LAND OF THE OPEN SHOP: The Long Struggle to Organize Silicon Valley

On January 29, 1993 workers at the Versatronex plant in Sunnyvale, California filed out of its doors, one last time, before the plant was closed. “We said at the beginning that if the company was going to shut down, let them,” said Sandra Gomez, a Versatronex striker. “But as long as the plant was open, we were going to fight for our rights.”

Versatronex was the first Silicon Valley plant struck by production employees, and these were the first Silicon Valley strikers to win recognition for their union. Their struggle demolished some of the most cherished myths about the high-tech workforce, and showed that Silicon Valley workers—like workers anywhere under the right circumstances—are willing to fight to end sweatshop conditions.

Corporations like IBM, Hewlett-Packard, Intel, and National Semiconductor told their workers for years that healthy bottom lines would guarantee rising living standards and secure jobs. Economists called the electronics industry a massive, growth-fueling industrial engine, benefiting workers and communities alike. No unions were needed.

Those promises were worthless. Today, many giants of the industry own no factories at all. Contract manufacturers build computers and make chips in locations from China to Hungary. In the valley’s remaining factories, labor contractors like Manpower have become the formal employers, relieving the big brands of any responsibility for the workers who make the products bearing their labels.

Living standards continue to rise for a privileged elite at the top of the workforce, but they’ve fallen on the production line. Tens of thousands of workers were dropped off the line entirely as manufacturing left the valley. Permanent jobs became temporary, and then disappeared altogether. Instead of representing a clean industry with no layoffs, Silicon Valley found itself saddled with toxic contamination of its water supply, chemically-induced industrial illnesses, and extreme insecurity in its workingclass neighborhoods.

Despite these obstacles, for three decades the valley was also a cauldron of workplace organizing to oppose inhumane conditions. Some workers, like the janitors, experienced remarkable success. Others, however—especially production workers in the plants themselves—found a harder road. The labor movement often seemed to accept the industry’s mythology that electronics workers can’t, or won’t, organize.

Sandra Gomez’s determination showed just how wrong that idea is. Instead, those decades of activity should give unions hope that the “unorganizable industry” can be defeated, and ideas for tactics that can accomplish that goal.

The First Effort— Organizing Semiconductor Workers

In the early 1970s, workers began to form organizing committees—affiliated with the UE (the United Electrical, Radio, and Machine Workers union)—at National Semiconductor, Siltec, Fairchild, Siliconix, Semi-Metals, and other semiconductor manufacturing plants (or factories that supplied raw materials to them). Amy Newell helped start a rank-and-file organizing committee at Siliconix. Two decades later she became the UE’s national secretary-treasurer, the highest-ranking female union officer in the U.S. at the time. She recalls concentrating on the larger plants because “the capital investment was so large there. They were the big players, and we wanted to go for the heart. Nevertheless, it was very hard organizing a union in those plants, because the feeling of powerlessness among the workers was so difficult to overcome.” Newell says organizing high-tech workers requires “a long-term commitment, with an industry-wide approach. It’s hard to imagine organizing any plant without a much larger movement in the industry as a whole, and in the communities in which the workers live.” By the early 1980s, the UE Electronics Organizing Committee had a core membership of more than five hundred workers who participated in a number of campaigns.

For years, there was no union staff person in Silicon Valley. At the height of its activity, a single organizer—Michael Eisenscher—was the committee’s link to the national union, running the union mimeograph machine from his garage. The committee’s strategy envisioned a prolonged struggle, with members fighting the companies over wages, working conditions, discrimination, and job security. In-plant guerilla campaigns, using leaflets and stickers, resulted in cost-of-living raises.

The UE Electronics Organizing Committee was a nexus of activity from which other organizations developed. The Santa Clara Committee on Occupational Safety and Health (SCCOSH) was founded by early UE activists who left the plants. It built broad ties with other unions, occupational health and safety experts, and community leaders. It successfully fought to end the use of carcinogenic chemicals like trichloroethylene, and for the earliest right to know legislation. SCCOSH started an Injured Workers Group for workers suffering from chemically-induced industrial illnesses.

The Silicon Valley Toxics Coalition also grew out of health and safety campaigns that ripped away the image of the “clean industry,” and won national recognition for exposing electronics manufacturers’ large-scale contamination of the water table. Its activists organized the communities around the plants, and forced the Environmental Protection Agency to add a number of sites to the Superfund cleanup list.

