Supermarket Chains Threaten Lock Out.

From the UFCW:
For Immediate Release

In a shocking display of contempt for both their customers and employees, the management of Ralphs, Albertsons and Vons jointly stated their intention to punish their employees for demanding a fair contract, deprive consumers of shopping options and potentially violate federal labor and anti-trust laws.

“With this announcement, the markets have very clearly said they would rather have a lockout or strike than compromise on a fair contract with their employees,” said Mike Shimpock, spokesperson for the Southern California Grocery Workers Union. “This is a foolish and risky escalation.”

“If they really wanted to protect their customers and employees, then they would have done what Stater Bros and Gelsons markets did: negotiate a fair contract with their employees on time,” he continued. “We do not want a strike, we want a fair contract. Our members have not had a wage increase since 2002, yet Ralphs, Vons and Albertsons are each averaging nearly $3 billion in profits and have given their CEOs as much as a 817% increase in pay, to as high as $9.2 million a year.”

Grocery Workers Union leaders are currently discussing next steps and communicating with their members, and will keep the community apprised of their plans.

The current contract extension expires April 9th, and then becomes a “rolling extension,” automatically renewing until one of the parties requests cancellation. The extension would then expire in 72 hours.

For more information on UFCW, issues involved in the current negotiations, and how you can help: Visit RespectUFCW.com

Stalled Grocery Talks to Resume
by Jerry Hirsch
Los Angeles Times
April 6, 2007

Talks between Southern California’s three major supermarket chains and a union representing grocery workers, which were abruptly halted Wednesday, are expected to resume in a little more than a week.

United Food and Commercial Workers union representatives said Thursday that they left the negotiating table after Albertsons, Ralphs and Vons declared they would lock out union workers if any one of the companies was struck.

“We walked out in protest,” said Rick Icaza, president of UFCW Local 770 in Los Angeles. “But we are going back. We want to settle this.”

Negotiation details are under a news blackout at the behest of a federal mediator, but individuals familiar with the situation said the two sides were scheduled to meet again April 16.

Although the verbal barbs being traded by the two sides make it seem as though Southern California is careening toward a strike like the one that turned grocery shopping into chaos more than three years ago, any potential work stoppage is weeks away.

Here’s a look at the likelihood of another strike and lockout and the issues behind the negotiations.

What is the earliest day another strike or lockout could occur?

Technically, the region could see a strike or lockout take shape April 13. The timing is dictated by prior contract extension agreements. But with talks resuming April 16, a strike is unlikely anytime in the next two weeks.

Union members have authorized a strike against Albertsons, but the UFCW has not set a date. The union also hasn’t made any effort to take strike authorization votes against Ralphs and Vons.

What happened in the last strike?

When the UFCW struck Vons on Oct. 11, 2003, Albertsons and Ralphs refused to let their unionized workforce enter their stores. The companies remained open with the help of management and replacement workers.

The 141-day strike created jammed parking lots and long checkout lines at retailers that were unaffected by the labor dispute, including Stater Bros. and Trader Joe’s.

What’s the likelihood of a strike happening again?

At this point, everyone from UFCW activists to Wall Street analysts are downplaying the chances of a strike.

Goldman Sachs analyst John Heinbockel points out that there have never been back-to-back strikes “in the annals of food retail negotiations…. The appetite for a fight usually isn’t there.”

Any strike, if it happened, is a long way off, said Michael Shimpock of SG&A Campaigns, a Pasadena media and political consulting firm hired by the United Food and Commercial Workers union to speak about the talks.

The employers said they remained “committed to working toward a peaceful settlement.” But one industry executive placed the chances of a strike at 60%.

What’s this all about?

Basically, wages and benefits, especially health insurance for workers.

The current contract, signed three years ago after the bitter 141-day strike and lockout, divided the unionized supermarket workforce into two groups.

Veteran workers received small wage bonuses and kept favorable health benefits. But the deal created a second tier of workers: people hired after the contract was signed.

These workers receive lower wages and benefits. For example, a new hire must wait at least 12 months, sometimes longer, to become eligible for health insurance. The waiting period for family coverage is 30 months.

The 65,000-member workforce is split almost evenly between those two groups. The union wants to get a better health plan for the new workers and is pushing for a pay scale track that gradually elevates all employees to first-tier benefits.

The employers said they liked the current system because it lowered their labor costs and made them more competitive with discount retailers.

What’s different from last time around?

Replacement workers. In 2003, the chains prepared for the work stoppage by hiring substitute workers starting six weeks in advance.

There’s no indication they are doing that now. Moreover, the grocers say they are not stocking up on goods in anticipation of a rush by strike-fearing consumers who want to stockpile.

What’s the same from last time around?

The mutual-aid agreement among Albertsons, Ralphs and Vons. The agreement calls for the lockout of employees from the three chains within 48 hours of a strike against any one of the companies.

The agreement also calls for the chains to provide financial assistance to any of the companies struck by the union.

