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"A Win for the Virtues of Loyalty and Fairness"

"Strikes don't strike me" was a favorite saying of Catholic Worker cofounder Peter Maurin; but even Maurin might have been pleased with the eight week strike by Market Basket workers and managers that ended yesterday with tears of joy shed at most of the supermarket chain's 71 stores in Maine, New Hampshire and Massachusetts.

It's not just the fact that thousands of Market Basket's nonunionized workers happily went back to work after winning on their one and only demand.  Or that the strike was led by a nine member council of senior store managers who'd all worked for the company for decades.  Or that the workers were supported by a boycott semi-spontaneously organized and adhered to by hundreds of thousands of Market Basket's loyal customers. 

No, what might have pleased Maurin was the workers' solitary demand: the rehiring of fired long-time CEO Arthur T. Demoulas.  When's the last time workers---without the (admittedly meager under current US law) protection of a union contract---went on strike for their boss?

"Artie T.", as Demoulas is known (so as to avoid confusion with his cousin "Artie S.") had led Market Basket through a period of growth and profitability by paying workers well, providing excellent customer service, keeping prices low (underpricing Walmart, among others) and stocking hard-to-find food items prized by the company's many immigrant customers.

For nearly 25 years, the two branches of the Demoulas family have fought bitterly for control over the company their grandparents started in Lowell, Massachusetts back in 1916.  The fight reached a peak on June 23 when the Artie S. board faction fired Artie T. after a long string of disagreements over how to run the company. 

As the US approaches another Labor Day in which the prospects for American workers continue to dim as corporations acquire seemingly ever greater powers, the Market Basket saga is a genuine "feel-good" story that has the local area almost giddy.  (How giddy?  Yesterday, Boston-area pop music stations broke into their regular programming to offer live coverage of Artie T's first public statement since regaining control of the company.)

MIT business professor Thomas Kochan has followed the dispute closely and offers one of the first---and best---of what will be many attempts to read "the signs of the times" and discern what, if anything, the Market Basket dispute---and its resolution---have to offer for the rest of the American economy:

Like everyone else, I am relieved that Market Basket share owners reached a deal allowing Arthur T. Demoulas to lead employees back to work and customers back to their stores. This is a win for all the parties with a direct stake in this company, and for those around the country who watched this saga unfold. Arthur T. got it exactly right in his moving speech to employees this morning when he said this is a win for the virtues of loyalty and fairness that carried employees and customers through this ordeal.

Kochan goes on to thank pretty much everyone involved in the dispute---workers, customers, the media for its coverage, community leaders (including Govs. Patrick and Hassan who helped mediate the settlement, and area religious leaders*) who got involved, and members of the Demoulas family themselves. 

It is perhaps unrealistic to expect that the Market Basket settlement will serve as a model for improved worker-management relations in the US.  But for many around here, it is a bit of light shining in the darkness.  That alone makes it worth celebrating. 

Happy Labor Day.

*Full disclosure:  The organization I work for played a role in generating the statement and press conference from area religious leaders to which Kochan refers.

About the Author

Luke Hill is a writer and community organizer in Boston. He blogs at dotCommonweal and MassCommons. 



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Great story. Let the lovers of Mammom take heed that you cannot serve two masters. Even if your archbishop says you can.

A wonderful story, which I had to follow on WBUR because my computer has a mind of its own, and that is where it happened to send me weeks ago when it all started. I wonder, though, if it would be possible anyplace else. It seems to have worked because grocery workers tend to be more steadily employed at one place than most retail workers and because New England is, well, New England, which means what works there might not work anyplace else except in maybe the Pacific Northwest. And, of course, because Arthur T. is Arthur T.

But, even so, the other nephew and his family are in fat city, and Arthur T. has new partners to answer to, and there really is no substitute for a strong union for most workers -- unless they are in New England or the Pacific Northwest and are in the grocery business and work for Arthur T. And, full disclosure: Nice work, Luke.

Years ago IBM was the best company in quality, profits and the way it treated employees. It was called Mother Blue. When Microsoft blew IBM away with MS Dos, IBM went into a decline So did the way companies treated employees. Bill Gates is making it up now with his strong philanthropy. But the flavor of Corporate America never recovered. Whereas Google treated its emploees well, th general spirit has remained with Greed and less care for people. Bishops like Dolan do not help when they cater to Billinaire employers by builiding outlandish cathedrals without challengng them to treat their workers fairly.

That's great news for workers.  Is there any kind of succession planning/discussions of what might happen one day  at Market Basket after Mr Artie T retires?  

This whole story has been mishandled from the beginning. 

Read the NH coverage here for a better idea of some of the facts of the matter, and the comments below. 

Congratulations to reporter Michael Cousineau for at least giving some background on the reasons for the feud between Arthur T. and Arthur S. The press coverage has focused almost exclusively on a one-sided portrait of Arthur T as a hero. I believe there is much more to the story, which hopefully some outstanding objective business journalist will cover in a book or documentary. The issues are key, which the passage of time does not invalidate.

Here’s a synopsis of the reported record I've read of Arthur T’s side in the dispute:

- defrauded not just “millions,” but $206 million from Arthur S and his relatives; that’s cheating on a very grand scale;

- physically assaulted his cousin during the legal battle;

- attempted to overturn the court verdict by scheming with lawyers to falsely create a mistrial; some lawyers disbarred;

- kept $500 million for working capital earning but 1% interest, even when he acknowledged only $200 million was needed; those profits were belatedly distributed to shareholders this summer

- a group of corporations owned by family members on his side only (wife and husbands of two sisters) sold land to MB where their stores were built by each other) - steering profits through side deals?

- insisted on dictatorial control and objected to the board’s right to review a major $46 million loan; he created his own problems in the end. From the news article:  "I'm running this company with the philosophy, very strong philosophy, that there's only one boss in the company," he said, according to minutes of a company board meeting. "There's not two. There's not three. There's not five. There's only one boss in the company." At another board meeting in 2011, when board members raised questions about a $45 million investment loan, Arthur T. accused them of "nitpicking." That led then-Director Nabil El-Hage to reply: "In my religion, only the Pope is infallible."

He built a very good company, no doubt. But would he have been willing to let 25,000 people lose their jobs, if he did not get his way?

Now, Arthur T is accountable to a private investment firm unlikely to abide such conduct. I hope the company makes it, and Arthur T can meet the new debt service obligations he acquired to buy out his cousin's family shares.

This will be a major case study, and I do hope all the facts are examined.

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