Blogs & Comment

Target: Is a store a person?

Target is taking over Zellers stores. What does it owe to Zellers' employees?

(Photo: Vito Amati/Target)

Contrary to what many claim to believe, the union representing workers at Zellers stores in Calgary, Alberta, believe that corporations (or businesses more generally) are in fact persons, morally and legally. At least, that’s what seems to be implied by the position they are taking.

Here’s the background, for those who don’t already know. Zellers is Canada’s second-largest chain of discount stores and has been acquired by American chain, Target. Over the next couple of years, 189 Zellers locations will be replaced by Target signs and merchandise.

What about the employees? Not surprisingly, they will be laid off by Zellers. Target says it will welcome applications from the former Zellers employees, but with no guarantee, for example, that their years of service for Zellers will count for anything. They will be brand new employees, as far as Target is concerned.

But wait, says the union representing those employees. You mean that a worker with 20 years experience could conceivably leave Zellers one day, return (to the same building) the next morning to her new job at Target, and find she’s being paid like she’s got zero experience? So much for being loyal to loyal employees!

But notice what this line of reasoning assumes. It assumes that a store—indeed, a physical location—is something that can have responsibilities. The sign can change; the merchandise can change; even the ownership can change. But the store where you’ve worked the last 20 years is still, on some level, the same store. Or so the theory goes.

And the theory is not without some basis in law. In at least some jurisdictions, union representation, for example, carries over to the new owners when a business is sold. You can’t sell your business and thereby simply void the contract with the union representing your employees. (You can imagine the alternative: two brothers could “sell” their company back and forth to each other every six months just to neuter the union. It’s probably in the public interest to keep that loophole closed.)

However, the present case isn’t quite like that. Target isn’t buying the Zellers stores lock, stock, and barrel. It’s simply taking over the buildings. So the transfer is unlikely to fall under the principle that a pre-existing collective agreement “goes with the business.” So for the union to assert that Target has responsibilities to the employees-formerly-known-as-Zellers-employees requires an especially strong version of the corporate “personhood” thesis, according to which corporations are to be treated as individual entities, under the law, for purposes of contracting, land ownership, and so on.

I doubt the union’s argument here can be made to hold water, though I would be interested to hear if readers think differently.

Chris MacDonald is Director of the Jim Pattison Ethical Leadership Education & Research Program at the Ted Rogers School of Management.

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