Managers Will Suffer Pay Cuts if a Union Organizes Employees

Menards, a massive home improvement chain store, has an employment agreement for managers which imposes a substantial pay cut if the workers under their supervision organize a union. A section in the employment agreement titled “Union Activity” provides that a manager’s income “shall be automatically reduced by sixty percent (60%)” of what it would have been if any union is recognized in the manager’s operation. The manager’s pay is likewise reduced by sixty percent (60%) if a union files a petition and wins an election.

The clause providing that managers are to be punished if a union succeeds appears in the employment agreement that all managers must sign as a condition of employment. One employee stated that “The mere mention of the word “union” is a workplace taboo.” Menards, funded and headquartered in Eau Claire, Wisconsin has more than 280 stores in fourteen states according to its website. The company’s owner, John Menard Jr. secretly funneled more than 1.5 million to a political advocacy group to support Wisconsin Governor Scott Walker.

Carin Clauss, an emeritus professor of law at University of Wisconsin-Madison believes the company might be vulnerable if a complaint is filed with the NLRB. The National Labor Relations Act prohibits employers from interfering with, restraining or coercing employees in the exercise of their rights to join a union. In Clauss’ opinion “You interfere with employees by threatening a third party.” Clauss suggested that an agreement that threatens managers with consequences if they don’t do something to interfere with employees organizing rights could be contrary to public policy and thereby void and unenforceable.

Stephanie Bloomingdale, Secretary-Treasurer of Wisconsin AFL-CIO said: “Shame on Menards. How are working people supposed to get ahead in this economy and work for a strong America when billionaires like John Menard are rigging the deck before working people even have a chance?”