I am wicked proud right now. If you aren’t from New England, you just snickered. If you are, you just kept reading like nothing happened.
But know that something is happening. The employees, or associates, of my hometown grocery store Market Basket are rallying on behalf of their beloved CEO Arthur T. Demoulas, who was fired in late June. His dismissal catalyzed hundreds of workers across the supermarket chain’s 71 stores to walk out on the job two weeks ago. They’ve put their positions on the line for a man many consider family – even if he remains at war with his own.
The saga of the Demoulas family goes back decades. It’s a caustic feud fueled by greed, deceit, litigation, and good-old fashioned spite. No one’s hands are clean. There is, however, a CEO nonpareil whose fight to regain control of Market Basket has sparked something of a revolution in the Bay State – a modern day Boston Tea Party if you will.
Early on, some pundits suggested the strikes could backfire on the Market Basket employees who vowed not to return to work until Arthur T is returned to the helm. They argued a prolonged strike could strengthen competitors in the region and eventually invite the ire of the Market Basket customer base. I suggest next time they incorporate a little history and cultural analysis into their reading of the corporate tea leaves. Because this is a region that relishes supporting the underdog and is okay being shut down for a good cause.
Remember when about a million people sheltered in place while federal agents combed the streets of Boston searching for the suspected marathon bombers? Don’t let the recent spate of championship trophies fool you. This was a region of losers a lot longer than winners, and deep down, it’s still looking for a fight. Particularly against a couple rich guys putting the squeeze on everyday people trying to eke a living.
The Demoulas empire began in Lowell in 1916 as a mom-and-pop grocery store owned by two Greek immigrants and specializing in cuts of lamb. They sold the business to two of their sons Mike and George who expanded the store to the Market Basket chain it is known as today. This is where things start to get messy. In summary, one side of the Demoulas family (George’s) accused the other (Mike’s) of defrauding them out of company shares worth about $500 million dollars.
The courts agreed and gave slight majority ownership (50.5 percent) to the family of George Demoulas. Despite the bad blood, the family has remained in business together with Mike’s son serving as the company’s CEO since 2008 and George’s son in control of the board of directors. Both cousins are named Arthur simply to make this even more confusing.
I never knew any of this as a kid when shopping at the flagship store with my mom. I just knew that we always seemed to grab the one cart with a rogue front wheel that refused to spin down the maroon and white tiled floors. And we never left the store without bumping into some neighbor or friend perusing the aisles or working behind the counters. Whole Foods didn’t arrive in my hometown until I was in high school and my parents never shopped there even after it did. I’d like to say it was because they knew Market Basket employees were paid a fair wage, promoted from within, and received perks like profit sharing from the company. But I don’t know that. I do know that Demoulas Market Basket had an unusual name, good produce, quality meat, and low prices.
Last July, new signs of trouble emerged when the Market Basket board of directors contemplated removing Arthur T., known henceforth as Artie T since that’s what Market Basket employees call him, citing mismanagement of funds. The accusation came despite the company growing sales by 52 percent under his leadership. The board also voted to redistribute $300 million to family shareholders, a move that Artie T opposed and filed a lawsuit against, arguing through a spokesperson that “taking out 60 percent of the cash on hand from the company [would] break Market Basket’s proven business model, and forever change how the country operates and grows.”
Employees saw the board’s actions as a signal the company was careening down the wrong path and the response of their fearless leader as a call to action. Their weapon of choice has primarily been a Save Market Basket Facebook page, which has served as their mouthpiece to the masses and explainer on their reasons for leaving store shelves empty. When most people hear of workers striking they conjure images of union reps with bullhorns calling for higher wages. However, this recent imbroglio veers from the traditional playbook. In part, because Market Basket associates don’t have a union. And they’re already well compensated. Part-time hourly employees already make $4 more than the state’s minimum wage.
The associates have taken up the mantle of their CEO, a move considered unprecedented today, because they believe he values people over profit. Artie T’s generosity has been likened to George Bailey the winsome protagonist of It’s a Wonderful Life. After the financial downturn of 2008, Artie T. replenished the employees’ profit-sharing plan with about $50 million so that they would still receive bonuses. In a story in the Lowell Sun today Artie T is quoted as refusing to install self-checkout lines because he wanted “a human being waiting on a human being.”
I get that.
Under Artie T, the company has expanded its presence across New England while managing to pay employees a livable wage and keeping prices lower than WalMart. Customers get that too. Since associates began their strike, loyal Market Basket customers, including my family members, have boycotted shopping there as a show of support to its workers and former CEO. My sister told me people have taken to taping their receipts from competing grocers to Market Basket storefronts. Public support surged after eight Demoulas managers with a combined 280 years experience were fired July 20.
Regional manager Tom Trainor described how he was let go on the Facebook page saying, “I was fired today after 41 loyal and great years … by courier at my home with my wife and youngest daughter watching … It was expected, when I started this fight over a year ago I knew the risk but I also knew that I was fighting for something much bigger than myself.”
Trainor called the board’s ousting of Artie T an attempt to cut the head off the snake, and the firings as its latest attempt to cut down Market Basket leaders opposing changes to the company. He encouraged associates to continue the fight warning that “the time is now or never … it won’t be long before you are replaced by someone who will do your job for less money. This is your last chance to take your company back.”
I think that fear of being replaced is universal and what has moved so many Market Basket customers to rally behind this supermarket chain that, in many ways, is only remarkable in its treatment of its employees. It’s a symbolic shot across the bow to the rest of corporate America. And it feels like some important people at the top are finally paying attention.
In the days after the firings, Artie T indicated his side of the family has offered to buyout the other side for ownership of Market Basket, a proposal, the board says it is considering, along with a number of other suitors. But as statements from campaigning politicians declaring their support of Market Basket associates pile up and coverage of the fiasco extends overseas, neither side appears willing to back down or buckle.
Just yesterday the company’s co-CEOs Felicia Thornton and James Gooch issued a final warning to protesting employees, urging them to return to work by August 4, or face permanent replacement. This seemed to only provoke employees who once again took to Facebook to respond:
“This latest statement shows the disconnect with F& G, they are under the impression that if they get the stores full of product the customers will come back in droves. They either haven’t been listening to you, our beloved customers or they don’t care. They have underestimated us at every turn and now they are underestimating the strength of your boycott. To us, that is insulting.”
So we remain in a stalemate in a food fight for the ages that appears can only end with one side wearing egg all over their faces.