Wal-Mart's next battle: in the Big Apple

[UPDATE: Since this story was written, developers have dropped plans to build a Wal-Mart at the proposed Queens site. But Wal-Mart says it still would like to open a store in New York City and will continue looking for a new site.]

Wal-Mart, once no more than a rural dime store, is now hoping to cap its global retail empire by taking on the nation's largest untapped metropolis: New York City.

While no formal agreements yet exist, word that the controversial low-cost retailer is eyeing a site in Queens has already generated such a backlash that some analysts say the fight for approval in Rego Park will be the largest and most symbolic showdown yet between the megastore and its union opponents.

"If there ever was a part of the country where people wouldn't tolerate [Wal-Mart,] it would be a city like New York where there's a strong labor movement," says Kate Bronfenbrenner, a labor economist at Cornell University in Ithaca, N.Y. "People there fight back when they smell a labor rat."

The battle for the Big Apple will also prove to be a test case for one of several new tactics that opponents are employing from here to Montana to hold big-box employers like Wal-Mart accountable to the community. They include requiring companies to provide health insurance, as in a proposal in New York; establishing so-called living wage laws, which is under consideration in Chicago; and limiting the size of such stores, which some communities are attempting to do in Vermont.

"A second-generation response to the big-box sector has emerged over the last year or so," says Paul Sonn, associate counsel at the Brennan Center for Justice at the New York University School of Law. "The aim is to level the playing field so that if Wal-Mart does come to New York, it will provide the same benefits that other responsible retail employers like the supermarkets are paying."

Wal-Mart and its supporters say the retailer already offers good benefits, paying almost double the minimum wage and providing some health and dental insurance, as well as a 401(k) retirement plan to eligible employees.

They believe the unions have targeted the company because it is now the country's largest employer with 1.2 million workers. And it's proudly nonunion, which they say allows it to offer bargains, helping families and communities by saving them money - at the same time that the stores increase the tax base.

"What's at issue here is not whether a particular union has been able to organize or collect dues from our workforce," says Daphne Moore, director of community affairs for Wal-Mart in Bentonville, Ark. "It's whether consumers have a choice of where they shop."

But opponents argue that Wal-Mart's wages are lower than those of other retailers such as department stores and supermarkets. And they contend that its controversial labor practices, from alleged violations of child-labor laws to lower wages to minimal health insurance, actually cost communities money.

Page: 1 | 2