Kroger Co., which owns Ralphs and the Food 4 Less chain in Southern California, paid a combined $146 million to Vons and Albertsons during the last work stoppage, according to the California attorney general’s office.

That money helped those companies to hold out during the long work stoppage, according to union officials and labor analysts.

But the deal might not have been legal. The state has sued the chains, alleging that the agreement violated federal antitrust laws. The employers insist that this type of agreement is legal. The companies said this latest pact did not allow for revenue or profit sharing, but they declined to disclose the terms of the financial assistance.

Should I begin stocking up on food and other packaged goods?

That’s a choice you have to make based on your budget and cupboard space. But consider this: Combined, Albertsons, Ralphs and Vons sell about half the groceries bought every year in Southern California.

Still, there are more choices now than three years ago. Most Targets sell packaged food and even have a frozen food section.

Many drug chains and convenience stores also sell packaged goods and have refrigerated milk cases. There’s always Costco, Wal-Mart, Trader Joe’s and Stater Bros., stores that were jammed during the last work stoppage.

How many stores might be involved in the work stoppage?

More than 65,000 members of the UFCW work at a combined 785 Albertsons, Vons and Ralphs stores from Bakersfield to the Mexican border.

Vons has 274 stores, Ralphs has 262 and Albertsons has 249.

Two other local chains, Stater Bros. and Gelson’s, which together control about 12% to 15% of the grocery market, signed labor agreements this year and would not be struck.

Link to the LATimes Story

  4 comments for “Supermarket Chains Threaten Lock Out.

  1. Flowerszzz
    April 7, 2007 at 12:49 pm

    I said it before & I will say it again…..grocery workers are doing themselves in. Sorry BUT they are nothing more then grocery clerks, baggers and shelf stockers. Hell, they even have do it yourself check out stalls at most grocery stores now….They are paid a good wage, for that work…they have benefits and job security. This job is not hard, dangerous or complicated.

    It makes NO difference how much the companies that own the grocery stores earn in profit, how does that entitle the clerks to more $$? I support 100% the lock out. Since the last strike I just don’t care anymore….and I will bet that most don’t care either. We have all adjusted to Trader Joe’s, Costco, Smart n Final etc.

    Grocery workers better tread warily on this path….. public sympathy was lost during the last strike (Obvious because it lasted so long) and it is not here at all this time. The unions here are not boding well for the grocery workers!

  2. April 7, 2007 at 7:13 pm

    Flowerszzz, unlike in 2003, the unions are negotiating with individual chains on contracts for their members. This is different in that they are not negotiating with all the chains together but separately.

    So Flowerszzz, let me get this straight. You think is is fair for Vons and Ralphs to lock out their employees because the employees over at Albertsons go on strike.

    You also say “It makes NO difference how much the companies that own the grocery stores earn in profit, how does that entitle the clerks to more $$?” I agree, store profits should not dictate whether or not employees get a raise. The only reason corporate profits are even brought up is because the grocery corporations are claiming that they are not making money. It is normal for most workers to get some sort of annual raise. From what I can tell, that seems to average between 3% and 5% depending on the industry. That pretty much keeps people some what close to on track with the annual increase in the cost of living. Salary increases are not an entitlement for employees, they are a normal and expected cost of doing business.

    Finally, if Stater Bros. and Gelsons have no problem reaching an agreement with their workers, I cannot understand why is it such a problem for the big three corporations who have the greater market share and therefore lower overall costs because of their volume.

  3. Flowerszzz
    April 7, 2007 at 7:28 pm

    Chris that may be true that the issues are “different” this time however, what I said before I stand by. The general public wont understand or care about the difference and quite frankly neither do I.

    Do I think it fair that they lock out all employess from the 3 chains if only one chain goes on strike – well NO – but is life fair? NO. To be perfectly honest, I think the chains should lock them out & hire scabs to fill in. Do I feel bad for the workers? Yes and no…..I feel bad that they are being pushed around by the unions, and not bad because they are paid well, have benefits and job security. Hopefully the workers will get smart and see the union is not benefitting them at all!

    I went to Vons today, for the first time in a long time. It was just more convienent today with tomorrow being Easter. I asked my checker about the potential strike, she knew nothing about it, did not know why they were talking about it and said she was perfectly happy with her pay and job. She looked a bit panicked and I felt bad for her and for even bringing it up. This is my point in my last post – the unions are fighting for WHOM exactly? Or are they pitching a last ditched effort to hold onto control of the grocery workers since they failed the workers miserably last time.

  4. Get A New Job
    July 6, 2007 at 8:10 am

    Grocery store workers need to get a reality check. No one else in the world can strike against their employer. If I don’t like my salary, then I get a new job or change careers. Furthermore, I depend on grocery stores to sell my local product (small business) so a strike would devastate my business. Stop being so greedy and get a new job if you don’t like yours. There are plenty of people out there to take your job – perhaps we can employ the homeless in your place. Two strikes in 4 years is too much. You will not have my support and I will continue to shop in Vons, Albertson and Ralphs.

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