Virginia Mayo/AP Photo
Microsoft President Brad Smith addresses a media conference regarding Microsoft’s acquisition of Activision Blizzard and the future of gaming, February 21, 2023, in Brussels.
Last week, Microsoft announced that it wouldn’t oppose efforts by any of its roughly 100,000 employees to form or join a union.
In other parts of the world, there’d be nothing earthshaking about such an announcement; it’s actually common practice in Europe and elsewhere. In these United States, however, it makes Microsoft “a unicorn” among its peers, as one union official put it. The last major American corporation to pledge it would let its employees decide whether to unionize free from corporate opposition was—well, I can’t think of one, though I’ve been on this beat for roughly 45 years.
Lest you think all the stars in the heavens have shifted course, rest assured that they have not. Even as this foundational company of high tech has accepted the notion of employee rights, the redoubtable Elon Musk has made clear that he hasn’t. In just the past few weeks, Musk has intoned that “I disagree with the idea of unions,” and further accused them of fostering a “lords and commoners” system that divides managers and owners from workers. (Of course, any number of current and former employees of Twitter, now X, might view Musk himself as the lord who changed the company over their objections and, in the case of the formers, gave them the axe.)
Musk’s default mode is outrageous overstatement, but in this case, what he’s overstating is really the almost universal creed of American corporate leaders. From Starbucks to Walmart, and all across the libertarian cocoon that is Silicon Valley, CEOs and their private equity or hedge fund overlords view unions as anathema. Which raises the questions of why and how Microsoft chose to be different.
THE STORY BEGINS WITH MICROSOFT’S EFFORTS to buy Activision, the video game producer. The proposed purchase raised antitrust concerns, which led Microsoft officials to meet with Rep. David Cicilline (D-RI), who then chaired the House subcommittee dealing with antitrust issues. (Cicilline has since left Congress.) Cicilline told them that their bid for Activision needed to win some union backing, which brought Microsoft to the doorstep of the Communications Workers of America (CWA), the union most active in organizing tech workers. At the time, CWA was working on organizing employees at Activision (ultimately, successfully).
Microsoft did indeed reach out to CWA, with an offer not to oppose the union’s organizing campaign, in return for which CWA, quite understandably, supported its efforts to buy Activision. (The Federal Trade Commission did challenge the merger, but a judge dismissed the case, allowing it to go forward.)
The connection, once made, went deeper. What made the difference, according to CWA officials, was Brad Smith, Microsoft’s president and vice chair. Smith actually knew about CWA; his father had headed AT&T, a company whose employees had been CWA members since the 1940s, in Wisconsin. During (and before and after) his father’s tenure, CWA had struck regions of AT&T on numerous occasions. CWA was one of the very few unions that kept striking during the Reagan presidency and its long aftermath, because, unlike almost any other union, it kept winning its strikes. But it never struck in Wisconsin; Smith’s father and CWA had always found ways to reach mutually acceptable solutions to problems that caused strikes elsewhere.
From Starbucks to Walmart, and all across the libertarian cocoon that is Silicon Valley, CEOs and their private equity or hedge fund overlords view unions as anathema.
Brad Smith also had an uncle who worked as an AT&T lineman, who, according to CWA sources, developed neurological conditions that could be connected to his regular exposure to certain kinds of lead on the job. Smith reasoned that this was the kind of issue where a union could serve as an early-warning system to the company if and when its members began falling ill.
Many former officials in both the Clinton and Obama administrations have gone to work for Silicon Valley companies. At Microsoft, as was not the case elsewhere, one of those former officials brought with her a distinctly pro-worker sensibility. Portia Wu had worked on labor issues while on the senatorial staff of Ted Kennedy, for decades the most pro-labor member of the Senate; she had also served as Maryland’s secretary of labor under Democratic gubernatorial administrations there. Some CWA officials had known and worked with her in her former jobs; they initiated an ongoing dialogue that enabled them to explain to Microsoft executives what employer neutrality meant in the context of union organizing.
