UNITE HERE exposes problems in contracted food service at high tech and biotech companies

SAN JOSE-The High Tech-Biotech Corridor runs from San Jose up the Peninsula to South San Francisco.

These industries act as the economic engine of the Bay Area, providing jobs and technological innovation for the region. Santa Clara County has more than 110 big businesses, more than San Francisco and Alameda counties combined. While companies in the corridor are enjoying a period of renewed profitability, many of their subcontracted food service workers are living paycheck to paycheck and relying on government assistance for healthcare and other basic needs, according to a new report.

“As a single mother, making ends meet is hard,” says Claudia Rivera, a Guckenheimer cashier at Genentech. “I already use WIC to get things like milk and eggs for my daughter. I struggle with my rent, childcare costs and the high price of Guckenheimer health insurance. Recently, I’ve been considering getting a second job or getting on the county health insurance because my paycheck alone won’t let me support my daughter.”

“I like working at the Genentech Cafes, but our managers do not care about our health”, said Milarose Oriel, a Guckenheimer cashier at Genentech.” I had a stroke in 2001. I’m only 53 years old. I still want to see my granddaughter grow up, so I take my medicine and try to take care of myself. This year, I asked for time off to see my doctor to get my blood pressure medicine refilled. First, my manager kept telling me to postpone my appointment, then I had to beg her to give me some time off. My doctor actually called me because he was worried. The Guckenheimer health insurance is very expensive, too expensive for me to afford. I use a temporary insurance program offered by the government.”

Many high tech and biotech companies offer subsidized meals for their employees, yet taxpayers ultimately subsidize these company perks by shouldering the cost of health care that food service contractors fail to adequately provide.

“This is about the contrast between the jobs offered by high tech and biotech companies, where workers have subsidized day care, stock options and even sabbaticals, and jobs in the same buildings where food service workers have to turn to government aid for health care,” said Bruce Raynor, General President of UNITE HERE International Union.

This report highlights interviews with food service workers at Guckenheimer Enterprises and data on the ability of the subcontracted workforce to meet the cost of living. Findings include:

ï‚· A survey of more than half the 150 Guckenheimer workers at Genentech found that 23% rely on government funded health insurance or are uninsured. Only 50% rely exclusively on the company health insurance plan, which costs $200-$400 per month for family coverage.

ï‚· Food service workers report going to work sick or not receiving adequate medical care for injuries on the job, potentially causing health risks to their customers.

ï‚· Average weekly wages in the food service industry fall below what it costs a single adult to meet basic needs without public assistance.

ï‚· Food service workers on average earn 69% less than the median income for the area.

ï‚· The median income of Black and Latino families is less than the comparable self-sufficiency standard.

ï‚· The cost of living has risen 10% since 2000, and 46% of households that rent cannot find affordable housing. “This report provides a clear illustration of the impact on workers and taxpayers when pay is too low to meet basic needs and job-based healthcare is priced out of reach to working families,” says Ken Jacobs, Chair of the UC Berkeley Labor Center.

“Genentech claims to be neutral on the food service workers’ organizing drive,” says Barbara Ehrenreich, author of Nickled and Dimed and Bait and Switch. “It shrugs off the treatment of its food service workers, who are, after all, really the employees of Guckenheimer. But that excuse doesn’t wash any more. Whether it’s Wal-Mart or the University of Virginia, indignant citizens are demanding that companies take responsibility for their subcontracted labor.”

Companies should adopt a Responsible Contractor Code of Conduct to hold their contractors to the same standards of creating quality jobs with good wages and affordable health insurance. Codes of Conduct have been implemented in a variety of forms by public airports, city councils, pension funds, investment vehicles, and private companies.

“The report issued by UNITE HERE illustrates the difficulties faced by low wage workers in the food service sector with the increasing costs of living in our area,” said Congressman Tom Lantos. “I support UNITE HERE’s effort to consider a code of conduct for companies to require their contractors to be responsible employers by providing fair wages, comply with labor and environmental laws, be neutral toward worker organizing, and keep employees when contractors are changed.”

“Here in Silicon Valley, our community believes that people who work should be able to support their families,” said Phaedra Ellis-Lamkins, executive director of Working Partnerships USA. “By adopting a Code of Conduct, high-tech companies can take the lead in ensuring that their food service contractors live up to the community’s standards. We should all be working together to create quality jobs in our region.”

A Responsible Contractor Code of Conduct includes standards around fair wages, compliance with state and federal laws, labor peace requirements or neutrality toward worker organizing, and worker retention when contractors change.

Guckenheimer Enterprises is a one of the largest food service contractors at high-tech and biotech companies in the Bay Area. It services more than 120 companies in Northern California. The High Tech-Biotech Corridor runs from San Jose up the Peninsula to South San Francisco. Companies in the corridor are enjoying a period of renewed profitability.

UNITE HERE Local 2 represents hotel workers and food service workers in San Francisco and San Mateo County, including at the San Francisco Airport. UNITE HERE Local 19 represents hotel workers and food service workers in San Jose and Santa Clara County.