2003-11-10 -- Grocery Workers Struggle against Health Cuts and
Two-Tier Expands

I was in Los Angeles this weekend at the California Alliance for
Retired Americans founding convention, and there was an Albertson's
with picket lines a block away.  There was a great deal of support
from people driving by, as workers resist big cuts in health benefits
plus a much lower tier of wages and benefits for new employees. Very
few cars were in the parking lot.

I spoke with a grocery worker who had been sent by his union local
from St Paul, Minnesota to help with the picketing, on the basis that
whatever the grocery chains got away with in southern California would
be imposed in the middle West sooner rather than later.

The phenomenon where all companies try to match the wage-cutting and
service-cutting of the worst company (Wal-Mart, in this case) is often
described as "a race to the bottom."  Unfortunately, the phrase "race
to the bottom" implies that corporate greed motivates wage and benefit
cuts, rather than survival.  It is built into this system that no
matter how high a corporation's profits, it is in danger of being
swallowed up by any corporation with higher profits.

If the groceries succeed, people with responsible and productive jobs
will no longer have stable lives.  Instead, they will live a
hand-to-mouth existence like people in Barbara Ehrenreich's book
"Nickeled and Dimed."

A November 7, 2003 United Food and Commercial Workers (UFCW) press
release states in part, "Picket lines will go up at selected Northern
California Safeway stores in the next several days and will continue
indefinitely. UFCW members working in those stores will continue on
the job according to their contracts, but pickets will ask customers
to honor the line and to shop elsewhere. The Northern California
action is the first step in the nationalization of the supermarket
strike." The entire statement is at
http://www.ufcw.org/press_room/index.cfm?pressReleaseID=58




New York Times,  November 10, 2003


Two Sides Seem Entrenched in Supermarket Dispute
By STEVEN GREENHOUSE



LOS ANGELES, Nov. 8 - As 80 picketing workers bellowed chants outside
the supermarket Thursday evening, Rosalyn Colvard, a grocery stocker,
said she would need help from welfare to make ends meet if Southern
California's three largest grocery chains won their four-week-old
battle with 70,000 workers.

For the cashiers and stockers on the picket lines, the fight to fend
off large-scale concessions is a struggle to avoid being thrown into
one of America's lowest castes, the working poor. But for the
supermarkets, the confrontation, the biggest labor dispute in the
nation in recent years, is a painful investment to ensure that they
can survive against Wal-Mart and other low-cost rivals.

"The stakes are enormous," said Ruth Milkman, chairwoman of the
University of California Institute for Labor and Employment. "If the
employers succeed in their effort to extract large concessions, they
will turn these into low-wage jobs, and other employers across the
nation will see this as a green light to try to do the same thing."

The feuding sides appear to be dug in. On one side is the United Food
and Commercial Workers Union, which for over 60 years has obtained
such good wages and benefits that the region's supermarket workers can
lay claim to being part of the middle class, or at least the lower
rungs of the middle class. The workers' pay ranges from $7.40 an hour
for baggers with 30 months on the job to a $17.90 maximum for
cashiers.

"If we lose this fight, there go 70,000 jobs that will no longer be
middle-class jobs," said Connie Leyva, president of the food workers'
local in San Bernardino County. "It would have huge ramifications on
the economy of Southern California."

On the other side are the supermarket chains, led by Steven A. Burd,
chief executive of Safeway, a former management consultant who told
the workers that they had "Cadillac benefits" that were too generous
in this era of retail hypercompetition. Unlike most Americans, the
supermarket workers do not pay any premiums for health insurance.

"We view this as an investment in our future," Mr. Burd told Wall
Street analysts last month in a conference call. "And I'm confident
that my bargaining partners view it exactly the same."

Each side says the showdown, which involves a strike and a lockout,
has reached a critical stage, and each insists that the other is
suffering badly and may soon soften its position. The grocery chains
involved - Albertsons; Vons, owned by Safeway; and Ralphs, owned by
Kroger - lost more than $131 million in sales in each of the
showdown's first weeks, according to Merrill Lynch. And many workers
acknowledge that a month without regular paychecks hurts badly.

Millions of shoppers are unhappy, too. Across Southern California, 859
supermarkets are involved in the dispute, causing Californians to
debate whether to cross the picket lines as they weigh personal
convenience against support for the workers. During the stoppage, the
picketed stores have stayed open, but sales have dropped by
two-thirds, industry analysts estimate.

