Tesco, Briefing, January 2006

Tesco – a briefing for activists

'Treat people how we like to be treated' – one of CEO Terry Leahy’s “Tesco values”

Tesco’s success
 Tesco PLC is the largest British retailer, both by global sales and by domestic market share – the fourth largest in the world. According to TNS Superpanel, Tesco's share of the UK grocery market in the 12 weeks to 4 December 2005 was 30.6%. Across all categories, over £1 in every £8 of UK retail sales is spent at Tesco.
 In the year ending 26 February 2005, Tesco made a pre-tax profit of £1.962 billion on turnover of £33.974 billion. In the last 5 years its turnover has risen by 80.75%, while its pre-tax profits have gone up by over 110%.
 As of early 2005 Tesco operated 1,780 stores in the UK and 585 in 12 other countries. It also delivers to over 1 million households through its Internet operation.
 Tesco's market capitalisation (31 August 2005) is £25.3 billion, the largest of any retailer based outside the United States. For the 24 weeks to 13 August 2005 revenue grew by 13.8% and profits increased by 18.7% before tax (18% after tax)

The levers of power
Tesco gives away some of this money to ‘social causes’ – Corporate Watch states that the company gave £12 million for the Millennium Dome and several thousand pounds a year to the Labour Party. They even give £16,000 a year (2003 figure) to Usdaw, the trade union that organises workers at Tesco!
Corporate Watch says that donations to New Labour have raised a few eyebrows. “It was reported in The Observer at the time that lobbying firm, LLM - involved in a campaign on behalf of Tesco to block plans for a tax on shopping centre car parks - had 'suggested that a £12 million Tesco donation to the Millennium Dome was part of a 'quid pro quo deal'—giving its support to a government project in order to endear itself to New Labour. The paper went on to say that there is no suggestion that Tesco made the Dome donation to help it get its way over the car park tax issue. But the plan to impose the tax was dropped from the White Paper on transport—and the terms of the exemption were exactly as LLM's Ben Lucas had suggested. The Sunday Times said that the estimated cost to Tesco of the car park tax would have been £40 million.”
Similarly, “It is quite clear that Tony Blair has a fascination for successful corporate bosses, including Terry Leahy who was knighted in 2002.” There certainly has been a consistent record of Tesco employing former government advisors and officials, staying close to the circles of political power. Tesco's Company Secretary and Director of Group Corporate Affairs, Lucy Neville-Rolfe, is an example of links between industry and state and government. At Tesco, her responsibilities include government, EU and competition issues, investor relations, communications, community affairs and corporate affairs policy for the international business in 10 countries. She reports directly to Terry Leahy.
Neville-Rolfe’s external appointments include business lobby groups, NGOs and government committees such as the CBI Europe Committee, UNICE Task Force on Enlargement and the boards of EuroCommerce and the British Retail Consortium. She also sits on a 'work and enterprise' panel for The Work Foundation and is on the advisory committee for the Economic and Social Research Council 'Cultures of Consumption' project. Another advisory role is sitting on the President's committee of London First, which Tesco also sponsors. She has been appointed to the Foreign and Commonwealth Office Management Board, as well as to the Deputy Prime Ministers' Local Government funding committee, which is looking into better ways of funding council services.
Source: Corporate Watch

Tesco exploits workers
Sadly, the picture’s not so bright for either its 360,000 retail workers worldwide or the people who work on the farms where some Tesco produce is grown.

Case study one – casualised labour - farm workers in South Africa
Over 104,000 workers are employed permanently on around 3,000 fruit farms in South Africa. Tens of thousands of women are now increasingly employed as a ‘reserve army’ of part-time labourers to do contract and informal work to pick and pack the fruit for export. Most of the deciduous fruit (apples, pears, plums and peaches) goes to Europe – and Tesco is the UK’s biggest buyer of this produce. Despite promises of social responsibility on its corporate website, the company does nothing to alleviate the misery of the people who pick fruit for it - their aim is simply to keep their supplies cheap, not to make sure the workers who pick fruit for their shelves get a fair deal.

