VALUE VILLAGE? SOME MIGHT SAY “VALUE PILLAGE!”

Editor’s Note: the following story, which was thoroughly researched during a period extending from mid – 2006 to mid – 2007, was offered to several Lower Mainland newspapers. Few expressed an interest in it. The only newspaper that did express an interest, in the end, reluctantly refused to run it because all of the anonymous sources quoted (two of which I had spoken to personally) were afraid to let their names be made public because they feared repercussions from Value Village. Or they feared that friends still working in Value Village would be harassed by the chain’s management. The other sources were communicated with through email and the interviews were carried on it that fashion; they generally validated the claims made by the other people I had met.

I repeatedly attempted to contact various members of Value Village management by email but no responses were ever forthcoming.

A HELL HOLE WITH LOCAL PROFITS AS HIGH AS
$8 MILLION, SOME SAY

“A hellhole!” is how some past and present Value Village staff members, about 80 % women, have described working conditions at Lower Mainland outlets of North America’s largest seller of used clothing and second hand goods.

The Value Village chain enjoyed Canadian sales in 2006 of more than $240 million (74 stores), and had in 2004 an estimated net profit in British Columbia (14 stores) ranging from $9.3 to $14 million on gross sales of $46,689,015. The chain’s US parent, Savers Inc., in August 2006, had a $500 Million estimated value.

The same confidential company sources indicate Value Village’s 11 stores in Richmond, Vancouver (2), Surrey, Haney, Langley, Coquitlam, Clearbrook, Burnaby and Chilliwack, with gross sales of $27,413,375, probably had net profits ranging from $5.4 to $8.1 million in 2004.

BEHIND THE SCENES AT VALUE VILLAGE: BLACK MOULD, SPIDERS AND ANIMAL CORPSES?

Many employees posting on the Retail Workers website at the Retail Workers website describe crowded, poorly ventilated backrooms piled high with bags of clothing sometimes containing black mold, bedbugs, spiders and even dead animals. Such claims have been supported by local employees.

The September/October 2001 Archives of Environmental Health told how Black Mold (Stachybotrys) spores, which contain Macrocylic Trichothecenes, may cause harm when inhaled or ingested.

Lower Mainland store employees also face harassment from vindictive and inconsistent supervisors.

AN EX-SUPERVISOR’S STORY

One former three year employee, an ex-supervisor at three local Value Village outlets, told me how, in late January 2006, she was instructed by her doctor to take two weeks of stress leave. Indicating her intention to step down from her position upon returning to work, she notified management of the doctor’s order.

Upon returning, she assumed she would work as an ordinary employee – a “Team Member”, as company lingo puts it.

In a back room storage area where she met the District Manager (DM) and a manager from another store, she was verbally attacked for her clothing style.

The DM also said company policies did not allow “step-downs” to non-supervisory positions. Upon the ex-employee’s offer to transfer to another store, she was told such lateral moves were also not company policy. This ex-employee claimed to know of three people (one a friend of the DM) from two stores who have stepped down from management to team member hourly positions – and to different stores. The District Manager did not respond to emailed requests for an interview concerning this and other claims by ex-employees.

The woman had other complaints.

“[During the meeting] the DM suggested I go home and [consider] whether I could support changes needed to make the store successful. [The DM] told how pleased she was at my decision to support such changes,” she recalled.

However, upon returning the next day, she received very shabby treatment: she was terminated.

AN EX-MANAGER’S STORY

In a somewhat related case, that same particular store’s manager, upon taking emergency medical leave, had written down exhaustive “to do” lists for her absence. However, few of her instructions were heeded and things worsened in the store. Making sure that both supervisory and regular members of the recovering woman’s team stayed with Value Village until she returned, the company promised to improve working conditions.

“[However] the DM tried to fill empty supervisory positions with her friends,” the former manager recalled.

The DM, while the former manager was recovering, had seemed supportive.

“However, upon my arrival at corporate headquarters, I was suspended for 12 days with pay,” the former manager recalled.

She was blamed for events during her absence – employee theft, dress codes being ignored, improper locks on the employee lockers and plugged toilets. This woman told me that, during the same time she was accused of these infractions, the company’s regional office was not enforcing dress code or lock policies on its Burnaby outlet located beneath its own premises at Kingsway and Edmonds.

