Andy: The Tesco Strike Is About More Than Tesco’s Workers

Tesco workers in several stores across the country – including Baggot Street, Ballyfermot, and Finglas in Dublin – went on strike yesterday. Many more plan to join the strike on Friday.

They are protesting management plans to tear up the contracts of some 250 workers hired before 1996.

The pre-1996 hires have somewhat better wages and working conditions than those hired after that date, and Tesco now proposes to cut those wages by up to 20 percent.

One tweet from the pro-strike campaign quotes Mark, one of the workers affected, who sums it up as follows:

“My mortgage, car loan and health insurance are all at risk. We just want to continue to do our day’s work and get on with our lives without this thereat hanging over us. If the company get the pre-1996 crew, watch your backs as it won’t stop with us.”

The workers’ union, Mandate, claims management are trying to intimidate staff by telling them that, by striking, they will lose access to Family Income Supplement and other social welfare payments.

Mandate has asked consumers to “shop with their conscience”, and to not cross the picket line.

Supporting Tesco, the Irish Business and Employers Confederation has said that the company “must ensure the competitiveness and sustainability of their business”.

But there is no evidence that Tesco’s business is unsustainable. The company does not reveal how much profit it makes in Ireland.

But the Tesco group as a whole registered profits of £515 million (€584 million) in the first half of 2016. Dave Gibney of Mandate reckons the current proposed cuts would save the company €700,000 per annum.

Certainly Tesco has form when it comes to dodgy cost-cutting tactics. In 2011, it advertised 218 six-month jobs in Ireland – to be filled through the state’s JobBridge scheme.

The workers received their social-welfare payments, plus a €50 top-up from the Department of Social Protection. The company paid them nothing at all.

In 2015, Tesco group CEO Dave Lewis was paid £4.6 million, including a £3 million bonus. By contrast, the workers whose wages Tesco is now trying to cut are paid just over €14 per hour.

And back in 2013, Tesco was criticised for engaging in extensive tax avoidance, making use of 50 subsidiaries in low-tax locations, including 14 in the Cayman Islands alone.

Tesco is not alone of course in seeking to cut costs at the expense of low-paid workers. Dunnes Stores, for example, have made extensive use of short-term and temporary contracts that deny staff job security and leave them unsure of how much work they will be offered from one week to the next.

In my last column, I talked about the emergence of a two-tier labour market in Ireland, with a small, but growing, number of well-paid workers in sectors such as ICT contrasting with relatively low-wage and insecure work in sectors such as retail.

But perhaps even more important is the shift in the shares of income accruing to wages and profits. Michael Taft has documented how, between 2000 and 2007, Irish wages averaged a little over 44 percent of total national income, which was already a low share by European standards.

Drawing on EU forecasts, Taft expects that share to have fallen below 40 percent in 2017. Because wages in some sectors, especially ICT, are rising pretty rapidly, this means that the burden of this shift has fallen disproportionately on the already low-paid.

As Taft puts it, “The Irish low-paid are ultra-low paid.” And if Tesco gets its way, they will be paid even less in future. Which is why this strike is so important: it is not just about the rights of the workers involved, vital though they are.

It is about the relentless push by corporations to drive down the living standards of their workers wherever they can get away with it, not to ensure company survival but to ensure larger profits for shareholders and bigger pay cheques for senior management.

As the Tesco workers’ slogan puts it, “If you tolerate this … who’ll be next?” Shop with your conscience.