Workers:
 Receive poverty wages: "I get 378 Rand [£32.50] pay every two weeks. I can’t afford school fees for my daughter or go to school functions or buy school uniforms," says Tawana Fraser, who works as a ‘permanent casual’ labourer on a pear farm that supplies Tesco. The minimum wage in South Africa for two weeks work should be 419 Rand [£36}, but illegal poverty wages are widespread.
 Are exposed to pesticides: "They spray pesticides while the women are working in the orchards. We have no gloves or protective clothing and we have to climb wet ladders and pick pears from the trees while they’re still wet from pesticides," says Tawana Fraser. She says that spraying normally happens twice a week and that nobody on the farm wears protective clothing.
 Live in dismal housing: "I sleep on the floor on a plastic sheet…there’s no water or electricity and the walls of my shack are made of cardboard," says Gloria Nzama, who finds work intermittently on Tesco-accredited farms. The global trend towards casualization of labour means thousands of South African workers living in dismal housing conditions in compounds, shanty towns and informal settlements.
 Lose out on benefits: "The men get everything – boots, uniforms – all free. Seasonal women workers get nothing. Why must we pay, and the men not?" says Gertruida Boysah, who works all year on a pear farm supplying Tesco. Casual women labourers are often cut out of a range of work benefits. Workers complain that they have no access to benefits provided by labour legislation.

Tesco, refusing to deal with specific complaints, replies that they have “brought enormous social and economic benefits to thousands of workers…we work hard to ensure that every worker producing for Tesco is paid fairly and treated decently and we audit suppliers regularly to ensure that this happens.”
Source: ActionAid

Case study two – sweatshop conditions - homeworkers in the UK
Homeworkers are one of the most vulnerable and low paid groups of workers in the UK (the majority are women), who pack, label and assemble a range of products which are then sold within major high street stores. The National Group on Homeworking has named Tesco as an exploiter of homeworkers, along with competitors such as Asda, Sainsbury’s and Morrison’s.
Government statistics show that at east 1.2 million people undertake this form of work in the UK. While they are entitled to be paid the minimum wage, this is often not given, whilst they also denied sick pay, redundancy pay and basic health and safety standards.
For example, in the run up to Christmas homeworkers were heavily involved in the packing of greeting cards, gift-wrap and tags, along with the assembly of novelty Christmas goods. Up until recently homeworkers packed almost all the Christmas crackers we buy from major UK retailers - when homeworkers complained about being paid wages as low as £1.40 per hour companies moved a great deal of cracker production overseas to China in search of ever-lower prices. This level of double exploitation is unacceptable.
 Many homeworkers are not paid the National Minimum Wage; others are denied basic Health and Safety protection and employment rights, and some work late into the night or go for weeks with no income at all.
 Because these workers are so hidden they have little opportunity to organise and often find that when they complain about poor conditions the work simply disappears, as one homeworker stated: “They can do what they want, you have no employment rights. The company have you on a string, at their convenience and this should not be allowed.”
The National Group on Homeworking has demanded that Tesco, along with its competitors, stick to the provisions of the Ethical Trading Initiative which it has signed up to.
The International Labour Organisation has called for homeworkers to be entitled to the same rights as other workers, and also for these rights to be properly enforced. This includes the right to take part in labour organisations of their choosing.
Source: National Group on Homeworking
To read the convention on homeworkers: ILO Convention

Case study three – maltreatment of agency workers - Polish distribution workers in Ireland
Soon after the entry of Poland into the EU, Tesco began to employ more and more Polish workers through temping agencies. Tesco is taking advantage of workers coming from Poland who are unaware of their rights as employees and who are at first grateful to get a job which pays more than they would get at home.
As the workers are temporary, they can be just “let go” if they fail to meet ever-increasing targets. Due to the new targets being unsustainable, there has been much dissatisfaction among the workforce. In July 2005, two Polish workers who were vocally expressing this dissent found themselves fired. Firstly, the workers made the demand that productivity targets be reduced to a manageable level. They also demanded that the two employees who were laid off have their jobs reinstated and that agency temps who work for longer than 3 months should get a permanent contract from Tesco with all the associated benefits.