The UE committee’s last campaign—in 1982—tried to mobilize opposition to moving production out of Silicon Valley, and to stop the firing of its own members. In 1983, the plants still employed 102,200 workers; but that number fell to 73,700 ten years later. Employment of engineers and managers slightly increased, while operators’ and technicians’ jobs were eliminated. “Filipino workers lost their jobs by the thousands, more than any other national group,” says Romie Manan, who got laid off when National Semiconductor closed its last mass production wafer fabrication line in the valley in 1994.

A wafer fabrication line, the basic unit of the semiconductor production process, has a useful life of about ten years. Because technology evolves so rapidly, semiconductor companies must build new plants and new “fabs” constantly. For workers, their location is a life-and-death question. In 1993, for example, Intel built a new $1 billion plant in Rio Rancho, New Mexico instead of California. According to Howard High, Intel’s public relations spokesperson, New Mexico offered Intel a billion-dollar industrial revenue to finance the plant’s construction. California couldn’t match the subsidy.

Manan believes lower wages were another factor. “Wages [in New Mexico] are much lower,” he says. “New workers earn around $6-7/hour. Those of us with many years in the plants here earn more. That’s why National and other companies wouldn’t allow Silicon Valley workers to transfer to the other plants.”

Electronics giants initiated bidding wars, in which communities around the country— and eventually around the globe—compete by promising cost savings, relaxation of regulations, and direct tax subsidies. In Silicon Valley, that competition created a two-tier workforce. The permanent jobs in the large manufacturing plants started disappearing. But contractors who provide services to the large companies, from janitorial and food services to the assembly of circuit boards, employ more workers every year.

The union also faced the gradual reduction of the workforce itself and, eventually, the conversion of direct employment to employment by temp agencies. The UE committee’s response was to rally community support for workers whose jobs were being relocated, and against the racist wave of firings that accompanied the downsizing. It protested anti-union firings as one aspect of this broader attack. Hearings against the firings and plant relocations were organized by the county’s Human Relations Commission, a tactic later developed by Jobs with Justice’s Workers’ Rights Boards. In the end, however, the committee gradually dispersed as members sought work wherever they could find it.

The experience certainly proved that workers were willing to fight, often at enormous risk, and could make some gains. For several years, worker pressure forced companies to improve wages and discontinue the use of some toxic chemicals. A network of organizations in the community supported workers’ efforts. The UE committee’s long-term strategy, focused on building the union on the plant floor by challenging the company on basic conditions, sought to build on that willingness. But the resources of rank-and-file workers, even when assisted by a relatively small (albeit radical and committed) union, were not enough to stop the firings and job losses, or move toward a battle for union recognition. A long-term, and much larger-scale, commitment of the labor movement is the most basic requirement for evening those odds.

The New Wave— Organizing the Contractors

Ten years after the earlier peak in organizing activity, workers in Silicon Valley’s service and sweatshop sector launched a wave of actions, like those previously fought, to raise wages in the semiconductor plants. By the early 1990s, workers who had lost their jobs on wafer fabrication lines were making as much as $11-14/hour as operators, and technicians were making even more. Companies provided medical insurance, sick leave, vacation time, and other benefits. Some of these benefits resulted from the paternalistic policies intended to keep unions out, but other gains are a testament to the pressure that had been exerted during the semiconductor campaigns.

However, a growing number of contract assemblers and nonunion janitors were paid close to the minimum wage, and had no medical insurance or other benefits. That second tier of living standards is what made the service and sweatshop economy a target for organizing.

This second wave began with the campaign to organize janitors at the Shine Maintenance Company, a contractor hired by the Apple Computer Corporation to clean its huge Cupertino, California headquarters. Over 130 janitors joined the SEIU’s Local 1877 in the fall of 1990. When Shine learned that its workers had organized, employees were suddenly told they had to present verification of their legal residence in order to keep their jobs. (The company cited the employer sanctions provision of the Immigration Reform and Control Act’s requirement to maintain written proof of employees’ legal status.) When almost none of Shine’s workers could present the required documents, they were terminated.

After the firings, the union called a meeting of activists, along with church and political figures, in San Jose (which has a large Latino community). “We told them that we had taken our struggle as far as we could—that the labor movement is limited because the law hurts workers who want to organize more than it helps them,” explained Mike Garcia, president of Local 1877. “So a community coalition went to picket when our union couldn’t, supported the workers with a hunger strike, and started a boycott of Apple products.” A year-long campaign won a contract for Apple janitors in 1992, and that community effort grew into the Cleaning Up Silicon Valley Coalition.

Using the same strategy, the union won contracts for janitors at Hewlett-Packard, an even larger group. The momentum created in those campaigns convinced other nonunion janitorial contractors to actively seek agreements with Local 1877, and over fifteen hundred new members streamed into the union.

