Costco employees are gearing up for potential strike action amid serious negotiations over wages, benefits, and workplace conditions, as tensions rise over the company’s diversity, equity, and inclusion (DEI) policies. With more than 18,000 Costco workers represented by the Teamsters union, many are threatening to walk out if their demands are not met by the January 31, 2025, deadline.
This current unrest has culminated from what union leaders describe as Costco’s aggressive and anti-union negotiation tactics. The Teamsters have accused the retailer of rejecting nearly all of their proposals, claiming Costco has declined 98% of offers made. They are pushing for various enhancements, including improved paid family leave, stronger seniority rights, increased sick time, and protections against workplace surveillance.
“We are seeking what is rightfully ours as employees of this company,” said Sean O'Brien, General President of the Teamsters, who has been vocal about the need for Costco to share its financial success more equitably with its workers. Given Costco’s reported $7.4 billion profit last year and revenue rising to nearly $250 billion, the workers expect the company to respond to their needs.
Costco’s CEO, Ron Vachris, defended the company's position, stating, “We have a 40-year track record of dealing fairly with the Teamsters union.” He also refrained from commenting on specifics related to the negotiations. Interestingly, the company has recently faced political scrutiny for its DEI initiatives. On one hand, these policies have garnered praise within human resources circles for promoting inclusion, yet they are now facing rising opposition, particularly from conservative factions.
Much of the pressure on Costco stems from 19 Republican attorneys general, who have jointly demanded the retailer to scrap what they term “illegal” DEI practices. This letter, which gives Costco just 30 days to respond, follows the signing of President Trump's executive order, which targets DEI initiatives within the federal sphere and encourages private sector firms to adopt similar stances. Iowa Attorney General Brenna Bird, who spearheaded efforts against Costco, stated, “Costco needs to show us the proof they are following the law because they have public statements which cause us great concern.”
Support for Costco has also emerged; Washington state Attorney General Nick Brown publicly voiced his commitment to defending the retailer against the aggressive stance taken by his Republican counterparts. He expressed disappointment over such tactics, saying, “We don’t believe in punishing private companies for making decisions to protect and promote their workforce.”
The stakes couldn't be higher as the situation develops. If the workers proceed with their strike—even just as practice pickets have been staged at key Costco locations like Hayward, California; Sumner, Washington; and Long Island, New York—it could disrupt operations across the company’s 600-plus outlets nationwide. This potential threat to supply chains is particularly significant as the retail giant navigates increased scrutiny over its DEI practices.
Interestingly, Costco’s board chair, Hamilton "Tony" E. James, voiced strong support for maintaining DEI values within the company, asserting, “We owe our success to the more than 300,000 employees who serve our members every day. It is important these workers all feel included and appreciated.” This sentiment indicates Costco’s commitment to its inclusion strategies, irrespective of the external political pressures mounting against them.
Nonetheless, the Teamsters union seems determined to hold the company accountable, arguing Costco must demonstrate a willingness to negotiate fairly. The workers are fast mobilizing, largely encouraged by recent union successes, including strikes at other major retailers like Amazon.
“Workers are the backbone of this company. It’s time for Costco to acknowledge this with a fair contract,” O'Brien remarked, emphasizing the fundamental role employees play in the organization’s everyday operations.
The impending deadline looms large, and as January 31 approaches, both sides remain firm. Will Costco yield to the Union's demands? Or will they continue to stand by their current policies both on labor negotiations and DEI, potentially uniting worker resolve even more against them? The outcome remains to be seen.