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DENVER - Unionized grocery workers and three food retailers -- King Soopers, Safeway, and Albertsons -- have agreed to extend their contract negotiations until Oct. 16, according to the U.S. Federal Mediation and Conciliation Service (FMCS), which brokered the agreement.
The extension, which was approved by the chains and formally ratified by employees Friday and Saturday, delays a possible strike that the grocers and their competitors in the area had been preparing for. Workers also voted on the most recent contract offer, which they overwhelmingly rejected. The original contract between the employees and King Soopers, Safeway, and Albertsons was scheduled to expire at 11:59 p.m. Saturday.
The agreement was reached late Thursday after the FMCS held intensive negotiations with both sides in the dispute. The three grocers are engaged in coordinated bargaining with the union, which represents 17,300 employees represented by United Food Commercial Workers Local 7 in Colorado Springs and Denver. Each company has to negotiate a separate contract with its workers, but the contracts to date have been virtually identical.
Union spokesman Dave Minshall told Progressive Grocer that "the workers think the extension will give the companies time to come to their senses" and provide "reasonable health care and a living wage." Calls to the retailers involved were not returned.
FMCS western regional director Scot Beckenbaugh, who is personally mediating negotiations between union representatives and the three supermarket chains, said that the agreement includes a "cooling-off period" this week, during which no talks are scheduled to take place.
Beckenbaugh added that the parties will exchange benefits cost information this week so that they understand more clearly where they disagree. Both sides have agreed to resume face-to-face discussions after this week's exchange of information. Under the request to talk beyond the contracts' expiration dates, the parties agreed to a timetable by which they can end or further extend the talks, if needed.
King Soopers, Safeway, and Albertsons say they have to keep labor costs low to stay competitive with supercenters like those run by Wal-Mart Inc., as well as natural foods grocery stores.
Last week Albertsons employees voted to reject the company's wage and health care proposals, which included a two-tier pay system that provides a lower wage scale for new hires, and employee contributions of $5 to $15 a week toward health care premiums. Safeway and King Soopers workers have rejected similar proposals.
In other labor news, Pleasanton, Calif.-based Safeway said that it was working hard to avert a strike in Northern California. "We are going to come in with the kitchen sink to try to figure out a way we can have a peaceful resolution here," said Larree Renda, a Safeway e.v.p., late last week. Safeway, Albertsons, and Kroger are currently negotiating contracts for approximately 35,000 workers at 532 stores in the region.
During what she referred to as an "unprecedented" conference call held the day the supermarket chain began contract negotiations with unionized workers in the San Francisco Bay area, Renda said that competition from Wal-Mart is far greater than Safeway previously believed. While Wal-Mart said it has plans to construct 40 supercenters in California, Safeway said the real number tops 100. Wal-Mart has disputed Safeway's figures.
Renda said such a conference call was necessary to counter "threats and ultimatums" by UFCW locals in the Bay area. For example, Bay Area locals have already requested that customers boycott the supermarket companies if they push for large reductions in health benefits.
As in Colorado, Safeway wants to implement a two-tier wage structure in Northern California. Sacramento and Bay Area union officials have said they'll fight against such a system.