Jason Chappell
May 30, 1997
Dear Borders Booksellers, Musicsellers, and Cafe Staff:
For the past 15 months, the issue of unionization has been raised in various ways among us. Essentially, our Company has been targeted for organization by the United Food and Commercial Workers Union. Indeed, one of our former employees from Lincoln Park and one from Philadelphia have been hired by the union to further its efforts. In light of these developments, which are likely to persist, I wanted to address this very important subject with all of you in a very frank and open manner.
I do not believe the interjection of a union at Borders is in any of our interests. Why? Because the union does not add value to our operations. Let me explain how I have come to that conclusion.
Historically, unions in the United States fulfilled and, in some instances, continue to fulfill a necessary role in an organization. In the 1930's, for example, workers were not protected by the wide variety of employment laws which exist today. Companies did not provide benefits in many instances for their people. Work places were not even safe in many industries. Employees, for protection, turned to unions.
Times change; business philosophies mature. At Borders, we have always attempted to create a unique employee relations environment. We sought out and cherished diversity among people before corporate America even knew what the word "diversity" meant.
We recruited full-time people and paid them at industry leading rates while competitors used part-timers to avoid high labor costs. We accepted our responsibility to our people by providing excellent benefits, including domestic partner coverage, as a logical extension of our commitment to diversity. We are concerned about your long-term well-being, which is why we have our 401(K) plan with immediate vesting.
We have promoted heavily from within, creating thousands of opportunities for people while, at the same time, respecting the wishes of those who have a passion for selling and do not wish to advance. But for all, we maintain maximum flexibility in scheduling and transfers from place to place because we do care about people.
And we have done more. We have provided stock option and stock purchase programs because we do no want to hire employees--we want co-owners. Frankly, our employee relations record is not only excellent, it is trend setting.
Perhaps you have heard that phrase "no good deed ever goes unpunished." I have been asking myself why some of our people are attracted to the notion of a union. I have studied the arguments and find them unpersuasive.
For example, some say a union would help provide a "living wage." While the concept is romantically appealling, it ignores the practicalities and realities of our business environment. We already spend 13 cents of every dollar on our employees, almost double industry standards. Our ratio of entry level to executive pay is among the lowest in the U.S. We constantly conduct wage and benefit surveys to ensure our cutting edge position. How could a union provide for more?
Some say Borders is different--and we are. However, we must live with the same economic rules and constraints as everyone else. We cannot change the cover price of a book simply because we are Borders.
Others claim we should open fewer stores to provide for more pay increases. Nonsense. The growth of our business in our ticket to continued success. The more we expand, the more possibilities exist for increasing market share, creating more favorable business terms with our suppliers and realizing productivity improvements through enhanced economies of scale. This, ultimately, may yield more profits to share with our employee owners. And, in any event, the opening of our stores is a management right, which unions would not influence.
So, I say again, how would a union provide increased value to us? Against our enviable record, against our passion for our employees, they have nothing to offer as far as I am concerned.
To the contrary, unions possess the real potential of creating divisions between us. Now, everyone feels free to chip in and do whatever is necessary to make the store succeed. But in Chicago, we are still haggling over whether assistant managers may perform bargaining unit work like shelving books, keepering music, or making a latte. In Lincoln Park, The UFCW proposed their health plan with inferior benefits to our own, and more expensive. We rejected the concept.
We suddenly find ourselves spending literally hundreds of hours dealing with issues like union security clauses, dues check-off provisions, grievance and arbitration matters, seniority, time off for union business, no-strike clauses--the list goes on and on, instead of spending that time on how to improve the business. Is this value--especially since approximately 26 of the employees now working in Lincoln Park were not even hired when the election took place? It is not the way Webster would define the word.
Therefore, let there be no misunderstanding. Borders is opposed to the unionization of our stores. And I think you, as owners, should be too, especially after you fully appreciate how a union would impact you--as an individual, with its myriad and byzantine rules and regulations set forth in its constitution and local union by-laws. Therefore, we will do whatever is necessary to explain our position to everyone and anyone because we want to remain a collective ensemble--not "us" and "them".
Thank you for taking the time to read this extended letter. I assure you my passion on a subject has never been more profoundly felt.
Most Sincerely,
Richard Flanagan President Borders Stores