Tesco Fresh & Easy Neighborhood Market CEO Tim Mason Gets Big Stock Award Featuring a Singular Twist

News & Analysis

Tesco plc director and Fresh & Easy Neighborhood Market USA CEO Tim Mason (pictured above) has been granted rights to 292,085 ordinary shares of United Kingdom-based Tesco plc stock under Tesco's executive incentive plan, for which no payment by the reciepient is required. It's essentially a stock grant.

The shares were awarded to Fresh & Easy CEO Mason yesterday as part of Tesco's 2009/10 fiscal year annual defered bonus for the company's top executives, who are also members of its board of directors.

The number of shares awarded to Mr. Mason was calculated using an average Tesco plc market price of 388.05 pence, according to Tesco plc's investor relations department.

In addition to Tim Mason's stock share grant of 292, 085 shares, Tesco plc CEO Terry Leahy received a bonus award of 459,644 shares.

The following other Tesco executives-directors received the stock awards yesterday:

>Commercial and Marketing Director Richard W Brasher, 196,696 shares
>International and IT Director, Incoming CEO, Philip A Clarke, 196,696 shares
>Chief of Retailing Services and Group Strategy Director Andrew T Higginson, 196,696 shares
>Retail and Logistics Director David T Potts, 196,696 shares
>Group Finance Director Laurie McIlwee, 147,522 shares
>Corporate and Legal Affairs Director Lucy Neville-Rolfe, 147,522 shares

In an interesting development, all of the directors except for Fresh & Easy Neighborhood Market CEO Tim Mason, received their share awards in the form of nil cost options (share options that can be exercised without payment of a subscription price; essentially a regular stock option). In contrast, Mason's 292,085 shares is in the form of an unfunded promise to deliver shares, which means, among other things, he can't exercise the options at any time, like the others can if they choose to.

For Tim Mason this basically means that unlike the other directors, who's shares will be increased to reflect the dividends that would have accrued on vested shares had they been reinvested in shares in the period between the stock grant and its exercise (the nil cost option), and can be exercised if desired, his award is what's called grant and vesting (an unfunded promise to deliver shares), which means the award will vest but Mason won't be able to exercise any of the 292,085 shares before May 22, 2013.

We suspect, among other considerations, the special handling of Tesco plc director and Fresh & Easy Neighborhood Market CEO Tim Mason's stock award might have something to do, but not exclusively by any means, with Tesco's being under attack by the CtW Investment Group, which invests money from labor union pension funds in various corporations, including Tesco plc. The group is arguing that Mason received excessive compensation for fiscal year 2009/10. [Read our June 4, 2010 story on his compensation package here: June 4, 2010 - Every Little (Bit) Helps: Tesco Fresh & Easy Neighborhood Market CEO Mason Paid $6.188 Million For 2009]

On June 17, 2010, CtW investment Group and the Change to Win coalition of labor unions, many of which have pension fund monies invested in Tesco, sent this letter to Tesco plc shareholders regarding Tim Mason's pay package. In the letter they urge Tesco shareholders to vote no on proxy Item #2, the Directors' Remuneration Report, at Tesco’s upcoming July 2 annual shareholder meeting in London, UK.

The group also distributed this press release about the letter and campaign to media outlets far and wide on June 17. The release has generated considerable press on the issue, focusing on Mason's 2009/10 pay package and the group's attempt to get Tesco plc shareholders to vote against it at the July 2, 2010 shareholders meeting.

Perhaps Tesco believes that granting Tim Mason's stock award on the unfunded promise basis, which means he can't exercise any of the shares until May 22, 2013, will help blunt some of this criticism, leading to a majority vote of Tesco shareholders in favor of the Directors' Remuneration Report at the July 2 shareholder meeting. Or perhaps, among other considerations, it's just good politics, considering Fresh & Easy's $253 million loss for fiscal year 2009/10? If shareholders were to vote the report down it would mean Tesco couldn't go forward with the pay packages, including the stock awards listed above, for the corporation's directors.

