I Can Go Back To Albertson's

Looks like Southern California grocery workers got a better contract without striking than they ended up getting after the ugly 2004 strike. Details to come, but this is the email from the UFCW:

Today, Southern California's grocery workers agreed to a tentative contract with the management of Ralphs, Vons and Albertsons. This is a fair contract that obtains our primary goals of wage increases for everyone while protecting health care coverage.

This is not just a victory for grocery workers, this is a victory for all of us. You stood with grocery workers in support of strong, middle class jobs that strengthen our communities, and while it certainly took longer than we hoped, in the end we got a contract without having to go on strike.

Three years ago, Southern California's grocery workers were forced to accept an unfair contract. Today, thanks to your support, we negotiated a fair contract on our terms.

This took seven long months of negotiations, but it looks like grocery workers will have their first raise in five years. Good work by the UFCW for standing strong and not backing down.

SoCal Grocery Update: Divide and Conquer

When a tentative agreement on health care benefits was reported a couple weeks back, it looked as if a Southern California grocery strike along the lines of the crippling 6-month strike back in 2003-04 would be averted. But the latest shenanigans by Ralph's and Vons and Albertson's have forced the UFCW to set a June 21 deadline for a comprehensive offer they can bring to their workers, or else they will vote on a walkout.

Here's what the chains did. The major goal of the negotiations on the labor side has been to eliminate the two-tier wage system for employees. Under the current contract, workers hired before 2004 make more (and receive more benefits) than workers hired after 2004, even if they do exactly the same job. This has given the chains an incentive to turn over their workers in favor of lower-paid new hires, and sure enough, over half of all current employees are in the lower tier.

This "divide and conquer" strategy worked so well last time that the chains are trying it again. From an email to supporters:

...we were shocked when the employers finally put the following wage proposal on the table: NO pay increases for anyone, and THREE wage tiers.

That's right. Despite the negative impact the two-tier system has had on grocery workers and their families -- not to mention the moral implications of creating inferior classes of workers -- Ralphs, Vons and Albertsons' contract negotiators proposed slashing wages even further with an additional third tier.

So if the employers have their way, grocery workers would be divided into the following three tiers:

One for employees hired before March 2004.

Another for employees hired after March 2004 but before the coming 2007 contract.

And yet another for everyone hired after the new contract.

And each one pays less than the one before.

These negotiations have gone on for six months, and now the chains are attempted to cut their wage outlays even FURTHER by adding a third tier. This is absolutely unacceptable, yet the union, reeling from the unsuccessful 2003-04 strike, has little room to maneuver. Only through collective action, and punishing these chains economically for their attempts to disrespect their employees, can there ever be any success. And that includes not only refusing to shop at their stores; after all, most Southern Californians stayed away the last strike. I'm talking about stock divestment, solidarity with other labor groups (like those who supply the stores through trucking) and any other means to ensure that the suits, who have the upper hand because of their size and flexibility, are permanently impacted.

Grocery Workers Contract Update

Just in from the UFCW:

Last Wednesday, in the middle of negotiations and with no notice whatsoever to our union negotiators, Ralphs, Albertsons and Vons announced to the press their intention to punish their workers and customers by locking out all of their employees if a limited strike is called against any of the markets.

Despite this needless provocation and attempt to intimidate us, we are still committed to working out our differences and getting an agreement at the bargaining table. That is why we agreed to resume negotiations with the employers after a cooling-off period suggested by the federal mediator.

Ultimately, we consider the employers' threats and intimidation a sign of desperation. They know that public opinion and momentum are on our side, and this latest move is simply a heavy-handed attempt to shift blame.

The chains used the same tactic of locking out employees during the last strike. Pretty interesting that they appear to understand the concept of strength through unity, no? But even more interesting is how the UFCW is counteracting this:

The Markets: "Ralphs, Vons and Albertsons are each negotiating individual contracts with each of the seven UFCW locals -- a total of 21 separate contracts."