But the real key was Smith, who, almost alone among his fellow corporate leaders, didn’t demonize unions and understood the role that they could play in actually helping companies surmount some challenges, beginning with, but hardly limited to, Microsoft’s Activision acquisition. It was a stroke of luck that the union he knew best was also the union most active in his industry. It also helped that CWA has a reputation as a strategically savvy, unusually effective (see: strikes) and honest labor organization.
And finally, Smith isn’t Microsoft’s founder, and doesn’t have that longtime attachment to the company that makes them see union organizers as a personal affront. That’s the stance we see with people like Howard Schultz, and Elon Musk.
IN AMERICA’S C-SUITES, WHEN IT COMES TO UNIONS, Musk, not Smith, is the norm. Musk’s immediate problem is that he’s not only in America anymore. His anti-union ferocity is way outside the norm throughout much of Europe and most especially in Sweden, where his refusal to recognize a union for Tesla’s roughly 130 auto mechanics there has encountered a level of pushback almost without precedent.
Sweden is the most heavily unionized nation on the planet, with fully 90 percent of its employees organized. Musk’s refusal to recognize the union or to allow his workers to bargain with Tesla has not only led the union, IF Metall, to strike Tesla’s Swedish tune-up facilities, but led other unions to refuse to do business with Tesla. Dockworkers, not just in Sweden but in the neighboring Nordic nations of Denmark and Norway, now refuse to unload new Teslas bound for sale in Sweden (Tesla has no factories in Sweden). Postal union members now refuse to deliver license plates to Tesla’s sales facilities. And municipal employees are refusing to pick up the trash outside those facilities and the tune-up shops. (These kinds of “secondary strike” actions were common in the U.S. in the years between the enactment of the National Labor Relations Act in 1935 and the 1947 passage of the Taft-Hartley Act, which brought an end to the period of unions’ explosive growth.)
Musk’s ambitions have never been confined to the United States, but in going global, he’s encountering labor rules that are far more stringent than those in America.
Musk clearly fears that if he agrees to his Swedish mechanics’ bid to unionize, it could lead to the unionization of far larger numbers of Tesla employees, beginning with the several thousand who work at Tesla’s massive factory in Germany, where an organizing campaign is well under way. Even in the U.S., where labor law has long been tilted in management’s favor, the UAW’s recent success in winning substantial gains in its new contracts with GM, Ford, and Stellantis must make Musk wary about the UAW’s just-now-launching campaign to unionize the non-union European, Japanese, and Korean transplant factories in Southern states, and Tesla’s three factories, which are in California, Nevada, and Texas. (As the Prospect has written, one Tesla worker who was fired for union organizing still hasn’t been rehired six years later, despite multiple administrative bodies and courts siding with him.)
A bit of the cross-national solidarity that European unions have demonstrated on behalf of Sweden’s Tesla employees might also be useful in helping the UAW in its efforts to unionize the Volkswagen, BMW, and Mercedes Benz factories in the South. In its previous effort to organize Volkswagen’s Chattanooga factory, the German auto union, IG Metall, used its voting power on the company’s board (under German law, large companies are required to give worker representatives half the seats on their supervisory boards) to compel VW management not to oppose that campaign. The UAW lost that campaign largely due to the anti-union propaganda of local and state Republican elected officials. IG Metall can re-up that neutrality position for the new campaign at VW, and help the UAW win similar commitments from the other German automakers whose factories it is now targeting.
Musk’s ambitions have never been confined to the United States, but in going global, he’s encountering labor rules that are far more stringent than those in America. In the UAW, he’s also encountering a union with serious momentum, something that’s been a rarity in the U.S. for the past 45 or so years. Where Brad Smith went at least somewhat voluntarily, Elon Musk needs to be brought kicking and screaming. Of course, kicking and screaming is Musk’s normal condition, so it will take more than that.
