Teamsters and food workers target 99 Cents Only Stores.

After successfully organizing a handful of 99 Cents Only Stores truck drivers last year, the International Brotherhood of Teamsters has joined with the United Food and Commercial Workers to launch a campaign to organize the rest of the discount chain's 7,500 hourly employees.

Under a joint agreement between the two unions, the UFCW is trying to sign up 6,800 cashiers, shelf stockers and other retail employees in four states, while the Teamsters are targeting 700 warehouse and distribution workers.

With active organizing under way for several weeks, the UFCW has already filed a complaint with the National Labor Relations Board, alleging 99 Cents Only supervisors and outside consultants have coerced employees and intimidated those suspected of aiding in the union drive.

One Arizona-based employee was terminated for publicly supporting the organizing effort, the complaint claims. "I have only seen Wal-Mart as anti-union as this employer," said Xavier Sandoval, organizing director for L.A.-based Teamsters Local 630.

Art Lopez, manager of employee relations for 99 Cents Only Stores, acknowledged that outside consultants were hired to work with store managers and district supervisors to dissuade workers from joining the union. But they stressed that the campaign is designed to educate, not intimidate, and denied that any employees were terminated for talking union.

"There is no restriction against free speech," he said. "But when people are on duty, they are supposed to be working."

The discount retail chain, based in the City of Commerce, operates 223 stores in California, Arizona, Nevada and Texas, the bulk of them in Southern California.

Previous organizing

Last year, it offered less resistance when the Teamsters formed a collective bargaining unit containing 65 truck drivers working in Commerce. (The company also uses independent owner-operators to haul goods.)

Now the company is using the results of that campaign to dissuade other workers from joining up. As an example, company officials are telling retail and warehouse workers that the Teamsters promised drivers $10-per-hour raises over the life of a five-year contract that never materialized.

Instead, the contract the drivers ratified in December calls for annual raises for the drivers, who now make $12.50 an hour, of between 16 and 24 cents an hour through 2009.

"We believe if our employees know the facts about the drivers' contract with the Teamsters, they won't sign union cards," said Lopez. "We have always taken care of our employees. We believe that they are better off not having an intermediary or third party between us and them."

Sandoval admits that the truckers' contract is not a good one, but says that drivers ratified it against the advice of Teamster organizers.

"We were shocked when they approved it," said Sandoval, whose union bargained for nearly a year before the vote. "Just because of that single issue (of unloading trucks), I would never recommend the contract."

The contract hasn't received approval from the Teamsters International office.

One issue the unions are seizing on is their contention that 70 percent of 99 Cents Only Stores' hourly workers aren't eligible for health care coverage. The chain requires employees to work for at least one year and a certain number of hours each week to qualify.

"The most important thing for (workers) is health benefits," said Rick Eiden, executive vice president of UFCW's Buena Park-based Local 324. "They have to make a choice whether to put food on the table or pay for benefits."

Retail and warehouse employees start out at $6.80 to $7 per hour and can make more than $10 per hour as a senior-level hourly employee, Lopez said. He also points out that 95 percent of store managers and district supervisors are promoted from within.

Furthermore, the publicly traded company grants hourly employees options to acquire as many as 300 shares each year at market prices. The company loans the employees money to exercise the options using no-interest loans.

Employees can sell the stock at any time within a 10-year period, and pay back the loan. If the share price has risen, the employee keeps the profits. If the stock goes down before the employee sells, the loan is forgiven.

Since the company went public in 1996, employees have collected more than $90 million from stock options, said Lopez.

However, over the past five years, the program has been less effective. On March 30, 99 Cents Only Stores' shares were trading at $13.18 each, down from $24.48 one year earlier and $18.81 five years earlier.

Even if the stock were on the rise, union organizers said many employees only get 20 to 50 shares per year, which doesn't make up for the low wages.

To date, there has been no talk of a strike or even picket lines by off-duty workers. The unions' priority is to get enough workers to sign union cards to mandate a vote to decide whether to form a collective bargaining unit.

"Generally retail is a high turnover industry, with the exception of where they are unionized and getting fairly good pay and benefits," said Daniel Mitchell, a UCLA professor of management and public policy.