Names In the News

Walmart Fined for Death

The Occupational Safety and Health Administration (OSHA) has cited Walmart Stores Inc. for inadequate crowd management following the November 28, 2008, death of an employee at its Valley Stream, New York, store.

The worker died of asphyxiation after he was knocked to the ground and trampled by a crowd of about 2,000 shoppers who surged into the store for its annual “Blitz Friday” pre-holiday sales event.

OSHA’s inspection found that the store’s employees were exposed to being crushed by the crowd due to the store’s failure to implement reasonable and effective crowd management principles.

This failure includes providing employees with the necessary training and tools to safely manage the large crowd of shoppers.

OSHA issued Walmart one serious citation under its general duty clause for exposing workers to the recognized hazard of being crushed by the crowd.

The citation carries a proposed fine of $7,000, the maximum penalty amount for a serious violation allowed under the law. OSHA issues serious citations when death or serious physical harm is likely to result from hazards about which the employer knew or should have known.

“Effective planning and crowd management could have prevented this incident and its grave consequences,” says Robert Kulick, OSHA’s regional administrator in New York. “Walmart must now take steps to ensure that a situation such as this one never happens again.”

Union Busting Surge

Employers have been emboldened by the global economic and political climate to act more aggressively and more punitively against workers.

That’s the conclusion of “No Holds Barred: The Intensification of Employer Opposition to Organizing,” a May study by Cornell University Professor Kate Bronfenbrenner.

The study finds that private sector employer opposition to workers’ efforts to form unions has intensified and become more punitive than in the past.

Employers are more than twice as likely to use 10 or more tactics — including threats of and actual firings, threats of and actual plant closings, harassment, disciplinary actions, surveillance, and alteration of benefits and working conditions — in their campaigns to thwart workers’ organizing efforts. At the same time, employers are less likely to offer “carrots,” such as unscheduled raises, positive personnel changes, bribes, special favors, social events, promises of improvement and employee involvement programs.

“It’s almost as if employers today have the attitude — we don’t care, we don’t have to care about the law, about public opinion,” Bronfenbrenner says. “We don’t do the carrots. We just do the stick.”

The report provides a comprehensive independent analysis of employer behavior in union representation elections supervised by the National Labor Relations Board (NLRB), from 1999 to 2003. Bronfenbrenner finds:

• 63 percent interrogate workers in one-on-one meetings with their supervisors about support for the union;
• 54 percent threaten workers in such meetings;
• 57 percent threaten to close the worksite;
• 47 percent threaten to cut wages and benefits; and
• 34 percent fire workers.

SEC Charges Mozilo

The Securities and Exchange Commission (SEC) in June charged former Countrywide Financial CEO Angelo Mozilo and two other former executives with securities fraud for deliberately misleading investors about the significant credit risks being taken in efforts to build and maintain the company’s market share.

Mozilo was additionally charged with insider trading for selling his Countrywide stock based on non-public information for nearly $140 million in profits.

The SEC alleges that Mozilo, along with former chief operating officer and president David Sambol and former chief financial officer Eric Sieracki, misled the market by falsely assuring investors that Countrywide was primarily a prime quality mortgage lender that had avoided the excesses of its competitors.

The SEC’s enforcement action alleges that from 2005 through 2007, Countrywide engaged in an unprecedented expansion of its underwriting guidelines and was writing riskier and riskier loans, which these senior executives were warned might ultimately curtail the company’s ability to sell them. Countrywide was required to disclose these important trends to its investors in the Management Discussion and Analysis portion of its SEC filings, but failed to do so.

“This is a tale of two companies,” says Robert Khuzami, director of the SEC’s Division of Enforcement. “Countrywide portrayed itself as underwriting mainly prime quality mortgages using high underwriting standards. But concealed from shareholders was the true Countrywide, an increasingly reckless lender assuming greater and greater risk. Angelo Mozilo privately described one Countrywide product as ‘toxic,’ and said another’s performance was so uncertain that Countrywide was ‘flying blind.’”

— Russell Mokhiber