Tech industry service workers in Silicon Valley fear wave of job losses

Recent layoffs have ignited fear among service workers that Silicon Valley high-tech firms, which have kept them on the payroll and covered by health insurance during the pandemic, may soon reverse course, creating a wave of job losses.

Although Facebook, Google, Intel and others have continued to pay their subcontracted service workers during the pandemic, Verizon laid off 120 cafeteria workers, Lyft 90 janitors and Cisco 88 cafeteria workers.

According to a recent study by the research and policy advocacy nonprofit Working Partnerships USA, about 14,000 subcontracted union service worker jobs would be lost if policies change. The subcontractors work as cafeteria staff, janitors and security officers.

In its study, “Serving Silicon Valley: Tech Giants and their Service Workers in the COVID-19 Pandemic,” Working Partnerships USA said about 63% of these workers are Black or Latinx. Among them, 46% are building security officers, 70% are cafeteria workers and 71% are janitors.

In early September, single mother Alma Cardenas, who is supporting two daughters ages 16 and 21, was let go from Verizon.

“It’s been very stressful thinking about how I’m going to pay my rent and bills,” Cardenas said. “I’ve had to cut back on a lot of things and find places to go for free food and to cover the basics.”

Cardenas said in the more than five years she worked at Verizon as a barista, she always gave it her all, smiling and chatting with customers while making their drinks.

“We’re part of this community and what makes this company successful,” Cardenas said. “They shouldn’t just forget about us.”

Cardenas said she fears becoming infected with COVID-19 and not having health insurance.

In September, after being laid off from Verizon, cafeteria workers repeatedly protested, calling on the company to rehire them.

On Nov. 17, holding signs and banners, they delivered letters at Verizon Media CEO Guru Gowrappan’s San Francisco home, sharing stories and calling on the tech giant to continue their pay and health care during the pandemic.

“In the early days of COVID-19, nearly all major Silicon Valley tech corporations announced they would maintain pay and benefits for their subcontracted workers while campuses are closed,” said Louise Auerhahn, director of economic and workforce policy for Working Partnerships USA. “This has been a crucial anchor of stability for the Black and brown communities that have been hardest hit by COVID-19.”

Nvidia, a Santa Clara computer hardware manufacturer, continued to pay its 130 subcontracted cafeteria workers during the pandemic, including lead cook Marcial Delgado, even though the campus was closed.

“I’m happy I’m still able to pay my bills and keep my house,” Delgado said. “Otherwise, I’d be homeless.”

Delgado, a single father with three children, ages 8, 11 and 15, has worked for almost 20 years with Nvidia. He said having health insurance protected his family from serious crisis, especially as one of his sons has asthma and another was sick and had to be hospitalized.

But as the pandemic lingers, concern has been raised about whether more workers are at risk of being laid off.

“Tech companies have talked about wanting to increase diversity… and that starts with fair treatment of the Black and Latinx people who already work for them,” Auerhahn said. “Keeping those workers on is really important as a racial justice strategy and I hope they will be able to continue to do so.”

More than 90% of subcontracted cafeteria workers have employer-provided insurance, Auerhahn said.

Peter Leroe-Muñoz, general counsel and senior vice president of technology and innovation policy for the Silicon Valley Leadership Group, said the ongoing pandemic is a challenge no business has faced before, and it has produced uncertainty for companies within and outside of Silicon Valley.

“As organizations struggle to keep their workers safe, and continue their operations,” Leroe-Muñoz said, “some companies have made the difficult decision to end their relationships with subcontractors.”

As no one knows when the pandemic will end, or what its ultimate economic impact will be, companies must thoughtfully assess their unique needs, he said.

Leroe-Muñoz said it is never easy to reduce staff and no company wants to be in that position, but the unprecedented economic reality may force some businesses to do just that.

“Providing for long-term staffing requires certainty about revenue and operations, and unfortunately, many companies don’t have that certainty in this economic and health climate,” Leroe-Muñoz said.

Sarah McDermott, political director of Unite Local 19, said so far, for the most part, big high-tech companies have been doing the right thing.

“Cafeteria workers at Facebook and Google are continuing to be paid throughout this crisis so they’re able to be home, be safe and help their kids with school work,” McDermott said. “Then there’s been a couple of exceptions to that.”

For the 100 Verizon workers, being out of work is a struggle and other jobs are scarce.

“It’s a scary situation,” McDermott said. “They are facing a lot of uncertainty. It’s important companies think about how this crisis is impacting their workers.”

McDermott said she is encouraged by companies that have stepped up and honored the health and safety of the workers who helped their campuses run.

Eurest/Compass Group USA, who supplies subcontractors to Verizon, did not respond to requests for comment. Cisco did not respond to requests for comment.

Contact Lorraine Gabbert at [email protected].

Editor’s Note: Derecka Mehrens, the executive director of Working Partnerships USA, serves on San José Spotlight’s Board of Directors.