What unions mean for Wal-Mart in the U.S.

Wal-Mart is facing scrutiny more than ever about allowing unions inside its locations in the U.S., and the heat will become even more intense as China becomes an important cog in Wal-Mart's wheel. A few weeks ago, in a surprise move, Wal-Mart was seen bowing to unions in its China locations (owned jointly with Trust-Mart).

Would Wal-Mart see job cuts if it were to unionize its retail locations? That is what several managers who attended mandatory meetings claim. Wal-Mart management clearly does not want the trend of declining union membership seen in the U.S. to reverse. Higher payroll costs and health costs would be a result. Although the U.S. is in the tank at the moment with fuel and commodity costs rising, it's still doing quite well since it is a haven for those wanting to save every penny. So, what's the beef Wal-Mart has with unions? Plain and simple: money. That's it.

One of the meeting leaders observed from a recent Wal-Mart department head meeting was quoted as saying, "I am not telling you how to vote, but if the Democrats win, this bill will pass and you won't have a vote on whether you want a union." The Wal-Mart Supervisor who heard this exact quote was pretty adamant about it. As in, "they're telling me how to vote."

Is it about workers or money?

To those employees who believe a union will "save the day" when it comes to being represented fairly while paying a good chunk of money, more power to you. To those that believe a union will force retailers to cut employees or change its employment practices, more power to you as well. There is a never-ending range of opinions on this one, and there are two business organizations -- including the well-funded Employee Freedom Action Committee -- who have some deep pockets to ensuring some current U.S. Congress legislation aimed at making more unions accessible does not come to pass.

The U.S. Chamber of Commerce is even getting in on the act, as it's been organizing a national effort to lobby members of Congress to ensure no new union legislation makes it through the process. Of course, the AFL-CIO and the UFCW both have stated that passage of existing union legislation is their top priority after the U.S. presidential election in November.

Since union membership has slipped from 15% of privately employed workers 25 years ago to only 7.5% today, national labor unions have been on the warpath to try and stop the bleeding. But then again, have U.S. workers really been hurt in the last few decades not having union representation? Is the U.S. labor market really in that bad of shape compared to the early 1980s? That is an open-ended question of course, and both sides with have their "facts" to support any answer.

Wal-Mart has the freedom here

Although Wal-Mart may be seen as walking a very fine legal line in bringing in managers and store supervisors from all over the country to "educate" them on what may happen with a Democrat in the White House this fall, it is free to do what it wants as long as their is no direct implication of "how to vote." So far, that doesn't look to be the case. The retailer is playing a preamble to some of its managers on the front lines of what their environment could look like if a Democratic president is indeed elected and unions have way more push into new areas unlike they have today.

If union representations use the "card check" method to get into stores and have at least 50% of its workers simply sign a card indicating a willingness to join a union, that would most likely be all that is needed to gain a foothold into that location. This is what Wal-Mart store managers fear most. No "secret ballot" needed -- the card check is much more stealth in its approach.

When a small group of meat cutters unionized in some Texas Wal-Mart locations back in 2000, the retailer responded by completely jettisoning butchers in all its stores in the U.S. and replacing them with pre-packaged meat product trucked in. That's quite a swift statement about unions, yes? It's quite apparent that Wal-Mart wants no part of any union in any of its stores. But, that doesn't mean that efforts to revitalize those efforts won't come back early next year if President Obama happens three months from now.

So, just like all of us this autumn, Wal-Mart will be watching the U.S. presidential elections with very interested eyes come November. After such an interesting run, this will truly be one of the most unique presidential showdowns in a generation, that much is for sure.

Join me right here next week for another edition of the Wal-Mart Weekly. Until then, have a great week!