For over a century, union bosses have famously used a wide range of strong-arm tactics to pressure workers into joining unions whether they want to or not.
But with the unionization rate in freefall for decades because workers aren’t buying what union bosses are selling, Big Labor is taking the fight to a new frontier: the boardroom. This new tactic shows how unions are taking advantage of President Joe Biden’s Big Labor bias.
The Wall Street Journal recently reported that the Strategic Organizing Center, a coalition of three prominent labor unions, filed a proxy contest seeking to install three handpicked candidates on Starbucks’s board of directors. The SOC, which owns a small stake in Starbucks, will nominate Maria Echaveste, Wilma Liebman, and Josh Gotbaum to mount a challenge against three existing directors.
All three candidates would be SOC sock puppets if elected to the Starbucks board. Echaveste served as the deputy chief of staff for President Bill Clinton and is now a senior fellow at the Center for American Progress. Liebman served as the chairwoman of the National Labor Relations Board under President Barack Obama. Gotbaum is a former longtime government bureaucrat.
The SOC is taking advantage of a new Securities and Exchange Commission rule to hijack the Starbucks board. The universal proxy rule requires companies to include management and dissident shareholder nominees on a single proxy card in contested elections, creating confusion for shareholders who may not be fully aware of the challenging candidates’ qualifications or motivations.
Crucially, the new SEC rule allows the SOC to push for huge changes to the Starbucks board with comparatively little skin in the game. Starbucks has a market capitalization of $105 billion. The SOC owns 161 shares of Starbucks, a stake worth approximately $16,000. Thanks to the universal proxy rule, the SOC can use Starbucks’s own proxy materials to promote its hostile takeover attempt without bearing the costs of its own solicitation.
The Starbucks proxy fight is one part of SOC’s broader scheme to impose Big Labor’s agenda on every publicly traded American company. The SOC’s coalition includes some of the most militant and disruptive unions in the country: the Service Employees International Union, Communications Workers of America, and the United Farmworkers of America. These unions regularly engage in strikes, protests, boycotts, litigation, and other tactics to bend workers and employers alike to their will.
The Biden administration aids and abets Big Labor’s hostage-taking negotiation tactics. Biden campaigned on being “the most pro-union president you’ve ever seen,” raking in billions of dollars of Big Labor money for Democrats in the 2020 election cycle.
Since he first stepped foot in the Oval Office, Biden has used the full force of the federal government to make it easier for union bosses to organize workplaces. The Biden NLRB has repeatedly considered the most noxious workplace speech as protected union activity so long as it stops short of directly threatening violence. Liebman, the aforementioned SOC nominee, condoned an employee’s sexist and vulgar comments to his female colleague as “mostly rhetoric.”
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The Biden administration’s ultimate goal is to unionize workplaces without holding elections at all. This is not a hypothetical scenario — the NLRB’s recent decision in Cemex Construction Materials Pacific, LLC mandates that employers have to recognize and bargain with unions without holding an election if the NLRB determines that the employer has committed an unfair labor practice.
The SOC’s hostile takeover attempt of the Starbucks board is just the latest example of how Big Labor is taking advantage of the Biden administration’s regulatory changes to force more workers into unions.
Tom Hebert is the director of competition and regulatory policy at Americans for Tax Reform and the executive director of the Open Competition Center.