The two sides have not negotiated since Oct. 11, when workers at Vons
walked out, but the next day Albertsons and Ralphs struck back by
locking out their unionized workers to show solidarity with Vons. As
evidence that the dispute is taking its toll, the two sides agreed on
Friday to resume talks on Monday, joined by Peter J. Hurtgen, director
of the Federal Mediation and Conciliation Service.

On the picket line, workers often grow furious as they discuss the
concessions demanded by management: a two-year freeze on raises for
current workers, a requirement that workers pay $780 in annual
premiums for family health coverage, and a cap on annual employer
health contributions, which would most likely cause a decrease in
benefits.

"What gets me is they want to take away many of my medical benefits
and have me pay more for it," said Kelly Klinge, a $10.90-an-hour
merchandise clerk at a Vons.

Management wants to create a second tier of wages and benefits for new
employees. The proposed tier calls for paying new cashiers $10 an hour
after 30 months on the job, 44 percent lower than the $17.90 under the
old contract, union officials say. Newly hired cashiers would
eventually rise to $15.10 an hour, but only after eight years on the
job.

Ms. Colvard, the stocker, said management's demands to have workers
pay more for health insurance and to cut bonuses for working on
Sundays would leave her with too little money to support herself and
her two children. She said she was on welfare until 1996 when she took
a job with Albertsons, where she earns $12.17 an hour. Like most of
the supermarket workers, she is assigned just 24 to 32 hours a week,
making her annual pay around $18,000.

"Management's offer is fine if you live in less expensive states like
Florida or North Carolina, but it just won't cut it in California,"
she said. "If I have to start paying more for my health coverage, I
don't know how I'm going to afford rent and food and clothes for my
kids."

As she spoke, a striker behind her carried a sign reading, "Don't Let
Us Become Another Wal-Mart."

The three chains have said that they need concessions because mighty
Wal-Mart, the world's largest retailer, will soon open the first of 40
grocery-selling supercenters planned for Southern California over the
next five years. Wal-Mart's grocery workers average less than $9 an
hour.

"The supermarkets don't have a choice," said Lisa Cartwright, an
analyst with Citigroup Smith Barney. "They're losing market share to
alternative formats, whether it's Wal-Mart, Dollar Stores or wholesale
clubs. They are in a tough position, and they have to find ways to
compete more effectively."

She said the California battle "would set a trend for the supermarket
industry in other regions," especially if a new contract created a
lower second tier.

The workers dread a second tier. Under management's proposal for
workers at that level, the supermarkets would contribute $1.35 per
hour toward health coverage, coming to about $1,800 a year per worker,
enough to finance minimal coverage. That compares with the $5,000 that
the supermarkets contributed annually per worker under the old
contract.

"The new hires would have low pay, little in the way of medical
benefits, and no pension, so what kind of a future will they have?"
said Maria Solorzano, a cashier for 18 years. "We're out here
picketing to protect the people who come after us."

Many workers said that if management got its way, it would have huge
incentives to push out old employees to make way for lower paid new
workers. "The two-tier system means current employees will walk around
with a target on their head," said Mike Morales, a cashier in Pomona.

Mr. Burd told the Wall Street analysts that Safeway's health expenses
would increase by $130 million in three years if it did not address
health costs. He said that the strike's cost was "a very small number
compared to accepting business as usual."

Safeway officials would not make Mr. Burd or other officials available
for interviews. Spokesmen for Vons and Ralphs did not return phone
calls, and an Albertsons spokesman declined to comment.

To turn up the heat, the union has begun picketing and running
advertisements in Northern California urging consumers not to shop at
Safeway stores there.

Many shoppers have honored the picket lines out of loyalty to
cashiers, baggers and stockers and turned to Stater Brothers and other
supermarkets not involved in the dispute. But now customers are
complaining that lines at Stater Brothers have grown too long and its
parking lots too crowded.

On Oct. 31, the union pulled its pickets from Ralphs, giving shoppers
a green light to go there, saying that Ralphs had taken a less
hard-line stance than the other chains.

Slowly but surely, union leaders acknowledge, the number of shoppers
crossing the picket lines is growing.