The objective reality is the probability of Ctw Investment Group and the labor union group getting a majority investor vote against the Directors Remuneration report is highly unlikely for a number of reasons, chief among those reasons being that the majority of Tesco investors with voting rights are the big, institutional investors. For example, U.S. billionaire Warren Buffett, who owns 3% (about $1.3 -to- $1.4 billion in value) of Tesco plc through his Berkshire Hathaway holding company and investment firm, won't likely vote against the report.

These big investors will likely vote for the package for two key reasons. First, Tesco plc had record profits in its 2009/10 fiscal year. Therefore the investors aren't going to let Tim Mason's pay package get in the way of affirming the report. Second, these institutional investors don't want to veto the report because doing so would lead to a drop in Tesco's stock share price, meaning their investments would drop in value.

Adding to this, voting against the report would likely lead to uncertainty in the market vis-a-vis Tesco plc, potentially leading to further reductions in the retailer's share price. This is the last thing these big, institutional investors want to happen.

The investor-types at CtW Investment Group are aware of this probability, as are the heads of the labor unions. Or they should be. Ctw has authored resolutions at previous Tesco annual meetings that were rejected by these same big, institutional investors, who've got the votes.

However, the unions see a secondary benefit to the "vote against the report" campaign, which is to increase the pressure on Tesco via investors and the public (via the media) in its efforts to organize and unionize Fresh & Easy Neighborhood Market's store-level employees, which the United Food & Commercial Workers (UFCW) union has been trying to do since the first Tesco-owned Fresh & Easy grocery stores opened in late 2007.

Tesco's annual shareholder meeting is just 10 days away. Therefore we'll see the results of this issue come to a head very soon, at least in terms of the shareholder vote - but certainly not in terms of the ongoing campaign to unionize Fresh & Easy workers.

Fresh & Easy Buzz Linkage: Related Stories:

June 4, 2010 - Every Little (Bit) Helps: Tesco Fresh & Easy Neighborhood Market CEO Mason Paid $6.188 Million For 2009

June 21, 2010: The Missing Link in Tesco's Purchase of Fresh & Easy Neighborhood Market Meat Supplier '2 Sisters Food Group'

June 20, 2010: NLRB Judge Rules Against Key Fresh & Easy Neighborhood Market Supplier '2 Sisters Food Group' in Labor Relations Violations Case

June 20, 2010: NLRB Judge Rules Against Fresh & Easy Neighborhood Market in Spring Valley CA Store Labor Law Violation Case

March 4, 2010 - Aministrative Law Judge Finds Tesco's Fresh & Easy Violated Labor Relations Act in Ex-Store Employee, UFCW Union Complaint

August 5, 2008: UNI Global Union Launches Tesco-Specific Alliance; Calls For Tesco Executives to Meet With UFCW Union Officials Over Fresh & Easy Neighborhood Market

June 26, 2008: Tesco 2008 AGM: Barack Obama Sends Second Letter to Tesco CEO Requesting the Company Meet With U.S. UFCW Union Leaders About Fresh & Easy

June 26, 2008: Tesco 2008 AGM: Charges of Tesco's Exploiting Workers at Indian Factory Heat Up On the Eve of Corporate Annual General Meeting

June 22, 2008: Vocal Cast of Critics and Advocacy Groups to Attend Tesco's Annual General Meeting On Friday, June 27

June 4, 2008: News and Analysis: UFCW Union Takes its Tesco Union Organizing Campaign Across the Pond to the United Kingdom Beginning Today

February 11, 2008: Supermarket Union President Asks Britain's Prince Andrew to Arrange A 'Sit-Down' With Tesco Fresh & Easy Neighborhood Market Senior Executives

Some additional links here.

[Photo credit: Fresh & Easy Neighborhood Market]

The Missing Link in Tesco's Purchase of Fresh & Easy Neighborhood Market Meat Supplier '2 Sisters Food Group'

Pictured above is (the artists rendering) the '2 Sisters Food Group' facility in Riverside County, California, which is located next to Tesco's Fresh & Easy Neighborhood Market distribution center. Dynamic Builders, the contractor for the 2 Sisters' building, set up a cellular-cam during construction. You can view a slide-show and a time-lapse video show of the construction of the facility here. It's worth a look.

