How Apple Stores Went From Geek Paradise to Union Front Line

(Bloomberg Businessweek) -- The Apple Store where you’ll do some holiday shopping this year looks the same as always. White-oak tables in neat rows welcome you beneath a gleaming Apple logo, the same one you’d see at the store along the Champs-Elysées or in the shadow of the Burj Khalifa. There’s enough white light and open space to make you think you’re walking through a literal Consumer Heaven..And, of course, there’s the Genius Bar, a help center that for most of the past two decades has felt like something of a personal concierge service fueled by a small army of friendly, helpful nerds. Genius Bar staffers have generally been trusted to solve your problems, to fix your phone if they could, to replace certain busted headphones for free. In at least one case, captured this spring in a viral TikTok, a dedicated employee taught a coding class to an audience of zero, hoping someone would show up to learn. To this day, strangers flag down off-duty Geniuses for help wherever they see Apple’s signature blue T-shirt..Behind the scenes, though, things have changed, as interviews with dozens of Apple Store employees across nine cities make clear. Apple Inc.’s retail jobs have started to feel a lot more like, well, retail jobs..Workers say that whereas the focus of an Apple Genius used to be to impress customers with a high level of service, they and other employees are now increasingly pressured to upsell. They’re pushed to prioritize “ownership opportunities,” the company’s euphemism for persuading people to buy new gadgets instead of repairing their old ones. They’re also evaluated based on how many customers pay for an extended warranty through the AppleCare program and how many people they deal with per hour. Some stores email workers’ stats to colleagues or post them on the wall in employee-only areas, with those of lower sellers highlighted in red..At a store in Towson, Maryland, for example, management put up a giant laminated photo of a tree in the break room and told Genius Bar workers to add a stick-on label every time they made a sale. The labels included the customer’s name and the device’s serial number, so managers could verify them. “The tree pushed people to want to upsell,” says staffer Tyra Reeder. “You have to focus on your numbers being perfect.” While Apple has always used data to assess performance, employees say, which metrics it cares most about and the tactics it uses to boost them have changed dramatically. Kevin Gallagher, who’s spent seven years at the Towson store, says he’s seen the shift happen. “When I started with the company, it felt like the only number that they worried about was your customer service score,” he says, referring to survey results about consumers’ satisfaction. Today, “they’re looking to milk every last cent out of every square foot.”.Apple Store workers say the jobs were plum by retail standards until this transition, and for many they were dream jobs: getting paid to use their geekery for good. The money was decent (it’s now $22 an hour in the US, minimum), the benefits were strong (health insurance, pet-sitting help), and some of the perks matched the ones enjoyed by their white-collar counterparts (discounts on Apple products, occasional trips to the corporate headquarters in Cupertino). Also, Apple seemed to have a knack for hiring store managers who were relatively nice, even a little like Ted Lasso. Now, employees say, the sales pressure, exacerbated by understaffing, has made the jobs feel less and more . Increasingly, workers have concluded that the only way to regain the Apple experience they signed up for, and hold the company to the values it preaches, is to unionize. After the Towson store did so a few months ago, management stopped using the sales tree..Apple is the world’s most valuable company, at roughly $2.4 trillion, and it got that way in large part by maintaining extreme control over everything in its supply chain, from its App Store to the price it pays for glue. Now it’s struggling to keep its grip on its workforce. Nowhere is that clearer than at its 272 US retail stores. It isn’t just Towson: Workers at dozens of locations have begun discussing unionization, employees say. So far, only one other store has organized, in Oklahoma City, but its employees’ complaints are consistent with those elsewhere around the US. They want more money, more co-workers and less sales pressure. “Unionizing, it really is doing exactly what I was taught at Apple, which was to push the status quo, to not expect just the bare minimum,” says Leigha Briscoe, a six-year employee in Oklahoma City..“We remain committed, as always, to delivering the excellent Apple experience—for our customers, our team members, and the communities we serve,” the company said in a statement responding to a detailed inquiry about workers’ concerns. “Our retail and online teams connect with customers to help them get the most out of their products and ensure they receive an unparalleled level of support.” A spokesperson noted that the company doesn’t pay retail workers on commission and said it doesn’t require them to meet sales quotas..Apple also said, “We’re proud to offer our teams exceptional benefits and strong compensation, including new family support and education programs.” The company didn’t directly address the union campaign..Apple has, however, made its position clear to staff, including during (allegedly mandatory) meetings and in a video that retail chief Deirdre O’Brien sent to employees this spring. O’Brien told the workers that a union wouldn’t be as committed to their well-being or as quick to solve problems as Apple corporate. “I worry about what it would mean to put another organization in the middle of our relationship,” she said. Per usual for Apple, each copy of her video had the recipient’s employee number scrolling across it, meaning that if someone chose to leak the video, publishing it would expose them..No peer has anything