Grocery Store Chains, Union Reach Tentative Deal

After 16 days of negotiations, grocery store chain executives and union leaders in Southern California on Thursday reached a tentative agreement that could end a nearly five-month-long strike and lockout that "highlighted the national debate over how much companies should pay for workers' health care coverage," the Los Angeles Times reports (Peltz et al., Los Angeles Times, 2/27). The dispute -- which involves 59,000 United Food and Commercial Workers union members from 852 Safeway-owned Vons and Pavillions, Kroger-owned Ralphs and Albertsons stores -- began on Oct. 11 when Vons and Pavillions employees refused a contract that would have capped health benefits for current employees and created a lower health benefits plan and wage tiers for new hires. Albertsons and Ralphs locked out their workers the next day in a show of solidarity with Safeway. According to the New York Times, the grocery store chains' leaders said that their employees had a "Cadillac health plan" that was untenable in a market with nonunion competitors, such as Wal-Mart, Costco and Trader Joe's. In combined wages and benefits, Wal-Mart workers earn between $8 and $12 less per hour than the unionized supermarket workers, grocery store chain leaders said (LeDuff/Greenhouse, New York Times, 2/27). Under the contract that expired in October, grocery store chain workers paid no health care premiums and had a $10 copayment for doctor visits and prescriptions (Raine, San Francisco Chronicle, 2/27). Details of the contract will not be released until union members vote on the contract Saturday and Sunday (AP/San Jose Mercury News, 2/27). However, officials familiar with the negotiations said the contract contains measures to:

• Require new hires to pay weekly health care premiums and place them in a lower wage tier;
  
  
• Allow the companies to freeze their contributions to health plans for current workers;
  
  
• Stop the grocery store chains from creating separate health and pension funds for new employees (New York Times, 2/27);
  
  
• Require the companies to add millions of dollars to the health care fund; and
  
  
• Prohibit the supermarkets from charging current employees for health care premiums for at least the first two years of the contract (Los Angeles Times, 2/27).
  

UFCW officials said in a statement that the deal "preserves affordable health care, maintains pensions and achieves job security." In a statement from the supermarkets, officials said "the tentative agreement squarely addresses the challenging health care costs and competitive issues we face" (AP/San Jose Mercury News, 2/27). The California Labor Federation and AFL-CIO said the dispute "gave a strong message to corporations: Any effort to dismantle affordable health care will faced determined opposition" (Los Angeles Times, 2/27).

NPR's "Morning Edition" on Friday reported on the tentative agreement between the grocery store chains and workers. The segment includes comments by Ruth Milkman, director of the University of California Institute for Labor and Employment and George Whalin, president and CEO of Retail Management Consultants (Kahn, "Morning Edition, 2/27). The complete segment is available online in RealPlayer. NPR's "All Things Considered" host Melissa Block on Thursday discussed the tentative agreement with NPR Correspondent Carrie Kahn (Block, "All Things Considered," NPR, 2/26). The complete segment is available online in RealPlayer.