Real Change News | Janitorial franchisor rips off immigrants, union says

July 7, 2010
Vol: 17 No: 27

News

Janitorial franchisor rips off immigrants, union says

by: Cydney Gillis , Staff Reporter

A frosty greeting on the street

Janitors at Seattle's Norton Building used to be union members with benefits, says SEIU Local 6 organizer Jorge Quiroga, but that changed in January when OpenWorks, a franchise company, took over the Norton's janitorial service. Quiroga and other SEIU memners put up a tent city in from the building last week to protest.

Photo by: Cydney Gillis , Staff Reporter

Printer-Friendly Version

Like it? Share it!

A giant inflatable of Frosty the Snowman looks out of place on a downtown sidewalk in the middle of summer. But for drivers passing by, it’s an eye-catcher – and it has a broom.

That’s the part that Seattle’s janitors union wants people to focus on as they drive or walk past the Norton Building on Second Avenue. Frosty isn’t there to advertise a “Christmas-in-July” sale; he was put up with tents and signs last week to call attention to union jobs that the union says have literally been sold off by a national franchise company.

Last year, says Jorge Quiroga, an organizer with Local 6 of the Service Employees International Union, the Norton Building put its janitorial contract out to bid and, rather than renewing its contract with Pacific Building Services, a union company, it chose OpenWorks, a franchise company.

OpenWorks doesn’t do the work itself, Quiroga says. Its business model is to analyze what it will take to clean a building, write up a contract and then sell the contract to small, typically immigrant-owned janitorial companies for between $5,000 and $30,000. The franchisee companies pay the fee up front, he says, on the promise that the contract will bring upwards of $5,000 a month in work.

That sounds good, says fellow SEIU organizer Emily Sokolski, until the company starts the job and discovers that OpenWorks has underbid it and they and their workers are making minimum wage or less. She points to three lawsuits that franchisees have filed against OpenWorks in King County since 2004 claiming just that: that OpenWorks misrepresented the income potential of its contracts.

In one lawsuit, Chet Brown, a former operations director for OpenWorks’ regional office in Bellevue, signed an affidavit saying that salespeople routinely underbid the jobs and failed to explain a contract termination clause to franchisees whose English skills made it difficult to read a contract. “OpenWorks’ business practices, particularly the underbidding of jobs,” Brown stated, “exploits these immigrants.”

Since January, Quiroga says, a small OpenWorks franchisee company has employed about the same number of janitors as Pacific Building Services did at the Norton Building, but the five or so workers are paid less ($10 an hour compared to $13.75 under the union contract) and only have health coverage because the franchisee at the Norton Building has decided to offer it. OpenWorks itself offers no health plan to workers.

Under the Local 6 contract, Quiroga says, janitors and their families are covered without having to pay any premium – something that Joe Kenny, property manger for the building, calls a “Cadillac plan” in these times of penny-pinching.

Like other landlords, Kenny says, the 17-story Norton Building – which was built in 1959 by a president of lumber giant Weyerhaeuser and is controlled by his family’s Laird Norton investment company – has been hit hard by the recession and was looking to save any money it could last year when it put the Norton Building’s janitorial contract out for bid.

The bids that came back were surprising in their difference, Kenny says. When he dug deeper, he says, he found that the main difference in the cost wasn’t the wages, but the health coverage.

“It makes the union contracts so much more expensive because the union-contract janitors get 100 percent premium coverage for both themselves and their dependents,” Kenny says. “To have a health care plan for the janitors that’s better than my health care plan, or better than anybody who works in the building, just seems odd to me.”

The union has had a lock on downtown Seattle’s janitorial contracts for 50 years, he says. As a result, most building owners are reluctant to switch to non-union companies like OpenWorks, he says, because SEIU will do exactly what it’s doing now at the Norton – picket. “It’s kind of a throwback and we’re caught in the maelstrom,” Kenny says. “I have great respect for the unions, but they have to make a political statement.”

But that statement, Quiroga says, isn’t about the Norton Building wanting to save money – it’s that it hired OpenWorks to do it. “The issue is the franchise,” Quiroga says. “They hired a franchise that is a predatory entity, then [it preys] on the immigrant community.”

----