they offered low cost labor-- they also received an incentive package worth 12 million dollars of taxpayer money. I would also like to note that Ikea has gamed the system in their own country so that they do not pay income taxes.
I don't boycott IKEA per se, but I do have a real problem with this idea of disposable furniture (made with illegally harvested wood), so I won't be shopping there.

Posted by: Kat on April 11, 2011 at 10:49 PM | PERMALINK

Who ya goin' to call? To bust ghosts, you call "Ghostbusters". To bust any thought of unions, you call Jackson Lewis. Ninty three percent of their work is representing corporations against employees and unions. Out of White Plains, NY, they have offices nation wide.

However, concerning W*M, Tilda rice from England is superb. Unfortunately, in Portland, the pricey rice was dropped by Safeway. Only W*M is listed for carrying Tilda. I'll pass and order from Amazon. No, chi res, the best way to stop W*M is to boycott them. Quit giving money to Beijing/Bentonville.

Ah, IKEA, where you buy their products and attempt to put them together using their instruction manual which was translated by a first year English student in Outer Mongolia. I wish Swen Larson was still alive to expose the Danville plant. Perhaps, Mankell can have Wallender drop over to America for a visit. Mankell would love to show their hypocrisy.

Posted by: berttheclock on April 11, 2011 at 10:52 PM | PERMALINK

And what exactly is the surprise news in this article? After 30+ years of neocons going wild it rather seems like a miracle US children still are allowed to go to school instead of being forced into factories.
But they're working on it.

Posted by: Vokoban on April 12, 2011 at 3:52 AM | PERMALINK

Ikeas products suck. Who would buy their cheap crap anyway?

Posted by: bandit on April 12, 2011 at 8:55 AM | PERMALINK

@chi res

You said: "It would actually be more effective if you shopped at WalMart, then took the money that you would have spent by shopping someplace more expensive, and donated it to the folks who are trying to unionize WalMart. Even more effective if you organized all your FB friends and all their FB friends (because I know you're the kind that has lots of FB friends!) to do the same thing. Call if you have questions."


No. I shop at small local stores and farmer's markets, there's a Mom and Pop store that I do most of my shopping at. Yeah, I pay about 20% more than if I shopped at Wal-Mart, but at least I know that my money is going to a hard working family and their employees in my town.

Also, I don't have a Facebook. You don't know me, so don't act like you do. You seem to really enjoy being sanctimonious and judgmental. Keep it up! It kinda makes me laugh.

Posted by: Mitch on April 12, 2011 at 3:08 PM | PERMALINK

Quote: (Posted by: bleh) "No, we must blame the librul media for spreading stories like this. And we must blame the Democrats for their tax-and-spend policies that keep talented individuals and companies from creating jobs."

I certainly hope you are joking. This is not about Democrats and Republicans or liberals and conservatives. What is stopping the creation of jobs is that he government is PAYING companies to ship jobs overseas. GE made record profits last year, paid no taxes, and was paid $15M in tax benefits, in large part due to these job-exporting incentives.

History shows a strong correlation that when taxes on the wealthy and the corporate sector are reduced, recession follows. The rich and the corporations make more use of the infrastructure created by tax dollars than anyone else, but they want the rest of us to pay the bill. This is absolutely untenable and if the trend continues, this country is done as the great superpower. We are already near the top of the list of developed countries for wage inequality (Iran and Mexico compare favorably to us) and that's just going to get worse as long as we let the top 1%'s war on the lower classes continue.

Posted by: Stu on April 12, 2011 at 5:18 PM | PERMALINK
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