Market Basket, Arthur T, and the American Dream
Thousands of angry Market Basket workers have elevated ousted Market CEO Arthur T. Demoulas as close to god-hood as a man can get. More than 5,000 employees turned out to proclaim their loyalty to their former CEO at a Tewksbury rally Monday, double the size of a protest last week.
Arthur T’s firing has provoked a reaction among employees and customers that most Massachusetts unions would be hard-pressed to duplicate. (The Teamsters tried to move in on the action and were promptly rebuffed.) Eight employees went to bat for their ousted chief executive. For their pains, couriers dropped off pink slips at their homes. Arthur T, no fool he, urged the current slate of Market Basket executives to reinstate them.
As Boston Globe columnist Steven Syre notes, “Demands to return the chief executive favored by employees are something new.”
What’s Arthur T. got that many businessmen don’t? Aretha Franklin spells it this way, R-E-S-P-E-C-T. Arthur T was “a man that I would run through a wall for, I have no regrets, I would do it all over again,” said Tom Trainor, one of the fired protest organizers.
Martha Coakley followed suit, which meant that Charlie Baker had to join the chorus. New Hampshire’s Jeanne Shaheen and her nemesis Scott Brown have also weighed in. New Hampshire Gov. Maggie Hassan, who is running for re-election, issued a statement Monday backing the workers. Gov. Deval Patrick, who is not, has yet to say anything about what is arguably the biggest labor protest during his eight years in office.
All of the attendant hoopla obscures a simple fact. Arthur T was something of a dinosaur: a savvy businessman who made sure that his employees shared in the success of the company. By most accounts, Arthur T treated his people right, so right that employees described themselves as family.
Employees get benefits that workers at a corporation like Walmart can only fantasize about: Annual bonuses, profit sharing, and a shot at management-level jobs. The Boston Business Journal’s George Donnelly describes what made Arthur T. unique:
Demoulas has cultivated a strict advantage in the market place. The formula boils down to this: investment in employees – Demoulas pays better than average and has built up a retirement fund of over $500 million for employees. Low prices are a byproduct of many factors, chief among them is the company carries no debt and owns many of its locations.
In short, Arthur T gave supermarket employees at shot at the American Dream. Again from the Globe’s Syre: “It’s all about fears that good, middle-class jobs will be threatened by owners who want to squeeze money out of an established, successful business.”
Workers suspect that their piece of it could be destroyed by Arthur S. Demoulas, the cousin now in control of the family business. The new co-CEOs, Jim Gooch and Felicia Thornton, have not covered themselves in glory. Their actions-firings and public statements that clash with passion on display in the streets- are all playing into an evil, corporate overlords narrative.
Market Basket has customer loyalty that many businesses would die for. But the company continues to ramp up a public relations nightmare that has hard-nosed business gurus shaking their collective heads. The Globe tracked down a fair number of public relations and business experts who intoned that nothing good can come of the current standoff.
With pure, unadulterated hatred between the family factions (paging Dr. Phil) at work, a resolution that will please all sides is highly unlikely. Money talks, but it also walks. As BBJ’s Donnelly concludes, “(Arthur S.) Demoulas should reinstate the fired workers, and listen carefully to what its workforce is ultimately worried about: their futures. Otherwise, Demoulas seems destined to learn the lesson that irrational family behavior will not go unpunished by the market place.”
Correction: An earlier version of this post stated that NH Gov. Maggie Hassan was not running for re-election. Hassan is running for re-election.
— GABRIELLE GURLEY
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