Costco’s Petition Drive Violates Law, Union Says

Union officials charged Monday that Costco Wholesale Corp. is violating state law by requiring employees to man tables soliciting signatures for Gov. Arnold Schwarzenegger’s workers’ compensation reform initiative.

In a letter to Atty. Gen. Bill Lockyer, California officials of the International Brotherhood of Teamsters accused Costco of coercing its workers “to engage in political activity on behalf of an employer.”

Costco, which runs a nationwide chain of warehouse stores, including 100 in California, said it had done nothing improper or illegal and had not coerced workers.

“We’ve instructed our managers in every building in California that if any one of our employees is uncomfortable with soliciting signatures, they should go do something else,” said Joel Benoliel, Costco’s chief legal officer. “They’re not going to suffer any adverse consequences whatsoever.”

Costco, which is based in Issaquah, Wash., thrust itself into the middle of California’s raging workers’ compensation battle last week.

Schwarzenegger held a pro-initiative media event at a Costco store in the Sacramento suburb of Roseville on Wednesday. Two days later, Costco Chief Executive Jim Sinegal announced that his company had ordered enough petitions to gather as many as 900,000 signatures at its California outlets. Proponents of the initiative must collect at least 598,000 valid signatures from registered voters by April 16 to appear on the November election ballot.

The governor repeatedly has warned that he will use the ballot box to change the state’s costly system for helping injured workers if lawmakers don’t send him a workers’ comp reform bill in the next few weeks.

Negotiators in the statehouse, meanwhile, said Monday that they were continuing to make progress on finding a legislative fix for the workers’ compensation system, although the talks remained cloaked in secrecy. Various legislative and lobbying sources predicted that a proposed deal could be presented to lawmakers for debate later this week.

The Teamsters have actively participated in the closed-door meetings, said Chuck Mack, the union’s Western region vice president.

“We know there are going to be changes in the law, and we’ve been cooperating with management in an attempt to come up with a solution,” he said.

But Costco’s alleged efforts to politicize the workplace could “submarine the process,” Mack said.

In his letter to Lockyer, Mack alleged that Costco was breaking a section in the California Labor Code that “strictly prohibits an employer from adopting any policy which has the effect of controlling or directing or tending to control or direct the political activities or affiliations of employees.”

The Teamsters union represents about 40% of Costco’s 30,000 California employees, Mack said.

Costco’s frustration with California’s workers’ compensation system is not new. In September, the company gathered 525,000 signatures from shoppers on petitions it sent to the Legislature asking for reforms that could cut business premiums in California, said Beth Miller Malek, a spokeswoman for the initiative campaign.

Costco spends more on workers’ comp insurance in California than in all the other 35 states where it operates combined, Benoliel said. A third of Costco’s workforce is in California, but the state accounts for 70% of its workers’ compensation costs, he said.

Tom Dresslar, a spokesman for Lockyer, confirmed that the attorney general’s office had received the letter and was evaluating the Teamsters’ request for an investigation.