Labor

How Google and Silicon Valley Screw Their Non-Elite Workers

Silicon Valley’s biggest firms outsource blue-collar and service jobs to subcontractors, who bid low by scrimping on labor standards.

Photo Credit: Flickr (cc)

Silicon Valley sparks the imagination. Its wealth of tech jobs, flashy startups and new media goliaths seems to point toward a better future, beyond post-industrial doldrums and slack labor markets. Work on Google’s idyllic Mountain View campus hardly looks like work at all.  

But some Google employees are less equal than others. (Not everyone gets to ride the clown bikes.) Many of Silicon Valley’s blue-collar jobs are outsourced to subcontractors, a practice common with Google, Apple, Hewlett-Packard, and other big tech firms. Usually the lowest bidder gets the contract, and in labor intensive industries such as security, food service, janitorial and landscaping the lower bids tend to come from firms with lower labor standards.

Security Industry Specialists, Inc (SIS) provides hundreds of security contractors to both Google and Apple. (SIS did not respond to interview requests or questions about the exact number of guards the two companies employ.) Tom Seltz, co-president of SIS, claims that the company offers $15 an hour for entry level employees, plus benefits for full-time workers: “We pay 80 percent of the healthcare premium, 100 percent of dental, and these employees have access to a 401k plan in which we match a portion of contributions.”

But according to SIS employees, everyone starts as part-time and must work their way to a full-time position. Part-timers have no health or retirement benefits, no paid sick leave and no vacation. The hours are unpredictable because the company calls them about a day in advance to dispense shifts. Turnover at SIS is high, partly due to draconian disciplinary measures that make it difficult to advance to a full-time position. The Service Employees International Union (SEIU), which is trying to organize the guards, estimates that only 20 percent of SIS’s employees are full-time.

“Supervisors—they didn’t treat us like people,” says Manny Cardenas, the only guard to publicly endorse the unionization drive. “We got fired for small things. Zero tolerance. One guard, he told a janitor what time it was and because he used his cell phone to check the time he was fired.” 

Cardenas reports that none of his peers have joined the cause. “My co-workers keep changing [referring to high turnover],” says Cardenas, who spoke at a pro-union rally outside the Google shareholders’ meeting on Thursday, June 6. “And they know that they’ll be fired, if they are getting fired for little things like cell phone to tell the time—they know something might happen.”

What that something is seems pretty clear. Since going public with his support for a union in January, Cardenas has only received one call for a shift. He hasn’t officially been fired by SIS, but the result is pretty much the same. (A charge that SIS illegally interfered in the organization drive by spying on worker meetings “may have merit,” according to William Baudler, regional director of the National Labor Relations Board, who dismissed the complaint “because the conduct at issue here is isolated.”)

The union attempting to organize Silicon Valley’s approximately 3,000 guards is SEIU-USWW (United Service Workers West), which represents the janitorial staff in many of the same buildings. The rally outside the shareholders’ meeting attracted between 40 and 50 people, including two San Jose councilmembers. Community groups addressed Google in an open letter released on the same day: “We urge you to find a more responsible security contractor, a company whose workers can have full-time hours, decent benefits and the fundamental freedom to form a union—without management interference.”

“The leaders in the market are Apple and Google and where they go, the others follow,” says Renee Asher, spokesperson for SEIU. “We want Apple and Google to sit down with us, we want to partner with them, as they have partnered with us in the past about income inequality, the rise of part-time jobs, and the number of good jobs being replaced with bad ones."

So far Google has made no public statement regarding the unionization drive and did not respond to interview requests for this article.

SEIU does have a history of targeting publicity-sensitive tech firms, especially those that put forward a progressive public image (e.g. Google’s “Don’t be evil”). The tactic has a history of success in Silicon Valley, producing victories in the Justice for Janitors campaigns of the 1990s and in subsequent rounds of contract negotiations, most recently in 2008 and 2012, although they usually try to distance themselves from the conflict. This statement from Dave Miller, a spokesman for Allied materials during the 2008 contract negotiations between the janitors and the cleaning companies, is typical: "We don't have a comment on it. Ultimately, it's between (the union) and the employer contractors that work for us.” But often the big tech firms eventually pressure their sub-contractors to reach a settlement. It is unclear if they will intercede on behalf of their security guards or if the union drive will succeed without their involvement.

According to Asher, the unionized janitors aren’t paid substantially more than their security guard counterparts. Indeed, in 2012 one of the points of contention was the janitors’ $28,000-a-year salary after almost 20 years of unionization, according to Dave Jamieson of the Huffington Post. But the bonuses janitors do get are stable, full-time jobs, dependable schedules, pensions, paid sick leave, vacation time and a healthcare plan with no deductible and small co-pays. They are not “at-will” employees—managers can’t fire them for just any reason—and their turnover rates aren’t so high.

Still it seems as though more should be possible, especially against the background of Silicon Valley’s immense wealth and the supposed progressive vision so many of the region’s moguls profess. But as George Packer’s recent New Yorker profile of the region attests, the tech elites seem to believe that they are doing good just by doing business. “I think our selfish interest actually aligns with the broader interest of creating jobs and growing the economy,” Joe Green, one of Mark Zuckerberg’s Harvard classmates and associates, told Packer. The article presents Green as unusually politically aware among his peers. He doesn’t elaborate on what kinds of jobs are being created. 

“The image is that Silicon Valley’s streets are paved with gold—the quality of life is extraordinarily rich,” says Bob Brownstein, director of policy and research for the labor-backed and San Jose-based Working Partnerships USA. “But the economy here is, at best, an hourglass economy. There are some extremely well-paid jobs at the top, a rapidly shrinking middle-class, and a large number of low-wage, dead-end, no-benefit service jobs. It’s not really an hourglass because the bottom is the part that’s growing fastest.”

A pair of recent reports indicate that Silicon Valley’s economy isn’t that much different from the rest of America's. Working Partnerships USA’s “Life in the Valley, 2012” report shows while corporate profits have rebounded, jobs and wages have not. Between 2000 and 2010 100,000 manufacturing jobs disappeared and real median household income plummeted by 19 percent. While earnings increased per capita, the windfall largely went to a relatively small portion of the population, while the portion of families who were middle-income (those making between $50,000 and $199,999) fell from 62 percent of households to 55 percent.

The 2012 Silicon Valley Index shows many of the same results, although it is published by Joint Venture Silicon Valley, a collaborative that includes many of the region’s elites (Google’s Larry Alder sits on the board of directors). “Though the recovery is underway, income growth is mostly limited to high earners, and is not spread across other segments of the population,” reads the report, which also finds a decline in manufacturing jobs and middle-income households.

“There are a lot of other places in the United States that view Silicon Valley as a goal—they want to attract these kind of industries,” Brownstein says. “The important thing for those people to understand is that there are benefits associated with that but it does not solve all problems. It still produces an economy characterized by great and growing inequality and a substantial part of the workforce unable to earn enough to have a decent standard of living. We haven’t seen anything to suggest there is anything in the Silicon Valley model itself that mitigates these problems.”

Jake Blumgart is a freelance reporter and editor based in Philadelphia. Follow him on Twitter at @jblumgart.

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