Target headquarters in downtown Minneapolis.
Organized labor’s first victory at Target Corp. — a pro-union vote by pharmacy workers in New York — will stand as federal regulators this week rejected the company’s petition to nullify the election.
In September, pharmacy workers at a Target in Brooklyn voted 7-2 to join the United Food and Commercial Workers Union. Minneapolis-based Target petitioned labor regulators to invalidate the election, saying it should never have occurred because the company is selling its entire pharmacy operation to drugstore giant CVS.
The $1.9 billion CVS deal announced in June affects all 1,660 Target pharmacies, which employ about 14,000 people.
On Tuesday, the full board of the National Labor Relations Board [NLRB] denied Target’s petition, saying it “raises no substantial issues warranting review.”
Target could ask a federal appeals court to reverse the NLRB’s decision.
“We continue to evaluate our next steps,” Target spokeswoman Molly Snyder said in an e-mail. The company maintains its position that the NLRB should never have allowed the union vote in the first place.
Outside of supermarkets, the retail industry is essentially devoid of organized labor, and Target and other big retailers like Wal-Mart have long fought attempts to unionize their stores. There have been union elections at two Target stores: one in Valley Stream, N.Y., in 2011, the other in Detroit in 1990. Unions lost both.
In the Brooklyn case, Target argued that, historically, the NLRB has dismissed union election petitions in the face of “imminent and certain change” at an employer — change that would lead to employee termination.
Target said the CVS deal should close between Dec. 31, 2015, and Jan. 16, 2016, and that Target pharmacy workers would then be terminated. “No purpose would be served in holding the election,” Target’s petition said.
Target petitioned the NLRB’s full board in Washington, D.C., after an earlier decision by James Paulsen, director of the NLRB’s Brooklyn regional office. Paulsen ruled that the CVS deal was subject to regulatory approval — which is not guaranteed — and if problems arose, the deal’s closing date could be postponed. Target said it doesn’t expect problems getting regulators’ blessing.
Paulsen also ruled that the Target situation is “clearly distinguishable” from past board cases in which an employer shuts down and permanently lays off employees.
With CVS basically taking over Target’s pharmacies, the deal does not involve an operational shutdown. “All of the employer’s employees are to be offered employment with CVS at substantially the same terms and conditions of employment,” Paulsen wrote.
In its petition to the NLRB, Target noted that CVS has committed to continue offering — for at least a year — wages and benefits that are no less favorable than what Target pharmacy workers get now.
However, it’s not clear whether CVS would have to recognize the union in Brooklyn. CVS couldn’t be reached for comment Thursday.