quite like Apple Stores. They quickly overtook Tiffany & Co. stores in terms of revenue per square foot. Just as important, the Apple Store is supposed to be a vibe. Its retro-futuristic je ne sais quoi, a key element of Apple’s cultural cachet, lands somewhere between a midcentury lounge for the jet set and a vision of a world without crass commercial impulses. (Gene Roddenberry’s future, famously, abolished money.) It’s a shop, but also a place where you hang out between appointments, grazing the internet or trying on different headphones for fun. “It’s also part temple, to go worship at the altar of the brand,” says retail consultant Paco Underhill..The company gets much of its sheen from a sense that it doesn’t just hawk products, it offers a lifestyle. That image has largely held over the past decade, even as more than a few rivals have released good-to-great phones for less money. The recent shift comes with serious downsides, says retail pioneer Joe Pine, who co-wrote the much-cited 1999 book . “The mistake that so many companies make, as I think Apple has started to do, is they commoditize themselves,” he says..Pushing staff to work faster and upsell more is “exactly the wrong thing to do,” says Pine. “Short term it can help your sales, but customers are going to get what’s going on.” .One of the wrongest headlines of all time was published in 2001: “Sorry, Steve: Here’s Why Apple Stores Won’t Work.” Back then, Macs made up only 2.8% of the US market. Our reporter argued that Jobs would be better off selling cheaper stuff, Velveeta rather than beluga caviar. (It was a different time.) But the stores proved exemplars of what’s known as experiential retail, in which companies like Sephora USA Inc. and Nike Inc. try to build brand loyalty by making retail outlets into destinations where people feel encouraged to linger. Today, Apple has about 13% of the US market for personal computers, according to researcher Gartner Inc. More important, it sells 55% of Americans their smartphones..From the beginning, the stores played an incalculable role in building Apple’s allure. In the era of iMacs and iPods, it distinguished itself by framing its stores as casual hangs. “We would talk about how awesome our jobs were, because all we all had to do today was go and talk about the power of the Mac,” says 15-year employee Graham DeYoung, a bargaining committee member for the new union in Towson, part of the International Association of Machinists, or IAM. “The training that we had was to talk about ‘the why’ instead of ‘the how.’ … You would have an hour-and-a-half or two-hour conversation with someone. You’d test cameras.”.Employees say things began to change after Tim Cook took over the company in 2011, and that the shift has intensified since he put O’Brien, who’d been running HR, in charge of the retail division in 2019. In morning meetings, managers started prioritizing the conversion of repairs into sales, spending more time shadowing employees on the floor and chiding them for failing to upsell. New gimmicks emerged, including Towson’s tree and, in Oklahoma City, a bingo game with candy as a reward for selling accessories such as the Apple Pencil stylus. High performers got shout outs in meetings; low performers got called out on spreadsheets..Fanboys made up an outsize share of Apple’s early retail staff. Now there’s less exploring and educating, more cajoling and coercion—and less time to take a breath. “It kind of killed my spirit a little bit,” says DeYoung, who once called off from work so he could drive from Los Angeles to Cupertino in hopes of spotting Jobs in the parking lot. “As a technician, my heart is to fix your shit. That’s what I want to do,” he says. “But what I’m encouraged to do is to say, ‘Well, this is what your phone is worth for a trade-in.’ ”.O’Brien didn’t provide comment for this story, but in a fall 2021 speech to students at Michigan State University, her alma mater, she said of Apple: “We feel like we’re not only focusing on doing fantastic work for our customers, but we really are working to make the world a better place.” She also told students that her motto was: “There’s no growth in the comfort zone.”.Employees say the sales pressure has been exacerbated by the heightened focus on increasingly onerous quotas for customers handled per hour and by having too few people scheduled to work a given shift. And these days, of course, very few customers are chill when their phone is on the fritz..For investors, Apple’s approach seems to be working. Last month, the company announced record fourth-quarter revenue of $90 billion, including $71 billion of product sales, up from $52 billion for the same period three years earlier. It’s tough to know how much of that is attributable to Apple Stores, though, because the company didn’t separate out their sales from those of other sellers or online channels..Workers say the jobs have become utterly draining, and that compensation hasn’t kept pace. The $22 hourly minimum, raised from $20 after a couple stores announced union drives, beats the $15 floor at Starbucks Corp. but represents about three-fifths of what it takes for an adult with one child in Towson’s metro area to support a household, according to the Massachusetts Institute of Technology’s Living Wage Calculator. (An Apple spokesperson noted that the company provides benefits including mental health support, fertility assistance, LGBTQ+ wellness programs, telehealth and virtual care tailored specifically for Black and Latino staff.).Apple Store culture, which emphasizes honest feedback and perpetual improvement, has changed along with the incentives. Employees say they’ve been told that they seemed angry after having a panic attack at work and to direct concerns about understaffing to co-workers who called out sick. Seven-year employee Anthony Viola, who recently left the company after his union drive stalled out, says he was repeatedly questioned about his commitment after missing a chance to upsell. Viola