Teamsters Seek Probe of Costco Signature Campaign

SAN FRANCISCO - California's attorney general is considering a labor union's request to look into Costco Wholesale Corp.'s efforts to put a measure to a statewide vote that would overhaul workers' compensation rules, Reuters reports.

"We're evaluating the request," said Tom Dresslar, spokesman for Attorney General Bill Lockyer, on Tuesday.

The day before, the International Brotherhood of Teamsters sent a letter to Lockyer accusing Costco of requiring employees to engage in political activity on the company's behalf.

Costco, a warehouse-type discount grocer and retailer based in Issaquah, Wash., is backing a measure that would dramatically alter the state's workers' compensation insurance system by making it harder to collect claims.

Long frustrated by rising workers' compensation insurance expenses, Costco last week ordered 90,000 petitions to be circulated by workers at its markets in California. The company in theory could gather as many as 900,000 signatures.

The initiative campaign, which has Gov. Arnold Schwarzenegger's support, needs 598,000 valid voters' signatures by April 16 to place the measure on the November ballot.

Workers' comp expenses are more than twice as high for California employers as the national average, and Schwarzenegger wants to slash $11 billion from the $29 billion insurance system either with help from lawmakers or through a statewide vote.

The Teamsters' letter to Lockyer claims Costco is violating a section of California's labor code barring employers from directing political activities of employees.

"Things like this are better left out of the employment arena," said Chuck Mack, the Teamsters' western region v.p., who sent the letter.

The union considers Costco a good employer but is concerned its members who work for the company in California, between 10,000 and 12,000, depending on the time of year, may be coerced into gathering signatures for the initiative, Mack said.

Joel Benoliel, Costco's chief legal officer, said the company isn't requiring employees to gather signatures. "There is no coercion," he said. "There is absolutely no consequence if someone says, 'I'm not comfortable manning that table.'"

The Teamsters' letter surprised Costco, which has friendly relations with the union, said Benoliel.

He noted Costco and the Teamsters quietly renegotiated a compensation contract covering the company's California markets. This contrasts with the turmoil of the recently concluded labor dispute in Southern California involving the United Food and Commercial Workers Union and supermarket chains Kroger Co.; Albertsons, Inc.; and Safeway, Inc.

Dresslar said there is no deadline for acting on the Teamsters' letter.