Market Basket Employees Rally; Strife Could Affect Stores

July 18, 2014 -- TEWKSBURY -- Rally at the Demoulas Super Markets/Market Basket HQ in Tewksbury. Employees have demanded the reinstatement of Arthur T. Demoulas, who was ousted. Instead, n (globe staff photo :Joanne Rathe section: magazine reporter: erin ailworthtopic: 19demoulas)
Market Basket employees have demanded the reinstatement of Arthur T. Demoulas, who was ousted in June. They rallied on July 18 at corporate headquarters in Tewksbury.
Joanne Rathe/The Boston Globe

Market Basket employees made their strategy to re-install ousted CEO Arthur T. Demoulas clear at a rally Friday: They hope to force the board’s hand by stopping deliveries to stores.

“Where do we go from here?” district manager Tom Trainor said, in the last of more than a dozen speeches delivered to more than 2,500 employees, customers, vendors, and supporters of Demoulas. “We can shut this company down.”

Trainor said that leaving stores bereft of products would bring the company to a standstill, which might pressure management to give in to the demands of Demoulas supporters. Trainor called it the “only way” employees, emphatic that their former leader be re-instated, could win the standoff, saying emails and phone calls have not been effective.

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If deliveries were halted, existing stock likely would not last a week.

Halting deliveries would require the company’s warehouse workers and drivers to stay resolute with the employee movement’s stance. Market Basket’s employees have been left to decide for themselves whether to participate in the protest.

Steve Paulenka, who has also taken on a leadership role in the employee movement, said he assumed that corporate offices would attempt to find ways to make deliveries happen anyway. However, he said that on a normal day more than 160 employees work in the warehouse, many of whom have deep knowledge of its functions. He was skeptical that the warehouses could work at the same efficiency as they normally do.

Trucks for some outside carriers were seen on the property Friday. The Boston Herald spoke to one driver for an outside carrier, who said he was unable to make his delivery because of the lack of warehouse workers, and because Market Basket trucks blocked the truck bays.

Plans also call for employees to continue to gather at the company’s headquarters every day, starting Monday, until Demoulas is re-instated as CEO.

Employees had told the board of directors they required a response to their demand for Demoulas’s re-instatement by 4:30 p.m. Thursday. On Thursday afternoon, co-CEOs Felicia Thornton and James Gooch released a letter saying the board would meet by telephone on Monday to discuss the demand, and that at least two employees would be given the opportunity to speak with the board. (Trainor called that offer a “stall tactic” at the rally, in explaining why it was rejected.) The letter from the CEOs also said any employees who “abandon” their jobs would be fired.

Market Basket employees had hinted at the plan to halt deliveries previously, and other news outlets reported throughout the morning that few—if any—Market Basket trucks had left or entered the premises Friday. The company’s warehouse, trucking, and delivery system operates from the same property as the corporate offices.

In a letter published before the rally, titled “To Our Customers,” the employee group apologized in advance for any pain Friday’s action might cause consumers. “While we take action at headquarters, your store will inevitably feel the consequences of these as you shop,” the group said. “Please understand that this consequence weighs most heavily on us and we will make it up to you when we get back on track.”

Thousands showed up for the rally, including many from Market Basket’s stores across the region. Stores did not close. Employees who work at corporate headquarters had said Thursday they would not work, despite the warning from corporate. Paulenka, a facilities supervisor and long-time employee with the company, said a “sparse handful” of employees were working inside headquarters Friday. Paulenka said that between 125 and 150 employees work in headquarters.

Leaders of the employee movement were careful not to label the action as a strike or a lockout, and indications were that many of those who did not work had called in sick or used vacation time. It’s not clear how that strategy would affect Thornton and Gooch’s edict, though it would figure to give those employees some leverage. Several employees at the rally said they were willing to lose their jobs.

Market Basket employees are not unionized. Men in Teamster T-shirts were at the rally, and were said to be passing out information to employees. Teamsters also helped protesting employees coming from out of town find parking. However, Trainor denounced the possibility of unionizing in his address to employees. “We are stronger than a union,” he said. “We are a family.”

Trainor was one of more than a dozen employees and customers to take to the microphone at the rally. Others included George LeBlanc, a meat supervisor for the company, who channelled a Red Sox stars’ terminology following the 2013 Boston Marathon bombings. “In the words of David Ortiz,” he said, “this is our f-cking company.”

Other speakers pointed to headquarter’s refusal to allow portable toilets on the premises during the rally as a sign that management did not care about employees. The action to remove the toilets was caught on camera by the editor of the Tewksbury Town Crier, Jayne Miller.

Demoulas was fired last month, along with two executives, marking the start of the latest chapter in the wild story of the family-owned grocery chain. After Demoulas’s rival and cousin, not to mention namesake, Arthur S. Demoulas, gained control of the board last year, the board attempted to fire Arthur T. Arthur S. is not without reason for bitterness; the tension goes back decades and is described digestibly here. It includes courtroom fisticuffs.

An employee rally to fight the firing of Arthur T. last year resulted in the board delaying that action. That rally was held one year to the day prior to Friday’s.

Employees have repeatedly voiced their supposition that the board intends to sell Market Basket or its property, cut into employees’ lucrative profit-sharing and bonus benefits, and raise prices. Thornton and Gooch have said they would not raise prices or cut into benefits.

David McLean, an executive-level employee who resigned after Arthur T. was fired, issued a statement today.

“I am amazed but not surprised by this display of loyalty to Arthur T. Demoulas,” he wrote. “There is no better team than the Market Basket family of Associates. They are passionate, dedicated and loyal—to both Market Basket and Arthur T. Together we have built this company. We are very worried about these hard working people and their families. Family has always been our top priority. And that will never change.”

Market Basket operates more than 70 stores in Massachusetts, New Hampshire, and Maine, employing more than 25,000.

Thornton and Gooch have not responded to Friday’s rally yet. The switchboard at headquarters was off Friday afternoon, and the new CEOs did not respond to emails requesting comment before this article was published.

Update: The Boston Globe reports Thornton and Gooch have taken out an advertisement in the Saturday edition of the paper.

...in a letter to customers that appears as an advertisement in The Boston Globe on Saturday, new cochief executives Felicia Thornton and James F. Gooch apologized for the controversy. Some employees, the pair wrote, had "lost sight of the top priority--taking care of you--and instead engaged in actions that harm Market Basket's reputation and prevent us from meeting our obligations to you."

"We sincerely apologize if your Market Basket experience has been affected and is not in keeping with the standards you expect from everyone here," the executives added.