As the largest consumer wholesaler and second largest retailer in the world, Costco employs nearly a quarter of a million people. With so many employees, it’s no wonder that questions of unionization get raised. So, is Costco unionized? And if not, are they union-friendly?
Costco Wholesale is 100% union friendly and has always allowed its employees to unionize. As of October 2022, Costco holds an active national contract with The International Brotherhood of Teamsters (IBT or the Teamsters Union). Prior to 2022, some Costco locations and employees had entered into union contracts with the Teamsters, but the recent national contract represents a first for the company.
The national agreement unifies previously unionized Costco locations from coast to coast in the US, guaranteeing consistency of wage increases and benefits. By signing the agreement, Costco promises to ensure that wage increases granted to non-union Costco employees will also be applied to union employees. The same works in reverse, where wage increases secured by union employees are automatically applied to non-union employees.
Keep reading to find out what else Costco’s recent Teamsters contract secures for Costco union members.
Unionized Costco Locations
Unfortunately, neither Costco nor IBT publish a definitive list of Costco’s current unionized locations. But, as of November 2022, the only unionized Costco locations are in former Price Club warehouse locations in California and parts of the northeastern United States.
Here is a list of Costco’s unionized locations in the State of California:
In total, less than 10% of Costco Warehouse locations are unionized.
How Costco Unions Work?
To understand how the Costco union works, it helps to understand how unions work in general.
A union is an independent organization of workers designed to leverage bargaining power through worker solidarity to secure the best possible wages, benefits, and rights for workers within a certain industry or company.
Along these lines, the Teamsters union works on behalf of Costco employees to secure optimal wages, flexible employment policies, pension benefits, and more.
Like all unions, the Teamsters union relies on union dues from individual members to function. To be a Costco union member, you must pay an initiation fee plus monthly membership dues. In exchange for this investment, you reap the benefits of union contracts and agreements.
Remember that not all Costco stores are union-staffed, and not all Costco employees are union members.
Costco Union Contracts
On October 21st, 2022, unionized Costco employees secured their first ever national Teamsters contract through a monumental agreement reached between the Teamsters union and the Costco Wholesale corporation.
At the time of the agreement, over 18,000 Costco workers nationwide were covered under the new union contract.
The national contract guarantees several things, including:
- Scheduled wage increases over the next three years (2023-2025)
- A promise to close the wage gap between union and non-union Costco locations*
- Semi-annual bonus increases
- Increased flexibility around scheduling and attendance
*One Reddit user explains the significance of closing the wage gap here:
Costco Union Pay
In light of the latest union contract at Costco, unionized Costco employees earn the same amount on average as their non-union counterparts. As detailed above, this prevents disincentivization of union membership and guarantees equity among Costco employees regardless of membership status.
As of November 2022, Costco employees earn an average of $17.69 per hour.
When it comes to union dues, these are generally quite low for Costco employees. While it costs $200 to be initiated into the union, the monthly due rate is only 2.5x your hourly rate. For example, if you make $15 per hour, then your monthly union due would be $37.50. This amount is automatically taken out of your paycheck if you are enrolled in the union. Remember that union membership is entirely voluntary and the vast majority of Costco employees are not union members.
Costco Union Benefits
When a company engages in a nationwide union contract, all employees of that company benefit regardless of whether or not they become union members. For this reason, there isn’t a very long list of benefits to becoming an individual union member if you’re already a Costco employee.
That said, there is one key benefit of becoming a Costco union employee, which is that union employees receive pension contributions while non-union employees do not. The basic rate of pension accrual for union Costco employees is 1.5%, meaning that for every dollar contributed to your pension plan, Costco will match that with a $1.50 contribution.
Who Are The Teamsters?
The International Brotherhood of Teamsters, known simply as “Teamsters” for short, is a North American labor union founded in 1903 and based in Washington, D.C. The Teamsters represent a range of blue-collar and professional workers in both the public and private sectors.
How To Join The Costco Union
To become a Costco union member, you first need to be a Costco employee. If you are already employed by Costco and would like to become a union member, you will need to speak to your store manager or supervisor and/or contact your local Teamsters union.
Unfortunately, Costco does not provide resources online for becoming a union employee.
Problems With The Costco Union
Regardless of how much you know about unions, you’re probably aware of the existence of pro-union and anti-union rhetoric. That’s because labor unionization is traditionally a very contentious topic, splitting workers along political lines and even forming the basis for entire political worldviews for some people.
But we won’t get into the nitty-gritty of unions as a whole today…
Common complaints about unionization at Costco include:
- Union dues and initiation fees
- Protection of lackluster employees
That said, the critique that unions protect “lazy” employees by making it harder to fire them doesn’t really hold much water. Unions don’t prevent incompetent workers from being penalized or let go, so the argument that unions protect or incentivize laziness is more of a distracting anti-union talking point than a legitimate critique.
Overall, the recent unionization at Costco has been very popular with existing union members (about 75% of union members voted in favor of the recent contract), and non-union members don’t seem to be bothered by it either.
As mentioned throughout this article, unionization at Costco promotes a more equitable and flexible work environment for all employees regardless of union status. And due to the recent contract, wages will be raised across the board over the next three years for all employees.
Is Costco Canada unionized?
Yes. However, most Costco Canada employees are not union members. Despite having a contract with the Teamsters union, Costco Wholesale does not require its employees to become union members.
Do grocery store union wages differ from wages at other stores?
Yes. Union grocery workers wages are determined by union contracts and can vary from about $12 to $22 per hour. Non-union grocery workers at places like Whole Foods and Trader Joe’s can make anywhere from $9 to $24 per hour depending on the employer and position. While wages vary between union and non-union grocery stores, all grocery workers earn wages within a similar range.
Do grocery stores have unions?
Yes. The United Food & Commercial Workers International Union (UFCW) is colloquially known as a grocery workers union. UFCW currently represents about 835,000 grocery workers worldwide, with the majority of those being US workers.
Are union grocery jobs good jobs?
This depends. Not all grocery stores contract with the same unions, and contract terms vary from company to company. Some union grocery jobs are better than others.
Does Costco give membership to employees?
Yes. All Costco employees are automatically granted a basic Gold Star Costco membership for the duration of their employment. Employees can also gift a free Gold Star Costco membership to three other people each year they continue working at Costco.
While Costco has always been a union-friendly company, their relationship to the Teamsters union has assumed a much larger role in recent years. Prior to 2022, a handful of individual Costco locations held contracts with the international Teamsters Union, but as of this year, the company now holds a national Teamsters contract. With this agreement, Costco employees are now guaranteed equal wages regardless of union status, and wages are also scheduled to be increased incrementally over the next three years.
Union employees at Costco also enjoy other benefits such as pension contribution.