Wal-Mart finds union at its back door

JONQUIERE, Quebec -- The signs topping sales racks wear the same yellow smiley face, but promise "Chute de Prix," instead of price rollbacks. The boxes of Tide lining the shelves in housewares come packed with a bonus CD, just for Canadian stores, inviting shoppers to experience "la passion du Hockey."

But except for a few tweaks, the low-slung gray and blue Wal-Mart store off Highway 70 could be almost any one of the retail Goliath's nearly 5,000 discount emporiums in the United States and eight other countries. And that's what worries executives at the Arkansas headquarters of Wal-Mart Stores Inc.

While still not a certainty, the 165 retirees, single moms, students and other hourly workers at this store 2 1/2 hours north of Quebec City could soon become the first anywhere to extract what the world's largest private employer insists its 1.5 million "associates" around the world neither want nor need -- a union contract. A government agency has certified the workers as a union and told the two sides to negotiate.

"One person against Wal-Mart cannot change anything," said Gaetan Plourde, a fiery 49-year-old sales clerk in the store's home electronics department, explaining simmering frustration over the store's pay, scheduling and other practices. "Wal-Mart wants to be rich, but it won't share."

Wal-Mart responds that it does share its cost savings with consumers through lower prices and that it treats its workers fairly. The company has redefined retailing by squeezing its suppliers and keeping a tight lid on other costs, including labor, allowing it to undercut competing stores. That translated last fiscal year into profits of more than $9 billion on sales of $256.3 billion.

It would be easy to overlook events in northern Quebec -- a region separated from the nearest big city by more than 100 miles of thickly wooded mountains seemingly planted with more moose crossing signs than houses, in a province known for its idiosyncratic labor laws -- as purely local.

But it's not. There has been angry name-calling by workers riven into pro-union and anti-union factions and accusations of intimidation by managers and threats of a lawsuit by the United Food and Commercial Workers Union.

And on Wednesday, Wal-Mart, referring to the strife, said the store was losing money and might have to close.

The public jockeying over Jonquiere is also also geared to capture the attention of workers in the United States.

Wal-Mart says the average hourly wage of its workers is $9.96 an hour -- just below the $10 an hour average pay for U.S. discount department store workers and short of the $10.87 an hour earned by the average supermarket employee.

But pay and benefits are substantially better at some unionized food stores. A strike by Southern California supermarket workers -- most making $12 to $15 an hour -- early this year came after grocers sought to cut pay for entry-level workers and shift health-care costs. The concessions were essential, grocers said, if they were to compete with Wal-Mart.

Wal-Mart defends its pay as very competitive, and says its chief concern with unions is that they would get in the way of doing business.

Even if a union gains entry, it will come slowly and make only an incremental difference in Wal-Mart's costs and profits, said Emme Kozloff, an analyst who tracks the retailer for Bernstein Research in New York.