Does Membership Pay?

A recently-negotiated contract between the UFCW and a grocery chain will result in lower wages than Walmart pays. And, of course, Walmart workers don’t have to pay union dues.

The United Food and Commercial Workers Union has long spearheaded the move to organize Wal-Mart, the nation’s largest private employer. Despite years of friendly media coverage, and hundreds of millions of dollars spent (mostly from the forced dues of employees on fixed incomes), the protests have not succeeded in increasing unionization.

The value proposition that unions offer potential members is that they’d be able to negotiate better employee pay than employees could achieve on their own. This view goes largely unchallenged in today’s culture, and declining unionization rates are often pointed to as a factor in the decline of the country’s middle class. But is this view correct or just politically correct?

Consider last week’s agreement between the UFCW and the retail giant Kroger. In a three-year contract that covers 8,500 Indiana employees, the agreed-upon hourly wage rate is $8.50, with a top hourly wage for seasoned employees of $13.90. (These wage rates are before union dues deductions.)

Compare that to Wal-Mart, which the UFCW group OUR Wal-Mart claims exploits employees. Walmart’s starting wage is $9, which quickly increases to $10 after a six month training program… And its top wage for a cashier in Indiana is $17. Kind of undercuts the argument that unions are needed to negotiate “fair” wages.

So who is the winner from unionization contracts like Kroger’s? Crony union bosses, who sell their members the bill of goods that they can negotiate higher pay then pocket the millions of dollars of dues money paid by their members. It’s a scam.

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