Problems faced by the workers:
 An ever-increasing workload: “Usually we pick 750 (boxes), but after three months of the normal rate our manager wants more, more, more . . . it's not possible picking 900. You must look after your back, and health and safety processes. If you pick 1,000 you'll break your back, you can not work like that”. Another worker said, “We have the interview every month and they say to us to pick up to 900 and a 1000. My manager told me I must pick up 130 cases an hour. It's ridiculous. The norm is 100. Anyway, there is no pick rate (anywhere else) in the whole country. After that he took in another guy and told him you must pick 140. Then another guy and he said to him 1100 a day. They say more, more more . . . you can not do that!"
 A union which doesn’t stand up to the bosses: when SIPTU organised a meeting on the shop floor, a phone call from the union rep. told them that their protest was illegal. Then a union official approached, apparently unsympathetic, saying, “This is an illegal protest lads, you have to follow the proper channels, there was work there for you but you didn't want it, you'll have your day in the labour court.”

But the Polish workers organised a Tesco Agency Staff Protection Committee, demanding the reinstatement of sacked workers, better contracts for agency workers and lower work-rates. Their protests outside their workplaces were backed by international pickets of Tesco stores, including solidarity action in Poland and protests by Polish TGWU members and others in the UK.

Text of leaflet distributed by sacked workers:
It’s Time To Take Strike Action.
We found our work in Tesco Distribution through a temp agency. Then we were happy to finally have work at Euro 9.52. But now after a few months observing conditions in Tesco it's time for deep critical reflection.

Conclusion One: We Are Needed.
The fact that we work for Tesco every day, some of us for over a year, and others just for a few weeks means we are needed in Tesco. Just like forklift drivers and managers we are part of Tesco, pickers are needed and nothing will change that.

Conclusion 2: We Are Used.
It is very convenient for Tesco to use agency staff instead of giving us a contract. We are like a service that is bought for a few hours, like a product with the immediate possibility of being dumped all the time (e.g. sacking Zbyszek Bukala and Radek Sawicki). We are cheap, and Tesco takes no responsibility for our exploitation. The agencies also profit when they hire us; they earn a lot of money from our work. But what about us? Usually we are foreigners, unaware of our rights, and often without language skills. Starved of work we take whatever they give us. We do the same work as contracted workers, but we get lower salaries and none of the benefits from a contract. They do not even give us a glimmer of hope that this situation can be improved. At last we have to say loud and clear – we are used!

Conclusion 3: We Can Change It.
There are a lot of us on each shift. When we are united we have a real power. If we speak with a common voice we can change this situation for the common good. Let's do it! Instead of being a cog in the Tesco machine we can become partners.

To Sum Up - Fight For Improvement Now.
Conclusion 1 – Without us Tesco Distribution would cease to function.
Conclusion 2 – There are a lot of us, united we can change our own conditions.
Conclusion 3 – If we are angry we should act, we should demand that the agencies and Tesco accept our demands. We should seek support from workers on contracts.

TESCO AGENCY STAFF PROTECTION COMMITTEE DEMANDS:
1. Zbysek Bukala and Radek Sawicki Must Be Reinstated To Tesco Distribution.
The agencies attempt to transfer them to work in another company is nothing more than silencing the voices of workers. There was not even an attempt to find a solution through dialogue.

2. Contracts for agency staff after three months on the job.
This situation is unjust. While contracted workers get over Euro 500 a week on a day shift, agency staff get just Euro 320. Frustration and resistance is guaranteed to grow the longer you are in these conditions. There is no justification for such a policy. Whatever there arguments, they are nothing compared to our moral right to a contract. Three months on the agency's leash is enough. If Tesco need is they should treat us as normal workers.

