Special for the Armenian Weekly
Manchester, N.H. (A.W.)—As the conflict between Market Basket’s employees and Board of Directors surrounding the firing of CEO Arthur T. Demoulas enters its third month, the Armenian Weekly sought an inside perspective on the standoff that has made the news as far away as New Zealand. Peter Gulezian, the store director of Market Basket’s Manchester location, has been with the company since August of 1983 when he began as a part-time employee. Gulezian went on to work his way up through various positions in the organization in a number of the company’s 71 locations and has been a store director for the last 16 years.
Like the majority of Market Basket employees, he supports ousted CEO Arthur T. Demoulas. “Arthur Demoulas has always had simple values—keep the stores neat, clean, and simple, give the customer the product that they’re looking for, keep the prices as low as possible, and provide them top-notch service. And because of that, it’s been a winning success…what he’s done by simple philosophies is remarkable.”
The standoff began when the Board of Directors moved to fire Demoulas in late June, following a shift in voting power to Arthur T. Demoulas’ cousin and rival, Arthur S. Demoulas. Beginning the next day workers protested the firing, which marked the first time in the Market Basket’s history that the company has come under outside leadership. “There’s never been a person hired outside of this company to be appointed into a position, especially something of that caliber. Every single person has started at the bottom and worked his or her way up, learning the trade, learning the business, learning each step of the way. And that’s what’s made us so successful,” said Gulezian.
What we all want is for Arthur T. Demoulas to come back and run this company the way he always has.
Gulezian credits the unique loyalty of Market Basket employees to the culture that Arthur T. Demoulas instilled. With robust benefits and a hands-on style, Demoulas retained happy employees proud of the company they worked for. “[Arthur T. has] done nothing but reward us—not just me, us—meaning all the employees for all their hard work with a great pay program, great profit-sharing program, bonuses, excellent healthcare benefits, and you know that all came to a screeching halt the day that he was terminated.”
That atmosphere morphed dramatically with the introduction of two new CEOs, Felicia Thornton and James Gooch. According to Gulezian, the effects on the business have been immediate and devastating. “The people that they brought in to take over and run this company have been noted for taking companies and running them into the ground. They got two new CEOs to run this company and we’re all in desperate fear that that’s exactly what…is going to happen to this company.” The losses to the business so far this summer have been massive. “Our stores right now are losing about an average of $10 million a day in volume, so we’re losing about $70 million a week.”
Gulezian is also alarmed by the lack of direction from the new leadership. “They’ve never been into, I’d say, 98 percent of the stores, they haven’t shown their faces, they haven’t reassured us. We’re in the middle of a traumatic crisis here, where are they? We’ve received no direction, not even coming in to talk to us or giving us direction as to what to do. All we keep doing is getting threatened that we’re going to lose our jobs.”
Meanwhile, the business is paralyzed. Gulezian estimates that he has at least 25 orders currently in limbo. “This past Tuesday, the 29th, I received a truck that was dated for delivery on the 23rd, which means I ordered it on the 21st. So we placed an order on Monday the 21st to be delivered on Wednesday the 23rd, and that product showed up on Tuesday the 29th. You can’t run a business like that.”
The damage to the business has even extended beyond Market Basket itself. “A lot of what isn’t really getting reported too is how bad all of our vendors are getting affected. They’ve had to shut down aspects of their business and lay people off—it’s already instantly affected them to this point, they’ve had to lay off summer help and…they’ve had to take discounts to try to peddle their products to other places, or they’ll get middlemen to help sell the stuff that they have. We have a lot of vendors that just exclusively deal with us, and now all of a sudden they’re in trouble…these people have come to a complete standstill.”
Gulezian describes a stark difference between the leadership styles of Arthur T. Demoulas and his cousin, Arthur S. Demoulas. “He (Arthur S.) is a family owner and member of the business, but no one’s ever seen him in the stores and working. He doesn’t come around and show his face, he’s not hands-on like Arthur T. was. He could walk into this building and people wouldn’t even know who he is. But if Arthur T. Demoulas is to walk into this building, everybody would know who the guy is because he’s been in here several times, working with his employees and meeting them, and talking to the customers…he’s just a very hands-on owner of a supermarket company. Arthur S., he’s never done that.”
A salient feature of the Market Basket conflict has been the strident support of customers and public figures for the employees and Arthur T. Demoulas. Numerous lawmakers have publicly supported the boycott, and the attorneys general of Massachusetts and New Hampshire wrote a joint letter to the new management at the end of July preemptively advising them of the labor laws in their respective states, amid fears that sizable portions of the Market Basket workforce may be laid off.
After the new management failed to heed worker demands to have Arthur T. Demoulas reinstated, approximately 2,500 employees went on strike and rallied on July 18. Eight management level employees were fired by courier on July 20 due to their roles in organizing protests. The firings drew an estimated 5,000 protesters to the Tewksbury, Mass. store and later that day Arthur T. Demoulas called for the fired managers to be reinstated. Meanwhile, the boycott began to take effect in earnest, as sales dropped by over 70 percent.
When the fired managers were not reinstated, Arthur T. Demoulas publicly announced his offer to purchase the company’s remaining shares from his cousin, Arthur S. Demoulas. Protesters rallied again at the Tewksbury store in their largest protest to date, with crowds estimated at between 6,000 to 15,000 strong. The Board acknowledged the buyout offer but did not announce any decision.
On July 30, the new CEOs issued a demand that workers return to work by Monday, August 4. In anticipation of many workers refusing, the CEOs have announced an internal job fair on Monday, August 4, which is planned to open to the public by Wednesday, August 6. The job fairs are a particularly contentious matter, given that many of the jobs being advertised are still occupied by workers who have not left their posts. “None of the work people in the stores have walked off their jobs. Yet they chose to threaten us,” Gulezian said.
In addition to the ethical questions raised by this move, there are practical ones as well. “Now who’s supposed to be training these people? Who’s supposed to be doing the interviews? We have no idea. You can’t just walk into a job of this caliber without having any prior knowledge of what’s going on.” Indeed, the state of affairs under Market Basket’s new CEOs appears as striking proof of this observation.
As the standoff continues, Gulezian warns that the coming week will likely bring the hardest-hitting phase of the boycott thus far. “This coming week that we’re going into will be even worse because it’s the first of the month, so we’ll probably be losing $12 to $13 million a day.”
Ultimately, all Gulezian and the rest of the workers want is a return to the business as they knew it for decades. “What we all want is for Arthur T. Demoulas to come back and run this company the way he always has. We’ll get back on our feet in no time, get the customers back in here shopping, and they’re in more support of this than you can imagine…Once that man does come back, this company is going to explode, it’s going to take off and go right back to where it used to be without missing a beat…We are just a little New England company with 71 stores, and yet we’re on the verge of making history.”
Acknowledgements to the Boston Globe for a comprehensive chronology of the conflict, available here.