In September of 1992, janitors were joined by electronics assembly workers at Versatronex, who used a similar strategy to organize against the sweatshop conditions in contract assembly factories. The starting wage at the plant was $4.25 (the minimum wage at the time) and employees of more than fifteen years earned as little as $7.25—with no medical insurance.

Contract assembly greatly benefits corporations like IBM. Contractors compete to win orders by cutting their prices, and workers’ wages, to the lowest level possible. Corporations place new orders on a moment’s notice when production demands increase; and when needs decrease, they simply cut orders—workers lose jobs and the manufacturer owes them nothing.

Versatronex workers were preparing to stop work to demand changes—and when the company heard rumors about this, its managers held a meeting to head off the action. One worker, Joselito Muñoz, stood up and declared (to company supervisors): “Se acabo el tiempo de la esclavitud!” or “The time of slavery is over!” He was fired two days later. The following month, Versatronex workers—after bringing in the UE—went on strike to win Muñoz’s job back.

In the course of their strike, workers focused on one particularly large customer— the Digital Microwave Corporation (DMC)— whose boards were assembled at Versatronex. The year before the strike, DMC closed its own manufacturing facility and became one of Versatronex’s main customers. At the high point of the six-week strike, ten women began a hunger strike outside of DMC’s gleaming office headquarters. “DMC sends work to Versatronex, and then closes its eyes to the conditions we work in,” explained hunger striker Margarita Aguilera, who’d been a student activist in Mexico. Male strikers set up tents on the sidewalk outside the company’s main entrance, and lived there around the clock. Word of their action spread through the valley’s (very supportive) Mexican immigrant community.

Workers ended their strike in November 1992, and immediately filed a petition for a representation election. Versatronex closed its plant the following January.

As workers at Versatronex were striking, Korean immigrants at USM, Inc.—another contract assembly factory—began a similar fight. When USM closed its factory, still owing workers two weeks pay, the jilted employees turned to the Korean Resource Center. Together, they organized demonstrations in downtown San Jose against Silicon Valley Bank, which took over the assets of the closed factory and refused to pay the workers.

Tactics used at Apple, USM, and Versatronex were at the cutting edge of the labor movement’s search for new ways to organize in the 1990s. They relied on close alliances between workers, unions, and community groups to offset the power exercised by employers—much as the semiconductor workers had tried to do a decade earlier. Often, though not always, they used direct action by workers themselves to short-circuit the lengthy propaganda wars that companies often use to win National Labor Relations Board (NLRB) elections.

At the movement’s peak, janitors united with workers from Versatronex and USM in a march through downtown San Jose, demanding an end to exploitive conditions for immigrants. Grassroots tactics gave these struggles of low-wage workers the character of a social movement, and helped them learn organizing methods they later used to deal with issues of immigration, discrimination in the schools, police misconduct, and other aspects of daily life in immigrant communities. Subsequent marches against anti-immigrant laws, and even today’s protests against police brutality in San Jose, have roots in those schools where workers had been trained to organize.

Nevertheless, janitors were able to win union recognition, while contract assembly workers were not. That reflects the different attitudes the giant corporations have toward unions in the companies that provide support services to the industry, versus workers who try to organize the production line itself. For instance, over the years, electronics manufacturers were forced to use outside contractors (who had union agreements) for construction work. Since the local building trades are so well unionized, especially contractors with the high skill levels needed for in-plant construction, Silicon Valley companies were left with little alternative. Once the SEIU successfully organized most building service contractors, that industry faced a similar situation, and janitorial jobs were given to union members.

From the beginning, however, the electronics industry drew a line between outside services and the basic production process. At the production stage, whether the work was performed by the companies’ direct employees or by assembly contractors, unions weren’t allowed. In order to successfully challenge that prohibition, workers, communities, and unions would need to ramp up their levels of commitment and unity. As Newell suggested, this requires combined organizing efforts, whereby unions organize many contractors at the same time, limiting the ability of employers to cut off a single contractor like Versatronex.

The Companies Fight Back and Press for Political Change

In 1993, as a counter-protest, the high-tech industry announced plans to impose its blueprint—called Joint Venture: Silicon Valley—for economic development in Silicon Valley. A coalition of more than one hundred industry and government executives pitched initiatives for regulatory relaxation, educational programs, and resources for research and development. Ernestina Garcia, a longtime Chicano community activist in San Jose, explained that “we’ve never felt that the electronics industry had the interests of our communities at heart. If they plan the future of the valley, they’re going to do it for their benefit, not ours.”

The subsequent Campaign for Justice was the labor-community response to the industry’s plan. Instead of concentrating on a single contractor, it initially set its sights on the whole low-wage contract workforce. John Barton, the campaign’s SEIU-based coordinator, promised “strong and militant action in the workplace, combined with effective corporate campaigns. We’re going to hold manufacturers responsible for their contractors.”

