FILE PHOTO: The logo of the International Brotherhood of Teamsters labor union is seen on the outside of their headquarters in Washington, D.C., U.S., August 30, 2020. REUTERS/Andrew Kelly
February 2, 2022
By Ross Kerber
(Reuters) – The Teamsters union wants four large U.S. retailers to investigate if companies in their supply chains are underpaying workers, hoping the retailers will use their leverage with vendors to achieve greater protection for those individuals.
The union has filed resolutions for shareholder meetings this spring at Lowe’s Companies, Best Buy Co, TJX Companies and Urban Outfitters Inc, according to union officials and documents seen by Reuters. Only one, at Lowe’s, so far has been disclosed in public filings.
They are among a wave of resolutions set to make “human capital management,” or HCM, a chief topic of the upcoming shareholder meeting season this spring. The term has come to cover both traditional personnel issues like recruiting and skills development, and broader subjects like workforce diversity and pay that are part of an increased global focus on inequality fueled by the COVID pandemic.
The resolutions also come as companies grapple with worker shortages that have contributed to rising prices and bare shelves.
The union does not represent workers at the retailers. But it does represent workers at some logistics companies and hopes to represent more of them.
The Teamsters said the retailers have likely used logistics companies that have faced legal challenges from drivers over their labor practices at Southern California ports.
In October, one logistics firm agreed to pay $30 million to resolve allegations including that drivers were paid less than minimum wages, according to legal filings.
Relying on partners with records of poor working conditions could expose the retailers to bad publicity, and to legal liability in California, according to the Teamsters.
The potential use of underpaid subcontractors “is the very antithesis of what investors mean by HCM,” said Michael Pryce-Jones, Teamsters’ senior governance analyst.
None of the retailers would discuss their logistics arrangements in detail.
Lowe’s on Jan. 24 asked securities regulators for permission to skip a vote on the Teamsters’ proposal, arguing among other things that it falls under an exemption for “ordinary business.”
Representatives for Lowe’s, Best Buy and Urban Outfitters did not respond to requests for comment.
A TJX spokeswoman declined to comment on the proposal but said TJX requires its service providers to comply with applicable laws and rules.
GROWING NOTICE
Heidi Welsh, executive director of the Sustainable Investments Institute, which tracks shareholder proposals, said filers look on track this year to match the record number of 115 HCM proposals filed for U.S. company meetings held in 2021.
The Teamsters resolutions, she said, could do well based on other votes last year on resolutions about working conditions, which won 52% support on average. But Welsh cautioned it remains to be seen whether the SEC will allow the vote. The SEC declined to comment.
The SEC in coming months also may suggest revisions to HCM disclosure rules. The Teamsters and other unions have urged the agency to mandate that companies include in their workforce disclosures details about individuals like contractors or drivers who are not on their payrolls but still matter to investors.
Tom Quaadman of the U.S. Chamber of Commerce, a leading trade group, said it would prefer the SEC stick with 2020 rules put in place when the commission was controlled by appointees of former U.S. President Donald Trump.
These encouraged companies to describe their human capital “to the extent such disclosures would be material to an understanding” of a company’s business, a simpler standard.
(Reporting by Ross Kerber; editing by Simon Jessop and Cynthia Osterman)
Source: One America News Network
