Workers Cheer Return of Ousted Market Basket CEO

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Supermarket Feud
Steven Senne/APMarket Basket employees hug after watching a televised speech by restored Market Basket chief Arthur T. Demoulas.
By DENISE LAVOIE

BOSTON -- As Arthur T. Demoulas made a triumphant return Thursday to lead the Market Basket supermarket chain, it was the words of his employees that summed up their fierce loyalty to him that led to a remarkable workers' revolt that nearly crippled the New England chain but eventually put him back on top.

"We did it for you!" one employee yelled back at Demoulas as he addressed a crowd of supporters outside the company's headquarters. "We love you!" shouted another.

It was a moment few thought would happen six weeks ago, when employees walked off their jobs after Demoulas was fired. Not only did the workers stick together, but customers soon followed by boycotting the stores in solidarity.

Late Wednesday, after weeks of pressure, the company announced that an agreement had been reached for Demoulas to pay $1.5 billion for the 50.5 percent of the company owned by his cousin and rival, Arthur S. Demoulas, and other family members.

'In Awe'

Workers and customers celebrated Thursday at a rally outside the chain's Tewksbury headquarters, where Arthur T. Demoulas, speaking from the back of a truck, told them, "I am in awe of what you have all accomplished."

Demoulas, 59, was fired in June by a board controlled by Arthur S. Demoulas. To protest, hundreds of warehouse workers and drivers refused to deliver fresh produce to the chain's 71 stores, leaving shelves depleted.

Customers soon began shopping elsewhere, some because they couldn't find fresh food at Market Basket, but others stayed away in a concerted show of support for the workers and Arthur T. Demoulas. The usually crowded stores turned into ghost towns, with only a trickle of customers.

Employees said it was their allegiance to Demoulas that kept them united. Demoulas is beloved by the workers not only for offering generous benefits -- including a profit-sharing plan -- but also for stopping to talk to workers, remembering birthdays and attending funerals of employees' relatives.

"He'll walk into a warehouse and will stop and talk to everyone because he's genuinely concerned about them," said Joe Schmidt, a store operations supervisor. "He cares about families, he asks about your career goals, he will walk up to part-timers and ask them about themselves. To him, that cashier and that bagger are just important as the supervisors and the store management team."

Schmidt said Demoulas once called a store manager after he heard the man's daughter was critically injured in a car crash. Demoulas wanted to know whether the hospital she was in was giving her the best care possible. "Do we need to move her?" he asked, Schmidt said.

"He is just a good man," Schmidt said.

Big Losses

The chain, known for its low prices, lost tens of millions of dollars during the standoff. As part-time employees saw their hours cut and Market Basket's suppliers began to complain about lost revenue, the governors of Massachusetts and New Hampshire took the extraordinary step of getting personally involved in the negotiations.

Business analysts said the devotion shown by employees to Demoulas is highly unusual in the corporate world, where there is often a huge gap between workers and their CEOs.

"Most times, CEOs and the company's business model don't always align with the employees' best interests," said Paul Pustorino, an accounting professor at Suffolk University's Sawyer Business School.

"What this proves is when a CEO can align the best interests of the company with the best interests of the employees, that generates strong employee loyalty and customer loyalty."

Workers celebrated in Market Basket stores as customers began to return.

"I am thrilled!" said Shannon Mort, a cashier at the West Bridgewater store's cafe.

"We couldn't wait to get back," Barbara Farrell, 74, said as she and her husband filled their shopping cart.

In a Market Basket store in Portsmouth, New Hampshire, 93-year-old Al Gerrato said it felt like "the end of the war."

"It becomes part of your family, and you feel like you just can't stop any other place and get anything, you have to come to Market Basket."

-Associated Press writer Holly Ramer contributed to this report from Portsmouth, N.H.


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16 Comments

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rostra

Perfect, the family members who wanted him out, stated, we desired higher profits. Only two ways in retail, cut employees, and raise prices, this scenerio played out right, everyone wins, including his relatives, now billionaires.

