NEW YORK — Target is having labor pains. Until recently, the Minneapolis-based discount retailer largely had avoided the labor disputes and public relations challenges that have plagued Wal-Mart, the world's largest retailer. But now Target could face the same union opposition as its much bigger rival.
Target had its first union election in two decades in June amid allegations by workers of skimpy wages and reduced hours at a Valley Stream, N.Y., store. The measure ultimately failed after Target suggested to workers that the store might not survive if they vote to unionize. But the labor dispute — and Target's handling of it — is widely seen as a precursor to a bubbling national battle between Target and labor groups similar to the one Wal-Mart has been locked in for at least a decade.
"There is no question that this is becoming a hostile, caustic battle of wills," says Don Schroeder, a Mintz Levin labor attorney who has represented corporations in labor battles for 18 years.
While Wal-Mart remains the biggest target for labor groups as the largest U.S. private employer, unions are increasingly setting their sights on Target, as it adds locations across the country and aggressively expands into the heavily unionized grocery business. More labor disputes are expected in big cities such as San Francisco, Seattle and Minneapolis, where Target is based and is the second-largest employer behind Mayo Clinic.
The opposition is coming at a particularly vulnerable time for Target, which is grappling with slack sales growth as shoppers are pulling back amid the painfully slow economic recovery.
The United Food and Commercial Workers International Union's Local 1500 New York chapter, which organized the election in the Valley Stream store, intends to contest the election results and ask the government to order a new one because it says Target intimidated workers. It also plans to fight to get all 26 stores in the New York area unionized.
And the UFCW's Local 1189 in St. Paul, Minn., near Minneapolis, is using the New York election as an impetus to recharge its campaign, which failed a couple of years ago because it didn't collect enough votes. The chapter is organizing a group of people to go door-to-door to almost 2,000 Target workers in four stores. It's also planning to reach out to UFCW's Chicago, San Francisco and Seattle locals to enlist them to join the battle.
"I was inspired. Once we heard that Local 1500 (in New York) had been building toward an election, we thought we better ramp it up," said Bernie Hesse, director of special projects at UFCW'S St. Paul chapter.
Target declined to comment on its strategies to counter an escalating labor fight, but spokeswoman Molly Snyder said the company does not intimidate workers or have any "companywide efforts to restructure or reduce hours."
"Our emphasis is on creating a workplace environment where our team members don't want or need union representation," Snyder said. "Target works to create an environment of mutual trust between Target and our team members — an environment that promotes listening, responding to concerns of team members and always giving honest feedback."
How Target handles the new scrutiny will be critical, analysts say. They say the union battle in Valley Stream exposed how a still harsh economy has pushed Target to compete better with Wal-Mart and copy the retailer on all fronts — including wages and benefits.
During the past year, Target has followed Wal-Mart by shifting more of its workers to part-time, analysts say. Some employees say their hours have been cut from 30 a week to fewer than 10. Part-timers must bank at least 20 hours a week, on average, to qualify for benefits.
Tashawna Green, 21, who started working at Target's Valley Stream store a little more than a year ago, said she voted in favor of organizing because her weekly hours have been cut from 30 to a little more than 20 during the past year. She recently got an 8-cent raise added to her $8 an hour pay — an increase she says isn't satisfactory.
"I can't live off this," said Green, who has a 6-year-old daughter and lives with her aunt. "The 8-cent raise is like a slap in the face. We're just looking for more respect."