Sodexo
by Philip Mattera
Sodexo, based in France, is one of the global giants of the foodservice industry, with operations in about 80 nations. In various countries, but especially in the United States, it has been at the center of controversies over working conditions, wages, labor relations and discriminatory practices.
A Family Tradition
In 1966 Pierre Bellon, who came from a family long involved in the cruise ship industry, founded Societe d'Exploitation Hotelier, or Sodexho, to apply that expertise to onshore businesses and thereby became a pioneer in the foodservice sector. Within a few years, the company expanded beyond France to countries throughout Europe and then to parts of Africa and the Middle East. Apart from its operation of institutional feeding facilities, Sodexho introduced a voucher service for use in restaurants, at gas stations and elsewhere.
During the 1980s the company began buying up U.S. foodservice and other businesses that were put under the Sodexho USA umbrella. It also used acquisitions to grow in Europe and Scandinavia with purchases such as Gardner Merchant and Partena. After acquiring Ogden Services in 1997 it changed its name to Sodexho Alliance. That same year, Sodexho merged its North American operations with the foodservice business of the Marriott hotel chain to form Sodexho Marriott Services, which was renamed Sodexho Inc. after Sodexho bought Marriott's share of the company. In 2008 the parent company shortened its name to Sodexho SA and changed the spelling to Sodexo.
Contracting Controversies
In 2002 the U.S. Marine Corps awarded Sodexho two multi-year contracts estimated at the time to be worth up to $881 million to provide food and related services at all Marine Corps mess halls in the United States. In 2010 some members of Congress expressed concern over evidence of large cost overruns that had increased the cost of the contracts by 36 percent (Congressional Quarterly Today, September 2, 2010). Sodexo got another Marine contract in 2011 but it was smaller than expected.
In 2010 Sodexo had to pay $20 million to settle charges filed by the New York State Attorney General accusing it of overcharging 21 school districts and the state university system by failing to pass along savings obtained through rebates from suppliers.
Private prisons
In 1994 Sodexho acquired a 20 percent stake in Corrections Corporation of America and formed a joint venture with the private prison company for pursuing projects outside the United States, the United Kingdom and Australia. Sodexho became CCA’s principal non-U.S. shareholder and Sodexho director Jean-Pierre Cuny joined the CCA board. At the time, Sodexho had operations in 46 countries and through its SIGES subsidiary provided non-custodial services to six French prisons. In the early 1990s Sodexho had formed a subsidiary in the U.K. called ManCare. But after the company’s failure to win any contracts, Sodexho shut the company down.
Sodexho became the 50 percent joint owner of Corrections Corporation of Australia in the second quarter of 1995. In December 1996, CCA sold Sodexho 20 percent of UK Detention Services Ltd and a further 20 percent in the first half of 1997, making Sodexho its 50 percent partner in the UK.
By the end of August 2000 Sodexho provided non-custodial services to eight prisons in France, five in Spain, three in Italy, 21 in the Netherlands, one in Belgium as well as having a stake in CCA’s joint venture operations in the UK and Australia. Yet in 2001 Sodexho announced that it would sell its holdings in CCA.
Racial Discrimination
In 2005 Sodexo had to pay $80 million to settle a lawsuit claiming that it systematically denied promotions to some 3,400 African-American managers.
Workplace Safety and Health
In 2008 the Occupational Safety and Health Administration announced fines of $111,540 and then an additional $15,675 against Sodexo for violations for potential hazards relating to burns, electrocution, etc. at an industrial laundry in Buffalo, New York. The company negotiated reductions in the amounts.
In 2012 OSHA announced fines of $81,000 against Sodexo for failing to provide respirators and other safety equipment for maintenance workers it employed at a college in West Virginia who were exposed to asbestos. The company negotiated the penalty down to $56,700.
In 2010 the New York Times calculated that OSHA had "carried out at least 132 enforcement inspections arising from incidents at or complaints about conditions at Sodexo or its units" during the previous ten years.
Labor Relations
Sodexo clashed with union organizing drives at various U.S. locations, such as Tulane and Loyola universities in New Orleans, where in 2010 the city council heard complaints from workers about substandard wages and unfair working conditions (Times-Picayune, April 14, 2010). Sometimes disputes continued even after a union presence was established. In 2010 cafeteria workers at the University of Pittsburgh represented by the Service Employees International Union (SEIU) staged a two-day walkout during a contract dispute (Pittsburgh Post-Gazette, April 29, 2010).
A number of the campus labor disputes involved solidarity actions by student groups. For example, at Ohio State University in 2010 a demonstration of 100 students staged a protest in support of Sodexo foodservice workers at the school (Columbus Dispatch, April 16, 2010). In 2011 25 students at the University of Washington were arrested during a sit-in supporting Sodexo workers (Seattle Times, May 12, 2011).
A 2010 report by Human Rights Watch described anti-union activities -- including captive meetings and the firing of union supporters --at several of Sodexo's U.S. facilities.
During this time the SEIU launched an aggressive corporate campaign against the company to get it to end its opposition to the organizing efforts. This included protests at the company's headquarters in France and efforts to get school administrators to stop doing business with Sodexo unless it changed its labor policies. In 2011 the company filed a federal racketeering lawsuit to try to force the union to end the pressure campaign. Within a few months the parties reached a confidential settlement under which the lawsuit was dropped Sodexo and the company reportedly agreed to modify its hard-line labor stance.
In 2011 TransAfrica Forum published a report documenting abusive working conditions -- including low wages, wage violations and excessive hours -- at Sodexo facilities in countries such as Colombia, Guinea, the Dominican Republic and Morocco.
In 2012 Sodexo signed an agreement with the International Union of Foodworkers expressing a commitment to freedom of association for its workers around the world.
Food Safety
Sodexo has been cited for food safety violations in a number of its facilities, including Binghamton University in New York in 2016; Drexel University in Philadelphia in 2015; and Rensselaer Polytechnic Institute in New York in 2014.
In 2013 Sodexo had to withdraw beef products from its facilities in Britain after the discovery of horsemeat DNA during the testing of some samples.
In 2012 thousands of children at nearly 500 schools and day care centers run by Sodexo in Germany were sickened in an outbreak of food poisoning linked to tainted frozen strawberries.
Other Information Sources
Violation Tracker summary page
Watchdog Groups and Campaigns
American Federation of State, County and Municipal Employees
American Friends Service Committee: Investigate
International Union of Foodworkers (IUF)
Private Corrections Working Group
Service Employees International Union
Key Books and Reports
A Strange Case: Violations of Workers' Freedom of Association in the United States by European Multinational Corporations (Human Rights Watch, 2010).
Hard to Swallow: Did Food Service Contractors Shortchange New Jersey's Schools? by Tom MacDermott (Clarion Group).
Out of Control: The Coast-to-Coast Failures of Outsourcing Public Services to For-Profit Corporations (In the Public Interest, December 2013).
Pay to Prey: Governors Facilitate the Predatory Outsourcing of America's Public Services (Center for Media and Democracy, October 2014).
Race to the Bottom: How Outsourcing Public Services Rewards Corporations and Punishes the Middle Class (In the Public Interest, June 2014).
Voices for Change: Sodexo Workers from Five Countries Speak Out (TransAfrica Forum, 2011).
Last updated November 21, 2016