September 01 2014 at 9:09 AM Report abuse -1 rate up rate down Reply
albertbbruno

a true example of a mans man and a great company leader. Many more should follow his example
and look at the employee's dedication to his styles and beliefs as far as the comment that the customers will leave, guess again they will side with the "new"management team and they will prosper part of the "yankee loyality"

August 31 2014 at 1:00 PM Report abuse +1 rate up rate down Reply
jtobend

tHIS IS A PRIME EXAMPLE OF THE RIGHT WAY TO RUN A BUSINESS, AS A MUTUALLY BENEFICIAL RELATIONSHIP WITH EXCELLENT MANAGEMENT AND WORKERS CARING FOR AND HELPING EACH PROSPER

August 30 2014 at 4:49 PM Report abuse +1 rate up rate down Reply
fakeconomics01

It is an amazing story - I am delighted to see workers and CEO are together in this fight

August 28 2014 at 4:59 PM Report abuse +7 rate up rate down Reply
anniec18ma

HURRAY HURRAY the workers togetherness on backing of the CEO and bringing Market
Basket to a great halt is commendable.
UNITED THEY ALL WERE in achieving a task no one ever thought it would help. Wrong for
sure, I think that managment will think twice about making any changes not in the best interests
of the people. With so much happening in our world today, this proved the point THE VOICES OF WORKERS WILL BE HEARD AND LISTENED TOO. United WE stand really does work for
all. What a motto to have .

August 28 2014 at 2:01 PM Report abuse +5 rate up rate down Reply
anniec18ma

I have put a comment in alread. It is un signed.

August 28 2014 at 1:54 PM Report abuse -2 rate up rate down Reply
Erudite Male

For once in this beautiful country of ours dollars and cents did not rule! For once a CEO's dedication to his workplace and his employees has brought intense loyalty. For once a strike was in favor of an Executive. Customers will be loyal too and come back in droves. In fact I predict spurt in sales. Selfishness and greed are not a long term solutions or goals!

Some stupid and shorsighted people will call the strike into question because they have an axe to grind. I for one salute the workers. Loyalty breeds loyalty! Thank God for the workers who looked at the long term unlike our captains of industry and other flakes.

I salute the workers for portraying AMERICAN VALUES at what must be great cost to themselves. Hankisler is no doubt one of the reasons this country is in "decline" as some people put it.

Hope the rest of Capitalism learns from this episode.

August 28 2014 at 1:28 PM Report abuse +6 rate up rate down Reply
hankisler

I think the employee's were foolish to strike. The CEO is a billionaire and would care less if any of them were let go. If they were striking to get something for themselves, that would make sense. Going on strike because a CEO is let go, waste of time. Is he going to offer to make up all the paychecks they loss while on strike for him, I think not. I think because of the strike, people had to shop elsewhere. I am not so sure they will be so eager to come back.

August 28 2014 at 10:57 AM Report abuse -14 rate up rate down Reply
3 replies to hankisler's comment
alderaforall

Let's not count our chickens before they hatch. Until this deal is closed the former CEO isn't in charge. Lots of things can happen in the next few months, namely greed and lawyers.

August 28 2014 at 10:18 AM Report abuse +2 rate up rate down Reply
1 reply to alderaforall's comment
Dean Sutton

"Greed and Lawyers".... so true!!!!!

August 28 2014 at 2:01 PM Report abuse +1 rate up rate down Reply
jhooperaa

The world is on fire and America is in decline and people in the Boston area have been fixated on this story all summer. No wonder we are in decline.

August 28 2014 at 8:42 AM Report abuse -8 rate up rate down Reply
2 replies to jhooperaa's comment
DaveNavl

or America is in decline due to a lack of commitment and loyalty and this little story signifies a return to those missing qualities in one small example.
The perceived decline is also driven by those like yourself with the relentlessly negative take on all things-

August 28 2014 at 10:09 AM Report abuse +11 rate up rate down Reply
rostra

According to the WSJ, the our country has been in decline since 1979, with only the top 5% of wage earners showing an overall gain in earnings. They also say, since 1947-1979 the average America saw a 2.5% yearly increase in wages, in all five wage brackets. This company reflects how a business should be run, given the family members who forced him out, stated, we willbe making cuts to access higher profits.

August 31 2014 at 4:07 PM Report abuse +1 rate up rate down Reply