DANVILLE, Va. — When home- furnishing giant Ikea selected this fraying blue-collar city to build its first U.S. factory, residents couldn’t believe their good fortune.
Beloved by consumers worldwide for its stylish and affordable furniture, the Swedish firm — which is building its first Colorado store in Centennial — had also constructed a reputation as a good employer and solid corporate citizen. State and local officials offered $12 million in incentives. Residents were thrilled at the prospect of a respected foreign company bringing jobs to this former textile region after watching so many flee overseas.
But three years after the facility opened here, excitement has waned. Ikea is the target of racial discrimination complaints, a heated union-organizing battle and turnover from disgruntled employees.
Workers complain of eliminated raises, a frenzied pace and mandatory overtime. Several said it’s common to find out on Friday evening that they’ll have to pull a weekend shift, with disciplinary action for those who can’t or don’t show up.
Kylette Duncan, among the plant’s first hires, quit after six months to take a lower-paying retail job.
“I need money as bad as anybody, but I also need a life,” said Duncan, 52. She recalled having to cancel medical appointments for her ailing husband because she had to work overtime at the last minute.
Some of the Virginia plant’s 335 workers are trying to form a union. The International Association of Machinists and Aerospace Workers said a majority of eligible employees had signed cards expressing interest.
In response, the factory — part of Ikea’s manufacturing subsidiary, Swedwood — hired the law firm Jackson Lewis, which has made its reputation keeping unions out of companies. Workers said Swedwood officials required employees to attend meetings at which management discouraged union membership.
Plant officials didn’t return calls and declined to meet with a Los Angeles Times reporter who visited the Virginia facility.
Swedwood spokeswoman Ingrid Steen in Sweden called the situation in Danville “sad” but said she could not discuss the complaints of specific employees. She said she had heard “rumors” about anti-union meetings at the plant but added that “this wouldn’t be anything that would be approved by the group management in Sweden.”
Big news in Sweden
The dust-up has garnered little attention in the U.S. But it’s front-page news in Sweden, where much of the labor force is unionized and Ikea is a cherished institution. Per-Olaf Sjoo, the head of the Swedish union in Swedwood factories, said he was baffled by the friction in Danville.
Ikea’s code of conduct, known as IWAY, guarantees workers the right to organize and stipulates that all overtime be voluntary.
“Ikea is a very strong brand, and they lean on some kind of good Swedishness in their business profile. That becomes a complication when they act like they do in the United States,” Sjoo said. “For us, it’s a huge problem.”
Laborers in Swedwood plants in Sweden produce bookcases and tables similar to those manufactured in Danville. The big difference is that the Europeans enjoy a minimum wage of about $19 an hour and a government-mandated five weeks of paid vacation.
Full-time employees in Danville start at $8 an hour with 12 vacation days — eight of them on dates determined by the company.
Low prices have helped Ikea weather the economic downturn. The company made 2.7 billion euros in profit last year, up 6.1 percent from 2009, according to its most recent financial statements.
Still, last fall, Swedwood eliminated regularly scheduled raises and made cuts to some pay packages in Danville. Starting pay in the packing department, for example, was reduced to $8 an hour from $9.75. Steen said the changes were made to free up more money to pay incentive bonuses to top performers.
“Most strict place”
Current and former plant employees said they resented the unpredictable work hours and high-pressure atmosphere. The plant assesses penalty points for violations of work rules; workers who accumulate nine of them can be fired.
“It’s the most strict place I have ever worked,” said Janis Wilborne, 63, who worked at the plant for two years and quit last year.
Six African-American employees have filed discrimination complaints with the Equal Employment Opportunity Commission, claiming that black workers at Swedwood’s U.S. factory are assigned to the lowest-paying departments and to the least desirable shift — 11 p.m. to 7 a.m.
“If we put in for a better job, we wouldn’t get it — it would always go to a white person,” said Jackie Maubin, who worked the night shift in the packing department until last year, when she was fired on her birthday.
Swedwood has been trying to settle four of the discrimination complaints through mediation. The company initially offered Maubin $1,000. She settled for $2,000. She said she needed the money to keep her car from being repossessed.