Four separate international unions—the janitors, Teamsters, hotel and restaurant workers, and clothing workers—formed a strategy committee and contributed researchers and organizers to a common pool. Two community representatives also sat on the committee, but the campaign’s dependence on union staff proved its undoing.

The pressure for immediate results quickly led unions, other than the janitors, to pull out. Without their support, Local 1877 pushed forward with a drive aimed at landscape gardeners in the valley’s industrial parks. The campaign won the support of many workers, some of whom were fired. They marched through the streets, and pressured contractors and their corporate clients. Eventually, however, the campaign disappeared into the effort to renew union contracts for the janitors.

However, in 1994, the community-labor partnership was strong enough to become the basis of a statewide campaign against the antiimmigrant Proposition 187. These campaigns had other important political results. At the initiative of the janitors, the SEIU called for a repeal of employer sanctions, as did the garment unions and the state labor federation. Six years later, a network of immigrant rights activists in the labor movement led a successful effort to get the AFL-CIO to echo this call for the sanctions’ repeal—which turned out to be a key step in changing labor’s relationship with immigrant workers.

In 1992, at the beginning of the Clinton administration, high-tech companies began to press for changes in labor law to bring it into line with “new realities.” Unions and workers wanted changes that would help curb the proliferation of contracted and temporary work.

The Clinton administration set up the Commission on the Future of LaborManagement Relations, also known as the Dunlop Commission, to review labor law reform. Its mandate, rather than reinforcing union rights, was “to make recommendations concerning what changes, if any, are needed to improve productivity through increased worker-management cooperation and employee participation.”

The Dunlop Commission’s key hearing in Silicon Valley was convened by the Joint Venture: Silicon Valley group. Valley firms had the ear of the Clinton administration, after having been wooed for contributions to his election campaign. Clinton’s chair of the Joint Council of Economic Advisors was Laura D’Andrea Tyson, a UC-Berkeley professor with strong ties to the electronics industry.

The program pushed by corporate executives in Silicon Valley proposed a new public policy for labor-management relations. Under the klieg lights in San Jose’s cavernous convention center, they introduced the “high performance workplace,” featuring work teams, labor-management cooperation, and “corporate culture and values.” Doug Henton, representing Joint Venture, announced: “Unions as they have existed in the past are no longer relevant. Labor law of forty years ago is not appropriate to twentieth-century economics.”

Romie Manan, just months away from being laid off, again challenged the industry he’d battled for almost two decades. “The company always told us that [it] had to be competitive,” he said:

Increasing the company’s profitability, they said, would increase our job security. That was the purpose of our work teams—to make us efficient and productive. So we became more efficient. Then the company took the ideas contributed by the experienced workforce in Santa Clara, which they got through the team meetings, and used them to organize new fabs with inexperienced workers in Arlington, Texas, where wages are much lower. The experienced workers lost their jobs. The team meetings stole our experience and ideas, and didn’t give us any power to protect our jobs and families. The company chewed us up and spit us out.

At National Semiconductor, according to Manan, workers were told they had to team up with management in order to defeat the Japanese competition. Fear for their jobs, he said, drove workers to join the teams, which were used to undermine union organizing efforts.

Unions, in turn, used the San Jose hearing to expose the exploitation of contingent workers. Esther Thompson, a janitor who cleaned Apple’s buildings, told commissioners that she needed two jobs “because neither pays enough to pay [her] rent, feed [her] children and pay [her] bills.” According to Local 1877’s Garcia, “high-technology manufacturing doesn’t create high-wage, high-skill jobs. It patterns itself after the service sector. Contractors in manufacturing compete over who can drive wages and benefits the lowest.”

Ultimately, the companies’ sought-after changes to the National Labor Relations Act—to protect their management-through work-teams programs—proved unnecessary. The commission issued a report and disbanded, and no labor law reform was ever proposed by Clinton. In the end, the high-tech industry didn’t really need it. While janitors held onto their Silicon Valley contracts, the era of efforts to organize in the plants themselves had ended.

In the hearing’s only real exchange between commissioners and witnesses, Thomas Kochan (an MIT management professor) and Doug Fraser (past president of the United Auto Workers) asked industry representatives if they’d allow their workplace committees to actually bargain with management over wages and working conditions. “The concept of representation seems archaic,” responded Cheryl Fields-Tyler from the American Electronics Association. Fraser asked what alternatives existed for workers unhappy with management decisions. Debra Engel, vice-president of digital-electronics manufacturer 3Com, answered: “the company has an open-door policy.”

The audience laughed.