Analysis/Commentary

Yesterday (June 20, 2010) Fresh & Easy Buzz broke the story that a National Labor Relations Board (NLRB) Administrative Law Judge, Lana H. Parke, on June 10 ruled against Fresh & Easy Neighborhood Market's fresh meat and prepared foods ingredient supplier, United Kingdom-based 2 Sisters Food Group, in an unfair labor practices case brought against it by the United Foods & Commercial Workers (UFCW) union.

[Read our story here: June 20, 2010 - NLRB Judge Rules Against Key Fresh & Easy Neighborhood Market Supplier '2 Sisters Food Group' in Labor Relations Violations Case.]

Fresh & Easy Buzz is the only publication to report on the judge's decision thus far, based on a search we just completed.

However, interestingly, today's Financial Times just happens to have a short story, "Tesco takes over Fresh & Easy suppliers," which features an interview with Tesco plc director and Fresh & Easy Neighborhood Market CEO Tim Mason, who hasn't spoken to the press in a rather long time, and who now is in the sites of The CtW Investment Group, which works with pension funds sponsored by the Change to Win coalition of U.S. labor unions, for the substantial pay package he recently received. See our June 4, 2010 story: Every Little (Bit) Helps: Tesco Fresh & Easy Neighborhood Market CEO Mason Paid $6.188 Million For 2009]

Last week, on June 17, CtW Investment Group sent this letter (and this press release to the media) to Tesco shareholders regarding what the group says is excessive remuneration for Mr. Mason. In the letter they urge Tesco shareholders to vote no on proxy Item #2, the Directors’ Remuneration Report, at Tesco’s upcoming July 2nd shareholder meeting in the UK.

In the story today (it's here), Tim Mason tells the Financial Times that Tesco is buying and taking over 2 Sisters Food Group and its other privately-owned in-house supplier, Wild Rocket Foods, which serves as Fresh & Easy Neighborhood Market's fresh produce procurement arm.

The story says: Tim Mason, the head of the Fresh & Easy business, told the Financial Times it was a sign of its commitment to the US business. While not large enough to require disclosure, he said the transaction involved “tens of millions of dollars” and “a real amount of money”.

If not large enough to require disclosure, Why did Mason disclose it at all. And why specifically disclose it today in the Financial Times, the day after our story on the NRLB decision against 2 Sisters Food group? There's no press release on the subject in the "newsroom" on the Fresh & Easy website, for example.

2 Sisters Food Group and Wild Rocket Foods are privately-owned companies. Tesco brought both firms to the U.S. to serve as its supply partners for Fresh & Easy. Both companies have facilities next door to Tesco's 850,000 square-foot Fresh & Easy Neighborhood Market distribution center in Riverside County, California. The impressive 2 Sisters Food Group facility is only a few years old and is about 53,000 square-feet. The facility was a substantial investment for the company.

In the story, Fresh & Easy CEO Mason also says: "The move (buying 2 Sisters Food Group and Wild Rocket Foods) would lead to 'synergies and economies by putting the management teams of the units together. . . we think will be very beneficial for the business." OK.

Mason is also attributed by the Financial Times' reporter as saying '2 Sisters Food Group and Wild Rocket Foods had not performed as well as their owners had hoped, as Fresh & Easy slowed its expansion plans.'

"Has Fresh & Easy gone more slowly than we initially planned and they initially planned? Well, yes. And that has obvious consequences," Fresh & Easy Neighborhood Market CEO Mason is quoted as saying in the story.

What isn't said in the Financial Times' story today of course is that both suppliers have been losing far more money as part of Tesco's U.S. venture that they had ever expected to. Both firms essentially wanted out of the deal - and it now appears they are.

Interestingly, the Financial Times story says nothing about the NLRB Administrative Law Judge's June 10 decision against 2 Sisters Food Group, which we reported yesterday.

The UFCW first filed an unfair labor practices complaint against 2 Sisters Food Group in 2008, as we reported here [August 27, 2008 we reported in this piece - UFCW Union Reports Tesco Fresh & Easy Neighborhood Market's Prepared Foods Supplier to Labor Board For What it Says is Unfair Firing of Six Employees] and in our story yesterday. Paying for nearly two years' of legal costs in fighting the charges, which resulted on June 10 in a victory for the UFCW union, has just added to 2 Sisters Food Group's expenses in California.

