Monday, January 28, 2008

Tesco and the changing nature of CBAs

Recent developments in California have shown that the CBA concept may be changing. In 2007, Tesco, a British grocery chain and the world’s third largest retailer, announced plans to open hundreds of neighborhood markets on the west coast. A coalition was quickly formed to demand a CBA, primarily because Tesco does not have a unionized work-force.

Tesco has shown no interest in negotiating, despite media pressure and threats of a boycott from community and labor groups. Indeed, Tesco has sought to turn the media attention in its favor, arguing that a CBA is unnecessary because it already provides well-paying jobs, has environmentally-friendly policies and has pledged to locate stores in underserved areas.

The situation is notable because the coalition has relied for leverage primarily on its ability to influence consumers, and not on its ability to provide support in the land development approval process. Tesco does not seem to believe that refusing to negotiate a CBA will interfere with its business, and this underscores a fundamental aspect of CBAs—they may not work when the developer does not that it needs them.

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