The Wayfair Effect Meets a Brick Wall at Palantir

Employees at the home furnishings company Wayfair raised the bar on employee activism when they staged a walkout in downtown Boston earlier this summer. That poses a challenge for workers at other companies, who have relied on petitions and open letters to lobby for change. A case in point is the big data firm Palantir.

Palantir in hot water over ICE contracts

Palantir is not a household name on the order of Wayfair and other consumer brands. However, since its founding in 2003 the company has established a solid record within the law enforcement and national security communities.

Palantir initially made its reputation by deploying data mining and analytic software to thwart drug cartels, terrorists, and bank fraud. More recently, though, the company’s reported involvement in racial profiling by domestic law enforcement has made it the target of privacy and civil liberties advocates.

The tipping point for Palantir employees is the company’s operational role in supporting the Trump administration’s treatment of immigrants, including mass deportations and its notorious family separation policy, through contracts with Immigration and Customs Enforcement, or ICE.

The Washington Post and Business Insider, among others, have reported that Palantir employees confronted CEO Alex Karp during an internal meeting to protest the ICE contract. Palantir employees have also circulated at least two petitions arguing against the company’s business with ICE.

The most recent petition, reportedly signed by more than 60 employees earlier this month, asks Palantir to assign the profits from its ICE contracts to charity.

Why Palantir probably won’t budge

The idea of a charitable giving solution seems like a dose of weakly brewed tea considering the human suffering at stake, but it may have been inspired by the partial success of the Wayfair walkout.

Plans for the walkout took shape after top executives brushed off an employee petition that expressed concern over the mistreatment of children in an immigrant detention center, for which the company had a contract to supply $200,000 worth of mattresses. The letter asked Wayfair to donate the profits to the immigrant legal services organization RAICES.

After the walkout, it seems that Wayfair executives took the request to heart. In an apparent compromise, the company pledged a $100,000 donation to the American Red Cross.

The donation exceeded the reported $86,000 in profits from the mattress contract, though the employee group has pointed out that donating to the Red Cross is not nearly as impactful as funding for RAICES would have been.

Nevertheless, Wayfair’s gesture appears to have had its desired effect. Calls for a boycott of the company drifted out of the media spotlight shortly after the walkout.

The charitable giving solution, though, hardly seems likely for Palantir.

That’s partly due to the scale of Palantir’s work with ICE. Its current contract dwarfs Wayfair’s mattresses, and on August 20 news surfaced that Palantir has entered into a new contract with ICE.

According to documents posted online by the General Services Administration and spotted by Mother Jones, the first year of the contract reportedly starts in September 2019 and is worth $16 million. With the potential for renewal options over the next two years, the total could come to about $49 million.

Corporate culture and Palantir

Given the scale of the ICE contract, it’s no surprise that Palantir has so far refused to accommodate the concerns of its employees.

Aside from the money involved, Palantir employees also face the additional challenge of the company’s corporate culture.

While much of the media attention has focused on the contradiction between CEO Alex Karp’s self-described socialism and Palantir’s business model, there is a superseding dynamic at work.

Palantir’s work with ICE may conflict with the worldview of its CEO, but it is almost perfectly aligned with that of its co-founder and investor, Peter Thiel, who has also served on the company’s board of directors.

Thiel has become a person of media interest in his unique role as Silicon Valley’s most visibly public, and instrumental, supporter of Donald Trump’s successful 2016 campaign. Regardless of the racist rhetoric, the choice to support the Trump campaign was of a piece with Thiel’s considerable financial support for the candidacy of Ron Paul, and his support for the anti-immigrant organization Numbers, USA.

In addition to financial contributions to the Trump campaign, Thiel stood as a California delegate for Trump during the primary cycle, delivered a keynote speech at the Republican National Convention and placed op-eds at key junctures during the campaign He also quashed a potentially influential media critic by funding a successful lawsuit against the news organization Gawker Media, which was spearheaded by Trump attorney Charles Harder.

Despite the 2017 “Muslim ban” that marked the beginning of Trump’s term in office, Thiel has remained in an advisory capacity to the administration, and was among the very first to donate to Trump’s 2020 reelection campaign.

Preparing for re-election

In the latest illustration of his behind-the-scenes role in formulating White House policy, on August 2 Thiel placed an op-ed in the New York Times excoriating Google for its work in China and all but accusing it of treason. The President followed up with a series of tweets on August 6, in which he supported and amplified Thiel’s article, and pledged that the White House will “take a look” at his accusations against Google.

In the context of corporate culture, Thiel’s op-ed also aimed at a company that is rooted in purposeful dissent, so much so that Google employees are already taking preemptive action by publicly pledging not to work on a potential contract with Customs and Border Patrol.

That kind of employee action would most likely not be tolerated at Palantir, especially not in the runup to the 2020 election cycle. As noted by Tech Crunch and others, Thiel and the President appear to be building a case against Google in advance of Election Day, by questioning the company’s loyalty to the U.S. and accusing it of election tampering, while positioning Palantir as a “patriotic” company.

With stakes that high, Palantir is unlikely to waver in its support for the Trump administration’s policies. Perhaps the only recourse for employees who are uncomfortable with the company’s policy on ICE contracts is to walk out, never to return.

Be sure to join us this fall at 3BL Forum: Brands Taking Stands – What’s Next, at MGM National Harbor, just outside Washington, D.C., on October 29-30, 2019. One theme we’ll explore is how companies, with employees at the helm, are reinventing themselves – whether it’s redefining their purpose, making social impact commitments or finding where to put a stake in the ground. Receive a 25 percent discount using this code PUNDIT2019AUGUST when you register here during the month of August, 2019.

Image credit: Maria Oswalt/Unsplash