Four and a half months after their labor contract expired, union representatives for workers at Albertsons, Vons, Pavilions, Safeway and Ralphs grocery stores say little progress has been made in forging a new agreement.
If the two sides fail to ink a new contract it sets the stage for another grocery strike, according to the United Food and Commercial Workers, Local 770.
“We don’t want a strike and we’re making every effort to prevent it,” union President Rick Icaza said Monday. “There’s a lot at stake here.”
The supermarket chains have been dragging out the negotiations since March, Icaza said, adding that it’s clear they’re delaying a settlement to avoid paying the increases employees deserve.
Icaza said the union is doing everything possible to avoid a strike, including putting pressure on the companies through actions at the stores and through community and labor delegations.
“We are going into stores and having people sign petitions to urge the companies to bargain in good faith,” he said. “At this point it’s not a boycott but we’re communicating with politicians and other labor unions and advising customers as to what this is about.”
The grocery workers’ labor contract expired March 6 and the current offer proposed by Ralphs and Albertsons — which also owns Vons, Pavilions and Safeway stores — is inadequate, union officials say.
The offer, they said, includes an “insulting wage proposal,” “devastating cuts” to their pension plan and a refusal to increase funding to the workers’ health plan.
An estimated 50,000 UFCW members voted last month to authorize a strike against the supermarket companies.
The two sides met on July 13, 14 and 15 with “little movement by the companies on any of the most important economic issues,” an update on the UFCW website said. Additional meetings are scheduled for Wednesday and Thursday of this week and for Aug. 1 and 2.
UFCW representatives have set Aug. 8 as the deadline for reaching an agreement.
If the grocers fail to show a willingness to adequately address the issues, the union said it will begin strike preparations. That will include holding picket captain meetings, shoring up its food banks, seeking hardship contributions from unions throughout the country and notifying the public of the likelihood of a strike.
Icaza is particularly rankled by the slow-moving pay increases the company has proposed.
Under the current offer, someone would have to work eight years at one of the supermarkets to achieve the top journeyman clerk pay of around $20 an hour, Icaza said.
“You could become a surgeon in less time than that,” he said. “They’re trying to offset the impacts from minium wage increases by reducing benefits. They don’t want to expand the health plan beyond what they are paying now and the pension plan doesn’t have adequate funding.”
Ralphs spokeswoman Kendra Doyel said her company is already paying entry level workers $10.50 an hour, more than the state’s current minimum wage of $10 per hour.
“We are committed to reaching an agreement at the bargaining table,” she said. “Discussions are ongoing and no one wants another strike. We will make sure we stay at the table and get another deal done.”
Burt P. Flickinger III, managing director for the retail consulting firm Strategic Resource Group, said the grocery chains are facing a dilemma as many of the investments in their employee pension plans have eroded in value.
“The Fed has driven interest rates down to levels that haven’t been seen in close to 50 years,” he said. “That has a negative implication for both the current return on assets in pension plans and on future returns. It’s become a non-stop moving target in how to balance the returns on pension plans with wages.”
Carlos Illingworth, a spokesman for Albertsons, Vons and Pavilions, released a company statement late Monday regarding the labor negotiations.
“During these negotiations we are dealing with several different complex legal and contractual issues,” he said. “We will work through these issues as we continue to negotiate an agreement that is fair to our employees, good for our customers and allows our company to remain competitive.”
One thing is certain — if another grocery strike occurs it will further splinter an already fragmented industry.
Southern California’s last grocery strike in late 2003 and early 2004 lasted 141 days and cost the industry nearly $2 billion, Icaza said.
“It was outrageous,” he said. “We not only lost money, we also lost market share. Back then all of those supermarkets had about 70 percent of the market share. Today that’s down to about 35 percent. A high percentage of shoppers ended up going to Trader Joe’s, Bristol Farms, Whole Foods and places like Stater Bros.”