VALUE VILLAGE IS AN INTERNATIONAL FOR PROFIT CORPORATION THAT DONATES TO CHARITY

Many people wrongly think Value Village is a charitable organization, with all its profits going to worthwhile causes.

In fact the company, founded by Bill Ellison in 1954 in San Francisco, is now an international for-profit thrift store operation run from Bellevue, Washington by Ellison’s son, Tom.

After purchasing merchandise from non-profit vendor organizations like charities, it resells to the public through its chain of 208 retail thrift stores in Canada, the United States and Australia, employing more than 9000 people worldwide.

Growing strongly and now known as Savers Inc., the company claims it benefits more than 110 local non-profit organizations by purchasing and reselling donated items, and says it has paid over one billion dollars directly to its partner charities since its founding. Between 1995 and 2005, it grew from 100 to over 200 stores, and aims for further growth.

Value Village’s website claims contributions to seven BC charities – five branches of the Big Brothers and Sisters Organization (BBBS), the Canadian Diabetes Association's (CDA) Clothesline and the Developmental Disabilities Trust (DDT). According to the web site, The BBBS organizations are located in Kamloops, Kelowna, Prince George, Vancouver and Victoria. The Canadian Diabetes Association’s head office is in Ottawa and the Developmental Disabilities Trust is located in Richmond.

Information received from the manager of Greater Vancouver branch of the BBBS organization says that the total contribution to the end of 2006 by Value Village amounted to $10,000 for a mentoring program in Chilliwack.

Not all its “partners” in the BC charity community stay thrilled with Value Village.

PRINCE GEORGE BIG BROTHERS WAS NOT HAPPY WITH VALUE VILLAGE’S NEW DEAL AND ENDED ITS CONTRACT

The Prince George branch of BBBS ended its seven-year connection with Value Village in mid-2005.

“Our Board made the decision [to end the relationship] based on the fact that [Value Village] had unilaterally reduced the amount they paid us on the product received at the store…without renegotiating our contract,” explained Executive Director Sandy Whitwham.

“They also proposed a new three year contract with annual reductions of 25 cents per okay (the company’s delivery unit) in the price they paid as well as [annual reductions] in the amount of product they would take from us,” she remembered.

Whitwham said Value Village also wanted more furniture and “miscellaneous” items, neither of which the charity would be paid for – and fewer cloth goods, for which it was paid – and a 2 year non-competition clause.

“Our net income would have [been about] $36,000 per year lower by the end of the proposed contract,” she said.

A central problem for major charities dealing with Value Village is that they are forced to negotiate in isolation.

“[This is a condition] of the Value Village contract - to not disclose the specifics of our individual contracts,” stated the Director.

KELOWNA BIG BROTHERS IS A VALUE VILLAGE SUCCESS STORY

On the other hand the Kelowna BBBS organization seems thrilled with Value Village. Given access to the Regional District’s Kelowna Landfill, that chapter has been able to sort through the incoming waste stream, creaming off the good stuff for the company.

An April 10, 2005 issue of the local Kelowna Capital News Report reported on the charity’s earnings from Value Village.

The Kelowna Renew Crew sells the items it collects to Value Village and is paid a flat fee per pound. Last year, the program raised $200,000 and diverted 1.9 million pounds of clothing and 860,000 pounds of household goods from the landfill.

Figures for 2004, the last year for which I have been able to obtain information, the Kelowna Value Village store had gross sales of $3,899,082. Given an average net profit ranging from 20% to 30% of gross sales, this means that the Kelowna store earned between $780,000 to $1,170,000.

SMALLER LOWER MAINLAND CHARITIES AFFECTED BY VALUE VILLAGE POLICY CHANGE

Early last summer a controversy concerning arose concerning a substantial funding loss to about 70 smaller Lower Mainland charities, formerly serviced by BBBS Renew Crew. In the last several years BBBS set up partnerships with the smaller charities.

Under these partnerships, BBBS Renew Crew received about 9600 bags per month – worth about $70,000 to BBBS upon sale to Value Village, and about $18,000 to the small charities. A BBBS source estimated that the smaller charities provided about 28% of the larger charity’s income.