3. The rate of 1000 cases a day must be cancelled.
The continuous raising of the daily norm (from 750, to 800, to 900 and then 1000) must be stopped. The intimidation and dismissal of workers who fall short of it can not be accepted. Everyone works in line wit their physical abilities and the health and safety regulations we were taught in training. Lifting 1000 boxes a day is a sign of a workers good will, it should not be the cause of favouritism over some one else who can not work at the same rate.
Radoslaw Sawicki, TESCO AGENCY STAFF PROTECTION COMMITTEE.
Source: Indymedia

Case study four - withdrawal of sick pay rights – UK retail staff
In summer 2004 the Confederation of British Industry, a bosses’ organisation, published a report claiming that 15% of all days taken off by workers were not authentic. Even though in the previous five years time lost to sick leave had actually been falling continually, Tesco took the opportunity to attack their workers’ right to sick pay.
They introduced an “experiment” whereby workers in 10 ‘trial’ stores would not be paid for the first three days they were off work. The idea was to force workers into coming into work, even if they were ill, since they’d be too afraid to lose their income.
Forcing their staff to work even if this posed a risk to their and other workers’ health is of course appalling – but this is particularly the case given that workers in the UK work longer than any other country in Europe. This heavy workload is bound to lead to fatigue and illness. Yet for Tesco, the only aim is to increase their profits – and even though their profits are growing quickly, the CBI report still offered a welcome opportunity for them to squeeze their workforce even harder.
In the face of such naked exploitation by Tesco the shop workers’ union, Usdaw, supported the cuts in sick pay.
Pauline Foulkes, Usdaw National Officer wrote to union reps that, “Usdaw are supporting this trial because we want to have an input and share the learnings and have a say in shaping and influencing the outcomes. Staff in the 10 existing stores chosen for the trial are being asked to co-operate and support the trials by volunteering temporary change of contracts for a 12-month period.” In other parts of the letter, Foulkes hints that all new starters at Tesco will not get sick pay for the first three days they are ill.
Even though Usdaw knew that the ‘trial’ may lead to the extension of attacks on sick pay to all Tesco stores, it failed to oppose the company. The union has a ‘partnership deal’ with Tesco. Tesco help Usdaw (for example, job application forms include a tear off union membership slip, and a recommendation that applicants join Usdaw) and in return expect Usdaw to help Tesco.
Equally, recognising the union implies that Tesco care about their workers and are happy to let them organise freely, which gives a veneer of respectability to what are in fact very hostile moves against their staff.
Source: Mark Sandell, Workers’ Liberty

Tesco policy destroys our environment
 Tesco boasts about its progress on reducing waste and how it is following a market trend to introduce degradable plastic bags. But grocery packaging still makes up roughly a quarter of household waste, and the UK's biggest supermarkets distribute some 15 billion plastic bags, which end up in landfill. According to Friends of the Earth, supermarket chains have shown little interest in reducing the amount of packaging they churn out.
 The supermarkets' hunt for cheap food has encouraged intensive agriculture, at the expense of more sustainable methods, with devastating effects on the global environment.
 Tesco says it works with suppliers to keep pesticide residues in fruit and vegetables to a minimum. Yet Government data shows that the company made no overall reduction in the level of pesticide residues in its food between 1998 and 2002. As well as posing a threat to human health (particularly that of workers on farms), pesticide use results in pollution of farmland and water supplies.
 Tesco is also contributing to deforestation through its reliance on palm oil, a cheap vegetable oil found in more than 1,000 products that the store sells. Palm oil plantations are now the major cause of rainforest clearance in Indonesia and Malaysia, threatening some of the world's richest wildlife forests and endangering native species including the orang-utan and the Sumatran tiger.
 Supermarket fruit and vegetables must meet very high appearance standards - fruit is rejected because it had too much colour, too little colour, was the wrong size, wrong shape, or because of blemishes that did not affect eating quality. Worryingly, more than half of the growers interviewed for a Friends of the Earth survey, said that they had to use additional pesticides just to meet the appearance specifications of the supermarkets. At the same time, these specifications cause a great deal of waste in the food chain. Some growers in the survey stated that they couldn’t even harvest their fruit, or that they simply had to dump fruit that was fit to eat. Similar results are found for other fresh produce. It is estimated that between 40 and 50 per cent of raw vegetables and salad (by weight) are rejected at some stage of the production line before reaching the shopper. Tesco are clearly more concerned about making shiny goods to sell easily than the environment.

Ironically, Tesco advert front-woman Prunella Scales is head of the Woodland Trust, and former president of the Campaign for the Protection of Rural England.
Source: Tescopoly/Friends of the Earth

David Broder, January 2006