Julia Love

SAN FRANCISCO. (Reuters). Mapbox managers came up to workers with shocking news in June. They revealed that the company had lost $150M. Worker organizing is to blame.

Prior to the all-hands meeting over Zoom, roughly two-thirds of the SoftBank-backed startup’s workers had signed cards indicating their desire to unionize, part of a wave of organizing in Silicon Valley.

But after Mapbox management disclosed the botched investment – and said they worried funding trouble would persist if workers formed a union – the tide turned, one current and one former employee said. Mapbox employees voted against unionization. The company, valued at over $1 billion at its latest private funding round, has been in contact with companies known as blank checks about going public.

Mapbox’s reply offers insight into how tech companies respond to unions seeking workers.

The Communications Workers of America and Office and Professional Employees International Union launched Silicon Valley campaigns, organizing employees at startup companies like Kickstarter and Glitch. CWA created the Alphabet Workers Union (NASDAQ:) which is a minority union without collective bargaining rights.

As unions continue engaging with workers, a playbook among tech companies is emerging, according to interviews with tech workers and union organizers: Warn employees about the impact a union would have on the startup’s prospects and, in particular, its ability to raise funds. Workers should be reminded of the privilege they have to question why they require a union. To make the point more clear, you can also hire consultants and law firms to assist.

“Tech firms are willing to do whatever is necessary to keep unions out,” said John Logan, a labor professor at San Francisco State University. “They might think unions are fine for food-processing workers or for miners, but not in the tech sector.”

SHIFTING POWER DYNAMIC

The unions’ pushes are at an early stage, and it remains to be seen whether they will catch on widely. Interviews with workers indicate that there is a wider renegotiation taking place between tech companies, and employees.

Many tech workers don’t just want a large paycheck. According to tech workers, organizers and managers, they also need safe work conditions and the assurance that their products will not be harmful to society.

However, workers in high-risk and high-reward startup jobs are not likely to compromise the stock option value or risk their employment. Wes McEnany (a CWA Campaign Lead), said that warnings about funding are effective.

According to ex-employees, the management said that unionization would threaten future funding for Kickstarter and Glitch. McEnany stated that Medium’s Chief Executive Ev Williams warned workers investors could be reluctant to invest if the union won.

Mapbox stated in a statement that “after considering the costs and benefits, our employees voted unanimously against forming unions.” Mapbox stated that it was the employees’ decision and they did so unambiguously. We’re now focused on growing our business and supporting our customers.”

Glitch, Kickstarter, and others declined to comment. Williams did not reply.

According to U.S. law companies cannot threaten employees that they may lose their jobs if unionization is done. However, they can forecast adverse outcomes, according Gordon Lafer of University of Oregon’s Labor Education and Research Center.

THE VERY SCARY NUMBER

Reuters spoke with some financial advisors and investors who felt that unions for startups were a problem because they made it difficult for businesses to cut back on workers, and make it easier to establish more compensation guidelines.

But Roy Bahat of Bloomberg Beta Venture Capital said that he was skeptical investors will pass on the opportunity to invest in hot startups because they have unionized workers.

“In the same way that (venture capitalists) overcome lots of obstacles to investing – everything from PR dilemmas to regulatory vulnerabilities to cofounder issues – unions are just another aspect of a company,” Bahat said. “They’re not fatal.”

In August, Jackson Lewis, a law firm known for its work in union avoidance, released a podcast https://www.jacksonlewis.com/event/unlikely-marriage-unions-and-tech-employees episode titled: “The Unlikely Marriage of Unions and Tech Employees.” Jackson Lewis lawyer Laura Pierson-Scheinberg said she was inspired to record the podcast by the increasing number of calls she received from tech companies inquiring about the prospect of union campaigns.

Pierson-Scheinberg stated that the shift from working at home to work has weakened ties between workers and companies, opening up for unions.

Mapbox’s strong links to charities are well-known. However, in recent times, some Mapbox employees began to worry about how mapping technology is being used by clients. One current and former employee stated that this concern was growing over time.

Mapbox’s relationship with software company Palantir Technologies (NYSE:) Inc was of particular concern, one former employee said. In the case of future layoffs, workers also wanted formal support.

Palantir couldn’t be reached immediately for comment.

Members of the Mapbox Workers Union stated on their website that they have joined forces “to create a lasting and accountable Mapbox that is inclusive.”

Mapbox management offered a range of reasons against unionization. However, workers were particularly sensitive to funding concerns. According to one worker, workers were seen shaking their heads when management spoke of Zoom’s failed investment. Some workers had previously supported the union and told organizers that they’d had a heart attack.

According to one employee, the failed $150 million investment was “very large” and “very scary”. “The fear that that instilled didn’t go away.”