Apple retail workers are getting a big pay boost as the company announced plans to raise wages by 10% or more this year, bringing the starting pay for retail workers to at least $22 an hour. The tech company is reckoning with the worst inflation in decades, a historically tight labor market and fighting union efforts at its stores.

Vice published leaked audio from a video that was reportedly circulated to retail employees this week. According to Vice, the voice behind the video is Apple Vice President Deirdre O’Brien, who oversees retail.

“We have a relationship that’s based on open and collaborative and direct engagement, which I feel could fundamentally change if a store is represented by a union under a collective bargaining agreement,” O’Brien is heard saying in the video. “And I worry about what it would mean to put another organization in the middle of our relationship, an organization that does not have a deep understanding of Apple or our business, and most importantly, one that I do not believe shares our commitment to you.”

Pay increases are not the only challenge squeezing the tech company. It has had a rough start to the year over COVID-19 lockdowns in China, where most of its phones are made.

Bloomberg reported that sources say the company is now looking to assemble 220 million phones this year, which would be about 8% less than market forecasts. Apple declined to comment on the report.

The supply problems are even worse for its competitors. While Apple hopes to stay flat with the help of a loyal customer base, the smartphone market as a whole is expected to contract after just suffering the worst quarter drop since the start of the COVID-19 pandemic.