says that when the published an article about workers allegedly retaliated against for dissent, a New York City store manager gathered staff for a meeting where she had them stretch their hands high in the air, then higher, to illustrate the “reserves” they should each tap to power through controversy and keep serving customers..Around the time retail employees were growing disillusioned, cracks in Apple’s control over its workforce were emerging elsewhere. While the company has been dogged by scrutiny over more dire conditions in its international supply chain—workers for its supplier Foxconn in China began walking off the job at the end of October—high-profile labor unrest in the US is a more recent development..Shortly before the pandemic, Apple’s US contract workers, including people working on the Maps app at an unmarked building in Sunnyvale, California that they called a “black site,” began speaking out about sparse sick days, arbitrary firings and restrictions on talking directly to Apple employees or even using the same bathrooms. (Apple has said an audit of the Sunnyvale office found it measured up to other Apple workplaces.) In the years since, Slack has helped bring formerly siloed software engineers and product managers together. Many have used the messenger platform to share experiences and circulate petitions demanding action on issues like sexual harassment, safety concerns, return-to-office pressure and the hiring of the author of a book that called women “weak.”.Several of those activists allege that Apple forced them out and have filed complaints of illegal retaliation that are pending with the National Labor Relations Board. Some also took road trips to visit the company’s retail stores, where they handed out cards with the slogan “Think Equitable” and QR codes that lead workers to union organizers’ contact info and a national chatroom on Discord..While activism continues among the company’s software workers, many have left in search of better treatment, says Cher Scarlett, a software engineer who helped create the AppleTogether website and Discord server. “On the retail side,” she says, “they’ve been experiencing these kinds of issues for a long time, and they want them to be addressed, and they want to stay.”.A couple of years ago in Towson, a bunch of workers decided to test the boundaries of Apple’s regular requests for feedback by all proposing the same reform: Given how draining their jobs were, they wanted four-day work schedules without pay cuts, the equivalent of a 25% hourly raise. They say the response was a familiar promise that the idea was being “bubbled up” to management, after which it was never mentioned again. “It’s like writing a letter to Santa,” says three-year employee Eric Brown. “Pretty much just like an empty slot that leads to a fire pit.”.“Then we were like, ‘What can we do now?’ ” says 12-year employee William Jarboe. Shifting Covid-19 protocols frustrated workers who felt they weren’t adequately involved in decisions about their own safety. When they raised concerns or asked for hazard pay, managers scoffed or said they were lucky they didn’t get laid off. (An Apple spokesperson said the company continued to provide hourly employees pay and benefits even when the stores were closed because of the pandemic and expanded the leave it offers.) So employees started talking to an IAM organizer and over months secretly built support among colleagues. In May, once they’d signed up 65% of the store, they petitioned the NLRB for an election..Things got ugly, Towson employees say. Managers, including many flown in from out of town, held mandatory anti-union meetings, suggesting that contract talks would cost workers pay and benefits. Managers also cited the union’s history of being racist in the 19th century as evidence that it couldn’t be trusted. In one meeting, a Black manager touched her skin and told employees, “They don’t care about us.”.Gallagher, the seven-year Towson employee, says he heard from colleagues that managers making anti-union arguments were privately bad-mouthing him as someone “nobody respects.” When he complained to a manager, they referred him to HR, which took no action. “They told me that everybody is allowed to have their opinion about this,” he says. A few weeks later, his side won the unionization election, 65 to 33. .Workers say Apple’s anti-union tactics have gotten more traction elsewhere. In Atlanta, at the first store that called for an election this spring, the Communications Workers of America withdrew its petition the week before the vote, citing the company’s conduct. Managers compared the union to thugs, according to Derrick Bowles, a Genius who now advises pro-union Apple retail workers across the country on what to expect. One talking point he heard from a manager during a discussion about unionizing: “If I have a problem with my wife, I don’t go talk to my mistress.”.The NLRB is investigating union-busting claims that the CWA filed against Apple in Atlanta and Oklahoma. In October the labor board’s general counsel issued a complaint accusing Apple of illegally coercing workers not to organize at a store in New York. (The company has denied wrongdoing.).Pro-union Apple workers across the US say some of their colleagues have also condemned standard organizing tactics as inappropriate or divisive, such as privately rating co-workers’ likelihood to support organizing, concealing the campaign from people who seem likely to oppose it and wearing pro-union armbands to work..“I’ve never worked for (or even have friends that have worked for) a company that cares about their employees the way Apple does,” a New York Apple employee wrote in a letter that the company shared with Atlanta workers during the union campaign last spring. “We don’t need to PAY a 3rd party to negotiate on our behalf to a company that already has competitive pay, really great benefits and perks that make other companies envious of what we have.”