Beginning in October 2005, BBBS was forced to abandon dozens of the small un-affiliated thrift shops. In some cases, these thrift shops have been picked up by CDA and DDA.

Value Village told BBBS and Renew Crew that the pick-up service was no longer acceptable. The policy essentially forbids BBBS from delivering tagged goods from other thrift stores to Value Village.

Feeling the consequences of the shift were thrift stores run by the SPCA, Bibles for Mission, Union Gospel Mission, Canadian Mental Health, Second Story Treasures, Meadow Ridge Women in Need, *Delta Youth Support Line, Delta Hospice, Surrey Hospice, Treasure Cottage, Richmond Hospital Auxiliary and others.

One of my sources within the small thrift stores claimed at the time that the policy was not being applied equally to BBBS, the CDA and the Richmond-based DDA. (Figures below are for 2004)

Health complaints and safety issues are rife at Value Village with many staffers linking working conditions to acne, irregular menstrual cycles, bronchial infections and other maladies.

MORE HEALTH COMPLAINTS, BUT NONE REPORTED TO HEALTH AUTHORITIES

A Langley woman, “Miss Monster”, described her first two weeks of Value Village employment.

“[As well as miscarrying] in my first month of pregnancy, I also had insomnia and was coughing up black shit. I was so sick I could barely walk or drink anything.”

She believes she was sickened by the black mold permeating her store’s air. She was also severely bitten by bedbugs and pulled her groin twice.

Neither the Fraser Health nor the Vancouver Coastal Health Authorities have reported complaints related to Value Village.

“Susannah”, also employed for three months in mid-2005 in a Lower Mainland store, agreed that many Value Village outlets are toxic workplaces.

“Most women I worked with were sick a lot, colds mostly and chest infections.”

“I … have never felt so abused by management in my life”, she said, describing how she and her fellow workers opened donation bags loaded with filth, two loaded handguns, bear parts, dead mice, dead kittens, used sex toys, used feminine hygiene products and animal feces. Also rampant were spiders, mold, mildew, fleas, and other insects.

She saw many injuries on the job. “I witnessed women falling, slipping and banging their heads on the rails in the production dept. Most weren't given any sympathy or concern at all [but were] encouraged to resume their duties after five minutes’ recuperation,” she recalled.

Once, following a hot August day’s power outage, she was directed by management to clear the electrical room of housekeeping equipment, sale signs and assorted other stuff, before BC Hydro showed up to re-set the power – and to put it all back after Hydro crews left.

Truck fumes from the loading dock flooded into the production area. Staff members were also subjected to non-stop noise.

“Music in the production room was cranked high to discourage women from talking – which also prevented us from hearing warnings when dangerous situations occurred.”

“The only person allocated gloves for hygiene purposes was the "sorter", the rest of the production line, hangers, pricers etc were given none,” she explained.

FOUR TONS A DAY OF WORK EXPECTED

Backroom employees working a certain merchandise stream at one Lower Mainland store are expected to meet the following quotas during their shift: women’s wear 2000 items, men’s 800 - 900, children’s/infants’ 750, house wares 1200, bed & bath 800, book 450, footwear 200 and garage150. These quotas often put a great deal of stress on employees. For example, 2000 women’s wear items per shift works out to approximately four and a half items per minute.

Workers on the incoming end of things are expected to sort at least seven carts (about four tons) a day although, as one former store manager told me, they would prefer to get “eight out of you”.

All new employees start off at about $9 per hour, which increases at six months and then on annual basis – if they pass a performance review.

When a store’s sales target is met, all store employees receive a bonus.

“[But not very often], because [sales targets] are set ridiculously high,” cautions the former manager, mentioned above.

According to this former store manager, the average Lower Mainland outlet, with a staff about 20 and open about 70 hours per week, spends about $12,600 per week on wages. Expected revenues would be about $25,000 per day or $175,000 per week.

Average weekly income for Lower Mainland and Island stores ranged from $40,000 to $107,000 per week – the latter number a one week total for the Victoria, Vancouver Island, store.

“…the total bottom line for all stores ranges between $30,000 and $65,000 per week,” she estimated.

