May 9, 2011


Pretoria, South Africa – A global coalition of trade unions will present its arguments on why Walmart should only be allowed to enter the South African market if it abides by certain conditions that will safeguard the economy and South African workers.

The South African Competition Tribunal resumes its hearings today on the proposed entry of Walmart into South Africa via the takeover of Massmart.

The global coalition of unions contesting the merger South Africa Commercial, Catering and Allied Workers Union (SACCAWU), UNI Global Union, and the United Food and Commercial Workers International Union (UFCW) of North America will present evidence showing that the Tribunal should only allow the deal to go through if Walmart agrees to conditions on treatment of workers, union rights and sourcing products locally.

“We have prepared a clear case that shows that Walmart has a history around the world of suppressing union and worker rights,” said Christy Hoffman of UNI Global Union, the worldwide union federation representing 20 million workers. “In countries where the company has not been legally obligated to accept a union, like the United States and Canada, it has brutally suppressed all of workers organising attempts. Even in countries where it was forced to accept a unionised workforce, Walmart has been attacking their rights every chance it gets.”

The South African Government will join the union coalition in presenting its concerns about the impact of the merger of the size of the proposed Walmart / Massmart transaction on employment and competition.

The government has demanded that binding conditions be put in place to hold Walmart accountable to the promises it is making the South African people, including respect of trade union rights and existing collective agreements, job security, local procurement and support for small business, respect for the rule of law and non-discriminatory practices in order to ensure that the deal does not undermine the New Growth Path.

To demonstrate Walmarts devastating effects, SACCAWU in conjunction with the UFCW solicited written testimony from international economists and labour experts to submit to the Competition Tribunal. This includes a new affidavit from Kenneth Jacobs, Chair of the University of California Berkeley Centre for Labour Research and Education. Jacobs has studied extensively Walmarts effects on workers and the local communities where it operates in the United States.

“Given Walmarts well-documented history of violations of labour and employment law elsewhere,” Jacobs said in his report, “if the Tribunal does elect to permit Walmart to acquire Massmart Holdings, Inc., conditions should be attached to the acquisition that would prove legal backing to Walmarts commitments to the Commission.”

Jacobs says that Walmart has depressed retail wages in the communities it operates and in many cases has put more costs on taxpayers because its employees are more likely to need public assistance for healthcare and other costs. He also says Walmart’s procurement model puts tremendous pressure on suppliers to cut costs, with the result that many suppliers have been shown to pay employees below the legal minimum wage or otherwise violate the law in order to meet the targets.

“In the United States, we have clearly seen the race to the bottom as the Walmart Model has come to dominate the industry,” said Michael Bride of the UFCW. “The Competition Tribunal has the opportunity to stop this from happening in South Africa and to impose conditions that will protect economic growth.”

The Tribunal hearings began in March but were postponed in order to allow the unions and government to share their evidence. Arguments will be heard for the next week.