Hey Santa, IKEA is anti-union.

by on December 23, 2010 · 10 comments

in Civil Rights, Labor

Editor: Thinking about buying some IKEA furniture for Christmas? Think again. Read this.

KEA Knocks Down Labor Rights

by Phil Mattera / Dirt Diggers Digest

When my colleagues and I at Good Jobs First introduced the Subsidy Tracker database recently, our hope was that the information would be helpful to a wide range of campaigns for economic and social justice. I can now offer one particular use.

By plugging the name Swedwood into the search engine, one finds that the company received a $1 million cash grant under the Virginia Investment Partnership program in connection with its vow to invest $281 million and create 740 jobs. Actually, this grant was just part of a series of subsidies worth a total of $12 million that Swedwood received from the state (the data in Subsidy Tracker are not yet comprehensive).

Swedwood is significant because the company, a unit of the retail giant IKEA, is at the center of a controversy over its labor practices at a furniture plant in Danville, Virginia for which it received the $1 million subsidy. Employees of the facility, fed up with dangerous working conditions and discriminatory employment practices, have been trying to organize with the help of the Machinists union, which produced a report concluding that the Danville operation may be the most hazardous furniture plant in the country. Swedwood and its parent have responded to the organizing drive by harassing union organizers and firing union supporters.

The Machinists and the Building and Wood Workers International labor federation have launched a campaign to pressure IKEA and Swedwood to respect the rights of the Danville workers. Among other things, the campaign is asking supporters to send a holiday card to IKEA Chief Executive Mikael Ohlsson with instructions on how to build a fair collective bargaining relationship with the workers (allen wrench not included).

The unions might also want to make an issue of the fact that a company that was generously subsidized with taxpayer funds is now flouting labor laws.

The financial assistance IKEA got in Virginia is not the only time it has played the subsidy game. In places such as Tempe, Arizona and Frisco and Round Rock in Texas, the retailer has received millions of dollars in sales tax rebates and infrastructure assistance to help finance new stores. It is expected to receive up to $18 million in subsidies for the store it is building in Centennial, Colorado.

In fact, tax avoidance is at the center of IKEA’s entire corporate structure, a complex arrangement that puts nominal control in the hands of a Dutch private foundation but allows founder Ingvar Kamprad and his family to dominate the company and grow wealthier from it (according to Forbes, Kamprad is the 11th richest person in the world, with a net worth of $23 billion).

IKEA is a prime example of how companies that have reputations for being socially responsible somehow get away with exploiting the system of economic development subsidies and with being hostile to unions in the United States – while cooperating with them in countries (such as IKEA’s native Sweden) where they are well established and protected. In the past, IKEA has relied on paternalism – including better than average employee benefits – to discourage unionization at its U.S. operations. The events in Danville suggest a troubling turn toward heavy-handed union busting.

Perhaps this will begin to change the view of corporate social responsibility arbiters such as Ethisphere magazine, which lists IKEA as “one of the world’s most ethical companies.” While the idea of corporate ethics is an oxymoron, companies should not be singled out for praise of any kind if they deny the rights of their workers to organize.

Note: The Dirt Diggers Digest index of information sources featured or utilized in the blog has finally been brought up to date.

Note: Go here for the original article for all the great links which we’re too busy or lazy to install.

{ 9 comments… read them below or add one }

Frank Gormlie December 23, 2010 at 12:18 pm

Tip o’hat to nunya at politickybitch !


dave rice December 23, 2010 at 2:24 pm

Interesting…and the author makes a good point about the generally positive image IKEA enjoys in the media – hell, they were even praised specifically by Michael Moore in his Julian Assange open letter the other week…


annagrace December 23, 2010 at 4:57 pm

The meatballs? Or the furniture?


nunya December 23, 2010 at 3:56 pm

thanks love :)


OB Dude December 25, 2010 at 9:59 am

Maybe Moore, 60 minutes, another film maker can expose the hazardous working conditions…to get the work out to Americans on IKEA’s practices and put some pressure on to make changes. So why hasn’t OSHA been called into these hazardous factories? I guess one positive point is that the jobs aren’t in China????? Personally, I have never bought anything from IKEA. Walking into a mega store like this is not my bag.


OB Dude December 25, 2010 at 10:00 am

Oops not the “work” out to Americans but rather the “word” :-)


ExEmployee January 4, 2011 at 2:13 pm

I use to work for Ikea, I left without looking back mere weeks after being hired. Managers and supervisors were shockingly unprofessional, pay was minimum wage and job duties were unrealistic. I have worked at the lowest rung for multi-nationals before but Ikea was by far the most intolerable.


Jon January 4, 2011 at 3:31 pm

This is an old article from Mother Jones, but I thought it was another interesting angle on this story. I don’t shop at IKEA because all their furniture breaks after 2 months, and their hot dogs taste like particle board.


Earth to IKEA
What that Poäng chair really costs.

— By Kiera Butler

12 Comments | Post Comment
May/June 2009

FURNITURE USED to be an investment, meant to last a lifetime. But thanks in no small part to IKEA, that’s changed. Now we buy bookshelves for $19.99—and feel fine about throwing them away two years later. In her forthcoming book, Cheap: The High Cost of Discount Culture, Ellen Ruppel Shell chronicles how the Swedish furniture giant crafted the message that furniture can be affordable and adorable and sustainable. “With its focus on sharp design and Scandinavian élan, its hip, irreverent television commercials, its conspicuously progressive outlook,” she says, “IKEA appears to be the anti-Wal-Mart, a classy, high-minded company where value and good values coexist.” But do they? IKEA is now the world’s third-largest consumer of lumber after Home Depot and Lowe’s—and though it likes to tout its sustainable harvesting program, the responsibility of policing the logging has fallen on just 11 forestry monitors. As Mother Jones has reported, up to 25 percent of IKEA’s furniture is made with wood culled from the vast forests of northern Russia—an area notorious for illegal logging—and milled in China. There’s just too much to keep track of, as one monitor admits in a company report: “It’s not possible to be everywhere all the time.” The larger point is this: When IKEA says its wood furniture is made from a “renewable material,” it reinforces the idea that disposable is okay.


knowit June 2, 2011 at 9:21 am

Know what true colors ikea is about. People think walmart is a handful, hugh! Mauism has met its brother in arms. This is a true funk , or should we say stench of capitolism. A company that has reformatted itself, begining several years ago, in order to fit with the American corporate lifestyle. The ceo’s & shareholders do very well with this restructred format. The stores are ltd. holdings and allow for multiples of loopholes, in Canada both federal and provincial. This keeps lay store workers, not mid to upper mngt., hungry for hrs. (no such thing as regular pt let alone ft) and no more living wages. The employees that make a decent living are the top level management and related paper pushers. This is the new and improved ikea.


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