The Truth: UFCW is negotiating with each of the markets separately to prevent them from forming potentially illegal “mutual aid pacts” like they did in 2003, a scheme still under investigation by the California Attorney General. The claimed 21 separate meetings are unnecessary and the markets demanded this as a delaying tactic. Stater Bros. and Gelsons negotiated fair contracts with UFCW without meeting each local separately, and if they could do it, so can Albertsons, Vons and Ralphs.

We know that April 9 is the day that the contract extension runs out. We'll have to wait and see what transpires in this weekend's contract talks before we know if there will be another strike.

Getting Screwed in the Bush Economy

The average worker has been getting screwed in the Bush economy since its inception, and now we have proof of this in action. As GDP has risen, the media wage (the wage in which half of the workforce is above it and half below) has remained flat or even shrunk. And workers aren't stupid, they recognize this:

A business coalition hired pollster David Winston to figure out why voters remained so dissatisfied with the economy. His focus groups of middle-income voters in Cincinnati and Pittsburgh found voters going deeper into debt to keep up with rising costs of health care and energy. Executive compensation "is getting to the point where it's obscene," said one focus-group participant.

The more politicians talked about how good the economy was, the worse these voters felt. "It's almost as if these folks are floating around in the ocean, watching the yachts and speedboats go by, thinking, 'Hey, I'm here, someone notice me,'" says Dirk Van Dongen, a co-chairman of the coalition and president of the National Association of Wholesaler-Distributors. Mr. Winston advised Republicans: "Our message should be that while the economy is getting back on track, we need to do more to help people with the cost of living."

There's an aspirational class that believes they will be on the yachts and speedboats someday soon. But there's also a far bigger middle class that has been fundamentally stepped on since 2001, and they cannot be mollified anymore. The Circuit City story is a perfect example of how workers have been disrespected in the current economy.

Circuit City Stores Inc. has a message for some of its best-paid employees: Work for less or work somewhere else.

The electronics retailer on Wednesday laid off 3,400 people who earned "well above" the local market rate for the sort of jobs they held at its stores.

In 11 weeks they'll be able to apply for their old positions — which will come with lower hourly wages.

The move put Richmond, Va.-based Circuit City, which has more than 40,000 employees in the United States, at the forefront of a new way of controlling labor costs in the service industry. Employers determine the prevailing market wages for particular jobs in various geographic regions and then find ways to make sure that their workers' salaries stay within that range.

That is a description of a race to the bottom, and it's actually anti-capitalist. You have a the biggest employers in the service sector (typically big-box stores) artificially setting wages based on one another and calling that "the market," when it's in the self-interest of all the respective management to lower those wages. One sign at a burger joint notwithstanding (yes, Mickey Kaus is that stupid that he believes one sign advertising jobs at In n Out for $9.50/hour, when they've always been a good employer anyway, means the economy is robust and strong), this is collusion. and it's going on across the service sector. Look at this looming Southern California grocery strike, where even with union backing, employees have had to endure anti-worker practices. Management across the board is dedicated to spending obscene amounts to ensure that the people they hire have no leverage, no bargaining power, that they do what their told and go home hungry if they must.

The Bush Administration thinks this is a PR problem, and so they make cosmetic trade policy shifts like putting tariffs on glossy paper coming out of China (how about a tariff on wheat gluten that kills pets?). It's too little and too late. They're making sops to a nonexistent manufacturing sector, while still vowing to veto the Employee Free Choice Act, which would give a fair shake to collective bargaining. They have a choice to make; continue to anger the largest group in the population, who sees through the "family values" mirage more and more as their families and their work are devalued, or do the right thing. I expect the former.

Grocery Dispute Update

Albertson's workers authorized a strike if no contract resolution is reached by April 9. This is designed to put pressure on management to get them back to the bargaining table. There's more at the UFCW's Respect Workers site.

I won't be going to a Safeway, Albertson's, Vons or Ralph's until they set this straight. The big chains are raking in record profits and while nobody wants to deny their ability to do so, the least they can do is respect their employees by allowing them to make a decent living with this one job. They can easily afford it.

The real problem with modern economic theory is that making outrageous profits is not enough to shareholders if they're the same amount of outrageous profits year-over-year. The principle of greed has overtaken all reason when it comes to this, and it's the workers who end up getting screwed. I'm not spending two seconds in a grocery store which has contempt for their staff.