.And yet the unions, so far, are gaining ground. Organizers of public campaigns are advising those who are keeping quiet while they build support on trail hikes and at sporting events. They say they’ve been making headway in large part because Apple hasn’t been living up to its stated values. “I feel like a car salesman sometimes, trying to push something that I truly do not believe is the right solution for this customer,” says Patrick Hart, an organizer who works at the Oklahoma City store. “It has unfortunately now become a game of how hard can you push.”.By the time Hart’s store filed for a union election, he and other leaders were confident they’d win. The organizing committee of more than 20 employees had already talked to enough co-workers that two-thirds of the store signed CWA union cards within five days. Michael Forsythe, another organizer there, says they’d prepared colleagues for the company’s usual arguments against unions and the barrage of one-on-one anti-union meetings with managers. Before Apple started telling employees that unionizing could mean giving up benefits they already had, he’d already asked his co-workers to consider this: If the union really wouldn’t be able to wring more money out of management, why was the company willing to burn cash bringing in so many out-of-town managers to help defeat it?.On a Sunday night in October a few days before the Oklahoma City election, Apple held an all-staff meeting during which managers lined up to talk about why they loved the company. Then a regional boss started chiding the workers, asking whether, if he could read their private Discord chats, they’d be proud of what he’d see there. Then he noted that the union activists had said frequently, in response to concerns about losing benefits as a result of unionizing, that they would never “agree to less” in contract talks than what they already had. “But you’ve already agreed to less,” he retorted. “You’ve lost the culture in this store.” He didn’t take questions..“I felt like I was 12 again, and I got caught eating dessert out of the fridge by my stepdad,” Forsythe says. Around the same time, Apple told employees it was rolling out a suite of new benefits for all its US stores—except for Towson, because it had unionized and would need to negotiate first. The Oklahoma City workers still voted in favor of the union, 56 to 32. Pro-union workers traded hugs and decamped to a bar, where they fantasized about helping to organize the stores run by all the out-of-town managers who’d aided in the campaign against them. .Apple workers might not have organized in time to fully benefit from the tight labor market and federal friendliness that boosted similar efforts at places such as Starbucks. But the new sense of possibility among many employees won’t be easily unwound. That’s particularly true for some of Apple’s youngest staffers, who now see organizing less as a question of “why?” than one of “why not?”.A few years ago, the company seemed less ripe for employee organizing than the likes of Google, where thousands of tech workers walked off the job over its handling of harassment. But Apple had an important vulnerability: heavy reliance on service workers that it directly employed, many of whom were unhappy with their treatment and emboldened by action elsewhere. If they succeed, they could establish a labor beachhead at Apple that reinvigorates the company’s white-collar organizing, too..The more immediate task is getting a union contract. Federal law requires companies to negotiate “in good faith” after workers vote to unionize, but it doesn’t do a whole lot to ensure that happens. The Towson and Oklahoma City workers will have more leverage if other stores organize and if they can win over colleagues who voted no. If there’s no contract deal within a year, employees could petition to vote out the fledgling union, a possibility they say Apple has brought up. Workers at other locations say the company is already telling them nothing at the Towson store has improved. It doesn’t mention the removal of the tree or that union members called in for questioning about their metrics would now have the legal right to bring a colleague as a witness..Was all this inevitable? It’s tough to name anything that’s remained cool for two decades, let alone a retail store. In an era when the iPhone looks like a fairly mature line of business, Apple is trying to squeeze profits from every corner of its empire. And management philosophies tend to move in generational cycles, says Peter Cappelli, who runs the Wharton School’s Center for Human Resources. The more humane, holistic approach that undergirded experiential retail has drifted out of vogue in favor of a relentless push for short-term productivity, he says, adding that he prefers the experiential approach and expects it to make a comeback before long. “The next generation forgets, and then they start over,” he says..For now, Apple employees are bracing for a holiday rush that tends to mean grueling extended hours and pressure to handle as many as four customers simultaneously. One worker, who spoke on condition of anonymity because his store is preparing to call a union vote, says he started thinking differently about Apple a couple weeks before Christmas last year, when he was struggling through his shift with what was soon diagnosed as Covid. While talking to a customer, he found himself wobbling back and forth, bracing himself against a nearby table. After the customer left, a manager who’d been watching reprimanded him for not pitching AppleCare. “That was the moment where I kind of realized, ‘Oh, I’m working retail,’ ” he says. “It’s still the same BS. It’s just crafted in a prettier package.”.More stories like this are available on bloomberg.com.©2022 Bloomberg L.P.

How Apple Stores Went From Geek Paradise to Union Front Line

Store employees helped create some of the most valuable square footage in the US. Now they feel more like regular salespeople—so they’re unionizing.

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