Labor Negotiations at IKEA

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LABOR NEGOTIATION AT IKEA Unionizing Issues and Low Wages at IKEA in the United States IKEA is a leading furniture manufacturer in the world. It has been able to achieve its success because of a unique competitive model that emphasizes simplicity in design and low costs. Based in Sweden, the company has established manufacturing facilities overseas, with its first manufacturing facility opened in Danville, Virginia in the United States in 2008. Just three years later, in 2011, newspapers reported huge dissatisfaction among IKEA workers in the region over multiple issues ranging from management's resistance to unionization, mandatory overtime, and low wage rates, to racism and strict working conditions. Management at the facility held meetings with workers to persuade them not to form a union. After criticism from the home country Sweden and the intervention of the International Association of Machinists and Aerospace Workers, workers were able to form a union in July 2011 through a majority vote of 221-69 (New York Times). Suffering from similar problems such as erratic scheduling and the absence of seniority systems, workers at a second IKE A factory at Perryville, Maryland also voted 183-119 to form a labor union (Jamieson, 2012). The management appears to have learnt from the popular widespread criticism of its attempts at preventing unionization efforts. The management has adopted a moderately positive stance to the second successful unionization at the company.
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