UPDATE on the UFCW Grocery Worker's Bargaining

The UFCW is still trying to hammer out a contract with the major grocery chains (Safeway/Vons, Kroger/Ralph's, Albertson's/Supervalu), and both sides agreed to a three-week extension. The new deadline is April 9. 'Til then, support your local Gelson's and Stater Bros.

Buying Groceries Is A Political Act

The 2003-2004 Southern California UFCW grocery worker's strike and lockout was a low point in the history of the labor movement in America. Grocery employees picketed the three major chain stores for 140 days, and despite public support, in the end they got almost nothing that they wanted, were forced to take on a burdensome two-tiered wage system (one for new employees and one for old ones), and scarcely impacted the bottom line of these huge conglomerates, who consequently turned the grocery worker job from a stable middle-class profession to the equivalent of flipping burgers. It was disgraceful and deeply troubling that the lives of tens of thousands of workers in California were turned upside down.

Now there's a chance to rectify it. And you can help.

First, a little history. In October of 2003, members of the United Food and Commercial Workers (UFCW) voted to strike at Von's, a major Southern California supermarket chain owned by Safeway, Inc. The other two big chains, Albertson's (aka Supervalu) and Ralph's (aka Kroger) locked out their workers within hours. It was an example of the collusion by the big chains that characterized the whole strike.

The main issue was the health benefits of the workers, paid entirely by the company; Von’s wanted the workers to pay 50% of health costs under a new contract. They also wanted to introduce a two-tier wage system... Beginning in early October, 70,000 members of the UFCW were on strike in the region.

Since the U.S. has no national health care system, health benefits are often one of the most important parts of employee compensation. The average wage of a southern California UFCW worker is less than $12 per hour, and most workers are guaranteed only 24 hours of work per week. Many workers hold the job mainly for the health benefits.

I remember most the expressions of public support during the strike and lockout. The chain stores were almost completely empty. Trader Joe's was a mob scene, walking in there was like walking into some postwar zone. The shelves were ransacked, people were breaking open boxes faster than the stockboys could take everything out. Indigenous people were selling crafts in the aisles, an attempted coup broke out in produce, people were spray-painting “Viva La Revolucion” on the organic broccoli. (OK, the rest of that didn't happen.)

The point was that Southern Californians were by and large not crossing the picket line and respecting the right of the workers to bargain for fair wages. This is especially salient because the employees were mostly bargaining for future workers, so that they could get better pay and benefits. I remember dressing my dog up for Halloween as a striking grocery worker (and if the picture was on this computer, you'd be seeing it right now). People really understood the issue and went out of their way to honor the strike. Supermarkets lost roughly $2.5 billion in revenue.

And that's when the chains started to play dirty.

On October 31, they pulled the pickets from Ralphs as a gesture of “good faith” to focus them on Von’s; the employers immediately announced that they would be sharing profits and losses during the strike – thus showing at least that the capitalists have class solidarity. The union went so far as to urge people to shop at Ralphs, where their own members were locked out. Even though the chains are all national, with total sales of $30 billion a year, the unions shyed away from any national strategy, sending a few “informational pickets” to outlets in northern California and elsewhere.

This ended up being a bad strategy because Ralph's traffic picked up and then they SHARED THE PROFITS with the other two chain stores, keeping all three afloat and able to sustain the revenue loss. Furthermore, Ralph's started illegally rehiring union workers under phony Social Security numbers to keep the business going. The company eventually had to pay a SEVENTY MILLION DOLLAR FINE for "conspiracy, using a false Social Security number, identity fraud, falsifying information sent to the SSA and IRS, and failing to make proper payments to employee welfare benefits plans." Criminal charges for the executives are still pending.

The strike wore on and finally was settled in February 2004, as public support waned and the union ran out of money for strike pay. It was a combination of factors that led to the awful contract they were forced to accept. They instituted a two-tiered system that offers lower pay and benefits to new workers coming into the system. And the health care benefits that the old workers retained were trimmed, which led to increased turnover in the business. This blog post offers a great summation of why this strike just didn't work as well as it could have.

