The Teamsters Don’t Know What They’re Talking About

The Teamsters were out in semi-force on Tuesday morning, protesting a speaking appearance by KKR partner Alex Navab at the PEA Outlook conference in New York City. A bit of jeering, but mostly just handing out one-sheets about how KKR portfolio company Dollar General shouldn’t win any Employer of the Year awards. This is what they looked like (except in yellow):

STRAT_KKR Private Inequities

For a moment, let’s leave aside the unintentional comedy of blaming KKR for giving private equity a bad name (as if PE’s rep would be sterling if not for Henry Kravis and company). Instead, let’s focus on the lead allegations.

The Chinese working condition information was originally collected last May by an advocacy group called China Labor Watch, which co-sponsored Tuesday’s protest. It was then published seven months later, alleging labor abuses in four Chinese outsourcing facilities that produced goods later sold by Dollar General in U.S. stores.

Dollar General responded by denying having ever done business in two of the factories, and also saying that it no longer did business in the other two. China Labor Watch posted links to news stories about Dollar General’s denials on its website, although maintained that its original information was correct. Neither Dollar General nor KKR has commented further.

So we have some dispute, but agreement on the following point: Dollar General sourced some goods from scumbags. Dollar General also has publicly stated that it no longer uses said scumbags, and China Labor Watch tells me that it has no evidence to support or dispute Dollar General’s claim. In an email, CLW executive director Li Qiang writes:

“Production work is seasonal and this inspection took place at one of the busier points in the production year- the beginning of the busy season. At this time, it is especially difficult for companies to monitor exactly where all products are made. So it is possible that DG was unaware that current production was being sourced to the factories we investigated last May. Finally, it is also very possible that now that the busy season is over, DG no longer produces in these factories.”

But the Teamsters flier implied that such labor abuses were current and ongoing. Do they just not believe the Dollar General denial? Do they know something China Labor Watch does not?

Nope. The simple fact is that the Teamsters didn’t do a shred of due diligence, and such laziness undermines any credibility the union hopes to have on this issue.

I asked group spokesman Galen Munroe if he was aware that Dollar General had said it no longer uses any of the four factories cited by CLW. He said he was not. When I told him that the denials were available on the CLW website, he said: “I can’t verify what you’re telling me.”

I said I’d wait for him to go to the CLW website — or even do a basic Google search — but he simply repeated his “Hear no evil, see no evil” matra. When I asked if anyone at Teamsters had done any due diligence beyond reading the original CLW report, he said that he did not know. Also not knowing was another Teamsters rep he put me on the phone with. It was pathetic.

Look, I’m all for a good protest. Even a slightly hyperbolic one. But it should be incumbant on the protesters to have at least faint clue what they’re talking about.

It’s entirely possible that Dollar General — and, by extension, KKR — have enabled some horrible labor abuses in China. And it’s also possible that some of their oversight was lax. I take no stand on that one way or the other. All I know is that I don’t know what’s happening now. Neither do the Teamsters, so they should stop implying that they do.