Spyhouse workers narrowly vote against unionization; company rewards them with hazard pay

Spyhouse Coffee Co., the upscale Twin Cities chain with six locations, won’t become a union shop. An organized labor push that began in August fizzled out on Monday when 14 of 25 workers voted against unionization.

“Sadly, it appears management’s deceptive union-busting rhetoric proved more effective than we had anticipated,” Spyhouse barista Matt Marciniec said. “We felt extremely confident going into the vote; remember, we had 90% of our staff sign union cards at the very beginning of the campaign.”

Spyhouse owner Christian Johnson declined to comment through a spokesman.

Marciniec blamed a steady drumbeat of anti-union messaging coming from Spyhouse management and ownership. Following a one-day worker strike in September, he said the company attempted to “demoralize” its pro-union workers, resulting in around 15 departures.

Former worker Grace Erpenbach told City Pages last month she was called into a meeting and presented with a choice: Stop organizing or lose your job. If true, such a threat would violate federal labor law even if it’s a common tactic. A recent study by the left-leaning Economic Policy Institute found employers are charged with illegally firing employees in 20% of unionization efforts. Through a spokesperson, Spyhouse says Erpenbach was a manager and should not have participated in organizing efforts.

Erpenbach opted to quit, as did several of her colleagues in solidarity.

The new hires that replaced them were manipulated with “a hideous smear campaign,” Spyhouse’s would-be union tweeted Tuesday, one intended to “paint the remaining pro-union folks as a small group of fringe troublemakers.”

Even as labor organizers have celebrated unionization at a few Minnesota food and drink businesses lately, the Spyhouse defeat illustrates the difficult political, economic and legal environment for organized labor, especially as they undertake the expensive and labor intensive project of organizing small shops one at a time.

Following the vote, Spyhouse managers sent an email to employees on Wednesday announcing they would begin providing hazard pay through the end of the year and bonus pay for working on Thanksgiving and Christmas Eve.

“Given the election results, we were able to immediately start working on some of the asks brought to our attention,” the email reads. “We appreciate the vote of confidence as we work toward more Spyhouse improvements and growth!”

In an email before the union vote, the company told workers “we simply aren’t allowed” to make pay changes with the union petition in place, promising that a no vote would allow them to “resume working directly with employees to continue to make this a great place for everyone.”

After refusing to recognize his unionizing workers three months ago, Johnson proceeded to hire PR pros and lawyers to snuff out their efforts, said Unite Here Local 17, the hospitality union that represents about 6,000 Twin Cities workers and tried to organized Spyhouse. The 20-year-old company’s effort culminated with a proposal to outright sell the business to workers (Unite Here called this a bad faith offer that amounted to a political “stunt.”)

“We don’t believe that we need a union to work between leadership and all of you,” read a leaked October email from Spyhouse bosses to staff. “We have an open door to all of you, and we hope you feel and see that in our actions every day.”

The unionizing Spyhouse workers’ grievances were threefold:

Employees pointed to unclearly communicated COVID-19 safety protocols, including denied requests for plexiglass dividers and chaotic policing of mask use.

In June, discontent over an undemocratic workplace boiled over when an eight-year-old corporate memo resurfaced. The memo warned of “Black males” prowling around the downtown location, an “intoxicated Native American” and “street people” who are “panhandling to get money for alcohol.” Workers deemed the company’s apology insufficient.

Finally, Spyhouse baristas make minimum wage and meager benefits.

Forming a union from scratch isn’t easy.

A study of more than 22,000 union drives between 1999 and 2004 found that just over half clear the certification vote hurdle. John-Paul Ferguson, a McGill University professor and author of the study, pointed to frequent interference from management.

Even if workers succeed in voting to unionize, many fail to win a first contract. Ferguson found just 14% of unionization efforts ended up winning a contract within the first year.

Unionization has been on the decline in recent decades: Only 13.7% of Minnesota workers are union members, which is down from 23% in 1983. (It’s still higher than the national average of about 10%.)

But this year, unionization has had a renaissance, especially in the service industry, with the COVID-19 pandemic and police killing of George Floyd stirring workers to organize for greater economic and racial equity.

In the Twin Cities service industry, workers at Spyhouse, Lawless Distilling, Stilheart Distillery, Tattersall Distilling, Fair State Brewing Cooperative, and Surly Brewing Co. — all of whom were organized by Unite Here — attempted to form unions, with many pointing to what they viewed as unacceptable COVID-19 precautions.

The results of this resurgent labor movement, however, have been mixed.

Fair State became the country’s first unionized microbrewery. Tattersall Distilling— after some jockeying with ownership — became the first unionized craft distillery. The owners of Lawless and Stilheart distilleries both voluntarily recognized their unions.

At Surly, more than 100 workers were canned days after announcing their intention to unionize, when the company said it would be closing its popular beer hall indefinitely. (Bosses blamed the pandemic; Unite Here called it union busting.)

Those workers ultimately voted on a union on Oct. 7, with 56 in favor, 20 against, and 36 abstaining. That meant the country’s 34th-largest craft brewery failed to unionize by a single vote. Surly hasn’t said if it plans to re-open the beer hall.

So, what’s next at Spyhouse?

Unite Here Local 17 recently filed charges with the National Labor Relations Board asserting that Spyhouse retaliated against its unionizing staffers, according to union organizer Sheigh Freeberg.

The same report from Economic Policy Institute found U.S. employers are accused of violating federal labor laws in 41% of unionization efforts.

Marciniec isn’t sure whether Spyhouse workers will continue their union push for better COVID-19 protections, improved compensation, and more accountability and transparency from management, though he “wouldn’t rule it out.” Spyhouse workers drew inspiration from Tattersall’s, and Marciniec hopes other non-union service industry shops can look to Spyhouse’s organizing blueprint.

“It’s a defeat, it hurts,” he said. “But I’m proud of the fight we gave.”