STRIKE: 70,000 to picket at California Grocers

Union strike causes 70,000 to picket at nation's major grocers

by Freddie Mooche - senior financial columnist

October 12, 2003 (Axcess News) Los Angeles - United Food and Commercial Workers Union, an AFL-CIO affiliate, went on strike at Vons in California today.

Grocery chains Safeway (NYSE: SWY), Krogers (NYSE: KR) and Albertsons (NYSE: ABS) union workers joined Safeway's strike in full support of Vons attempts to change their workers health insurance plan (Vons is a Safeway grocery chain).

The Union's contract with the areas three dominant supermarket chains expired October 5th. The strike Sunday affected thousands members across Southern California of the United Food and Commercial Workers Union , or UFCW, which totals 1.4 million members.

No word as to the rest of the nation's Union members intention to join the strike had been indicated by Sunday evening. The Union's website shows comments on the strike and suggests that it could spread to other regions of the country. If Union members nationwide join the picket lines the Nation's food supply could be affected and panic consumers.

The UFCW stated that the three grocery chains are trying to shift hundreds of millions of dollars in health-care costs to workers through higher insurance co-payments and caps that would sharply limit reimbursement for surgery and other expensive treatment.


The move by the grocers was a similar program Wal-Mart (NYSE: WMT) had forced on employees who not protected by a Union.

The UFCW in a recent press release stated that ["Over the past several days, Southern California supermarket workers have been voting on a contract offer from three of the largest supermarket operators in the country.


They have been confronted with a stark choice - give up health care benefits not for only themselves and their families - but, to sacrifice future generations of supermarket workers.


In unprecedented numbers, Southern California supermarket workers turned out to vote and sent a clear message - they will fight for affordable health care.


They delivered a mandate to their union - if needed to save health care - strike to protect our families - strike to save health care coverage for the next generation of workers."]


Safeway Corporate released a low key announcement regarding the UFCW's breakdown of contract negotiations. The grocer stated that "Representatives from Albertsons, Ralphs and Vons said they had been negotiating in good faith for several weeks in an effort to reach an agreement."

The skyrocketing cost of health care and pension benefits had been key issues throughout the negotiations.

"As responsible companies, we are seeking nothing more than a fair contract that will help us to remain competitive in the face of soaring health care and benefit costs and increased competition from lower-cost operators," said John Burgon, Ralphs president.

"In light of the current competitive environment our proposals are generous and will continue to provide wages and benefits for our existing associates that are among the best in our industry," said Albertsons Southern California Division President Dave Simonson.

Vons President, Tom Keller said, "We are seeing a significant influx of nonunion, discount stores and unionized independent operators with union contract agreements that provide lower wages and significantly fewer benefits than we provide. These formats pay much lower labor expense than we do. This gives them an unfair advantage over other union operators."

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