A generation ago, this strike would have been a complete victory for the employees. They were able to close down their stores for several months. When those stores were regional, the employers would not have been able to sustain those kind of losses.

But the grocery industry is increasingly a national and multinational industry. The companies decided it was worth taking huge losses in one regional market if they were able to break the back of the union.

In fact, it's paid off handsomely.

The chain stores' main complaint was that Wal-Mart and other discounters were moving into the region, and they could not compete with stores that offer no benefits. Three years later, Wal-Mart and other non-union grocery stores are not a factor in the Southern California market at all.

The employers always point to Wal-Mart and Costco as major reasons they need to cut costs (and pay their grocery workers less), but Wal-Mart and Costco control less than 8% of the Southern California market, even less than they had in 2003 when the employers claimed that this competition was forcing them to reduce wages and benefits for their grocery workers.

Indeed, the three major chains have retained all of the market share they lost during the strike and then some, propelling them to record profits. Ralph's, Von's and Albertson's and their parent companies made between 2 and 3 billion dollars in profits last year. Their CEOs took home up to $9 million in compensation.

Meanwhile, under this two-tiered system, nearly half of all grocery workers at these three chains are making less than the people who work right next to them doing the same job every day. And practically nobody is receiving quality benefits. Rick Wartzman spelled it out in an article in the LA Times:

The reason: These are folks who joined the Pleasanton, Calif.-based supermarket giant after the 4 1/2 -month strike and lockout that ended in February 2004. And under the contract the United Food and Commercial Workers union signed with Safeway, Kroger Co.'s Ralphs chain and Albertsons (now owned by Supervalu Inc.), new employees can't get any health benefits for 12 to 18 months. Their families aren't eligible to be covered for 30 months.

Going without insurance for so long "is completely stressful," says Suzanne Demers, who went to work at Safeway's Vons market in Redondo Beach in July 2004 and earns $10.50 an hour training others, filling in at the Starbucks station and tackling a range of additional tasks. "You just hope and pray that you don't get sick." [...]

Right now, figures from the trust fund overseeing the health plan show that a mere fraction of lower-tier workers have been in the job long enough to qualify for coverage: just 3,312 out of 12,520 at Vons; 3,771 out of 11,474 at Albertsons; and 2,044 out of 8,438 at Ralphs.

And how long will most of these workers last before they, too, head for the exits?

This two-tiered system is churning employees of what used to be a potential career out of the business; it's become a low-wage service job. And it's getting worse with every upper-tier employee that leaves and every lower-tier employee that replaces them.

The last contract for UFCW employees in SoCal expired a week ago; they granted a two-week extension and negotiations continue. Stater Bros. and Gelson's, two regional chains in the area, have agreed to remove the two-tiered structure. But the big stores (the ones that can afford it) have not budged yet. In the meantime, there's a lot you can do to help.

The UFCW has a website at RespectWorkers.com. There's a petition over there that I ask all of you to sign.

By signing this petition, you are indicating your support for compensating grocery workers fairly, ensuring that they enjoy a share of the supermarkets' billions in profits, and ending the current two-tiered wage structure by endorsing equal treatment for equal work.

Full Petition Text:

I believe Southern California's grocery workers deserve respect, and I therefore stand with them in support of the following contract goals:

--Fair benefits and pensions for all employees

--Equal treatment for equal work

--Elimination of the two tier contract

Another way you can support the employees is by patronizing those stores which have stepped up to their responsibilities. There is a worker-friendly store finder on their site which you can use to find the stores in Southern California which have shown respect for their employees. If you're not in the area, I would suggest that Safeway/Von's, Albertson's/Supervalu, or Kroger/Ralph's are NOT stores that you need to reward with your business at this time, until this gets ironed out. This can only work as a national strategy, in my view, because a national corporation can sustain a regional strike, as they did the last time.

I would also suggest that any Democratic candidate looking to make some headway in California would do well to highlight this issue RIGHT NOW and make sure that these large grocery chains are being held to account.

Nobody wants another strike. But there is an opportunity to rectify the deep injustice to working people that was perpetrated in 2004, and to ensure basic fairness in the workplace. I hope all of you can help with this project.