What’s Lost in the Market Basket Stories
The saga that has unfolded at the New England grocery store Market Basket over the past few weeks has struck a nerve, and rightly so. As many others have pointed out, the story of a corporate board taking steps to squeeze customers and employees in order to generate ever-higher profits feels far too representative of the way most businesses operate today. What fewer have come out and said: it doesn’t have to be this way.
For the uninitiated in this story, Market Basket is a supermarket chain with 71 stores in Massachusetts, Maine, and New Hampshire. The company employs about 25,000 people throughout the region and had $4.6 billion in revenue in 2013. The chain is an unabashed success, having grown from a small family store to a regional powerhouse. And they have succeeded by taking a distinctly high-road approach: the company takes care of its workers, paying decent wages, offering benefits to full- and part-time staff, and providing employees with a profit-sharing plan. At the same time, Market Basket still offers prices lower than its competitors, Walmart included.
This take-care-of-your-customers and value-your-workers philosophy has given Market Basket an intensely dedicated following, both from employees and regular shoppers. Thus, it should not be surprising that when the controlling members of the chain’s board fired the company’s beloved CEO, allegedly so that they could cut back on compensation, maximize payouts to shareholders, and potentially liquidate the company, the Market Basket faithful revolted, with workers walking off the job and customers boycotting.
Full disclosure, I am a Market Basket acolyte. My family shopped at Market Basket for years when I was growing up in New Hampshire. I remember weekly trips in which the assistant store manager would step onto the cashier line to bag our groceries while chatting with my mother, seemingly just because he enjoyed interacting with customers. He genuinely seemed to love his job.
Indeed, the fact that so many Market Basket employees would risk their livelihood in defense of their former CEO says a lot about the company culture he created. Regardless of how one views his role in the family feud that precipitated the current chaos, we can still acknowledge that Arthur T. Demoulas was certainly well-liked and, at least in part, a shrewd businessman. Part of what has made Market Basket successful is its compensation practices and strong commitment to promoting from within—giving the company low turnover rates and a deep institutional memory that has helped them turn higher profits than their competitors despite offering lower prices.
And while we can celebrate a company that has utilized smart labor practices to achieve success, there are elements of the Market Basket work environment that need not be exceptional. We should not have to rely on a CEO’s benevolence to ensure that anyone’s job is a “good job.” Yes, there will always be some jobs that are better than others, but we can set labor standards that improve the quality of all jobs, and enact policies that put workers in a better position to negotiate improvements in their individual job.
What might this entail? For starters, we could guarantee workers commonsense benefits like paid vacation and family leave. We could update overtime rules to ensure that ordinary workers get overtime when they work more than 40 hours per week. We could build public retirement programs accessible to anyone not offered a retirement plan through their job. We could raise the minimum wage back up to where it provides at least enough for someone to survive without relying on public assistance. We could strengthen labor laws so workers have the ability to organize and bargain collectively for better pay, benefits, and working conditions without fear of being fired. This last suggestion is particularly relevant, because it has been through collective action that the workers at Market Basket have been able to make their voices heard. If Arthur T. is reinstated as CEO, it will be because of collective action. How many jobs at other companies could have the same benefits available at Market Basket if workers had greater ease of organizing, and protection when doing so?
Even if the ousted Arthur T. is reinstalled as Market Basket CEO, a day will come when someone else is running the company. On that day, we can hope that the new leadership shares Arthur T.’s vision, but we’d be better off building economic structures and labor standards so that workers in any company, under any CEO, can still have a decent quality job.