A LOCAL DEEP THROAT

An executive suite member calling himself Deep Throat put the value of donations in a different light: charities, when contracting with Value Village, promise that 25% of the goods that they bring to the store will be “hard” goods and miscellaneous items – for which they will not be paid.

This means, he indicated, that if one calculates the total amount of goods the charities bring to the store and compares that amount to the under 75% of the goods for which they are actually paid (soft goods like clothing), the unit cost to Value Village falls to about $7.44 per Okay.

“Deep Throat” summarized Value Village’s 2004 fiscal situation in Canada as follows: “second hand” sales were $240,968,381 for Value Village along with $8,770,953 in Halloween sales (from which the company pays nothing to its charity partners) for total sales of $250,729,287.

“Generally speaking [profits] range from 20-30%. Depending on the location...some might actually run as high as 35%.”

VALUE VILLAGE, BERKHSIRE PARTNERS AND FREEMAN SPOGLI: HIGH FINANCE TO RAISE $500 MILLION

Recent years have seen some high value transactions involving Value Village and its American parent company, Savers Inc. In 2000 the Ellisons sold half their shares to the U.S. private-equity firm Berkshire Partners LLC Berkshire Partners LLC of Boston, Massachusetts.

In early June 2006 the National Post reported that Berkshire Partners was seeking a buyer for its $500 million share in Value Village.

On August 11, 2006 the deal had sold its share in Savers to Freeman Spogli, a private $14 billion New York and Los Angeles investment firm, had purchased its shares.

This recent deal, according to a highly placed Value Village source, led to some executive suite members who had been given shares back in 2000 making some big bucks.

“...Value Village has now purchased their shares back from Store manager and above... The payouts were a minimum of $17,000 for store managers and hundreds of thousands dollars for positions above that level,” he explained.

UNIONS USUALLY UNSUCCESSFUL – EXCEPT IN SUDBURY ONTARIO

Employees fear seeking union membership or certification. One remembered how, “The company’s management harasses people who favour unions..”

In New Westminster in 1988 the General Workers Union (later taken over by the BCGEU), after being approached by employees of the company, tried to negotiate a contract including a raise but, in the end, the company closed the store.

Another unsuccessful attempt occurred in Prince George in 1998.

In 2002 the Canadian Autoworkers Union tried to certify the Whitby, Ontario store. Certification was achieved but, after three years and three attempts, the employees voted to decertify in 2005!

CAW National Organizer John Aman thought the employees’ decision to decertify probably arose from two reasons – high staff turnover and the fact that small stores were harder to organize.

However, for BC and Lower Mainland Value Village workers, seeking job improvement through union membership, the Sudbury, Ontario store may provide a helpful direction.

That store’s 48 workers, after a certification drive that began in April 2006, very recently signed their first contract, which featured a 10-cent per hour raise.

“[Management told us] that [we] were like family and we could work together to work out our differences,” a woman named Shawna explained, noting that the successful unionization had directly resulted from management favoritism and unsafe working conditions.

In one covered-up instance, a young woman was struck on the head by a heavy plastic container, due to negligence by a fellow employee, a supervisor’s nephew, who was not disciplined.

“Injury reports were not being filled out right away [or wrong dates were entered] … which could result in the cancellation of your compensation benefits,” she said.

The new contract has led to some significant improvements in working conditions. As well as getting the Sudbury Civic Holiday off, store employees have first choice of available jobs before management can recruit from outside.

“[This] will allow [part-time] people in the front (the operations section) seeking full time work in the back (production) a chance to get the job before management can look [elsewhere],” she explained, adding that she now expects less turnover in the store.

Why did the Sudbury workers choose the Teamsters? Shawna:

“[Because] they are one of the biggest [and] the best, and we feel that we are worth the best”

“The workers wanted to show Value Village they were not going to take their crap anymore, and management was scared when they heard the teamsters were coming in,” she said, adding

“I'm happy to pay my $10 monthly union dues. At least then we know that we will be treated like human beings, not [like] some slaves brought in from a foreign country,” she said energetically and concluded, “Value Village can fight us all they want but we won’t back down, we have the union and we are going to keep it!”

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