Unfortunately nothing Tim Mason says in the Financial Times story, in the couple sentences about sales, same-store-sales and the like, sheds any light on Fresh & Easy's performance. It's just a brief repetition of the generalized comments, void of any metrics, Tesco made when it reported its fiscal year 2009/10 sales and earnings in April.

We aren't surprised Tesco is buying its produce supplier Wild Rocket Foods. They signaled this in part when they transferred Tim Lee from UK corporate headquarters to Fresh & Easy USA, as its new director of fresh foods.

Tim Lee's specialty at Tesco's corporate headquarters in the UK, where he was a produce category procurement director, was fresh produce. There Lee and another Tesco produce category procurement director, Alex Dower, launched Tesco's global fresh produce sourcing buying and supply chain initiative in about mid-2009. The initiative focuses on direct procurement of fresh produce for Tesco stores in the UK and continental Europe. Lee's responsibilities included setting up satellite offices in growing and sourcing regions around the world and staffing the offices with technical specialists and produce buying teams.

Basically, what Tesco is doing with Wild Rocket Foods is buying it and folding it into its corporate procurement function, with a California Fresh & Easy twist, which Tim Lee was responsible for in the UK, and was sent to Fresh & Easy in part to do in some form.

Another signal Tesco was up to something with its produce procurement came when we learned - and reported here - June 9, 2010: Key 'Veteran' Fresh Produce Category Manager Chris Harris Leaves Fresh & Easy Neighborhood Market - that fresh produce category manager Chris Harris had left Fresh & Easy Neighborhood Market. Harris' departure now takes on a much brighter picture in light of Tesco's buying of Wild Rocket Foods, combined with the naming of Tim Lee as director of fresh foods a few months ago. (We commented in the piece linked above that Lee was making some changes to Fresh & Easy's produce procurement since coming on board. Check it out.)

In light of NLRB Administrative Law Judge Parke's June 10 ruling against 2 Sisters Food Group, we aren't surprised that Tesco is buying 2 Sisters' as well, although we didn't know it was until reading Mr. Mason's announcement today in the Financial Times, just a day after our story was published.

Buying 2 Sisters Food group and Wild Rocket Foods though is a complete 180 degree turn by Tesco. The key reason Tesco brought 2 Sisters Food Group and Wild Rocket Foods with it to America was so that it could outsource the labor intensive fresh meat and produce functions, thereby saving considerable labor costs.

As such, does it logically (and financially) follow that Tesco wants to buy the two companies, since doing so means adding hundreds (CEO Mason says 750 in the Financial Times story) of new employees to the Fresh & Easy Neighborhood Market payroll? Not on your life.

However, 2 Sisters is Tesco's primary fresh meat supplier in the UK. Additionally, Wild Rocket is owned by Tesco's leading fresh produce supplier in the UK, Langmead Farms. These relationships also help explain why Tesco would want to bailout the two companies by taking over their respective U.S. operations., even though the cost is in the "tens of millions," according to Tesco director and Fresh & Easy Neighborhood market CEO Mason.

We've been hearing from sources for some time that both 2 Sisters Food Group and Wild Rocket have been bleeding red ink, hoping for something to give, like an increase in sales volume at Fresh & Easy. It appears now both suppliers - what Tesco designed as it outsourcing hat trick fro Fresh & Easy - will bleed red ink no more in California, but rather take what they can get from Tesco and head back to the United Kingdom.

And since it's selling its U.S. operations to Tesco, 2 Sisters Food Group won't have to follow all those remedies the NRLB Administrative Law Judge laid out in her June 10 ruling. Tesco might have to though.

Related stories:

June 20, 2010: NLRB Judge Rules Against Key Fresh & Easy Neighborhood Market Supplier '2 Sisters Food Group' in Labor Relations Violations Case

June 20, 2010: NLRB Judge Rules Against Fresh & Easy Neighborhood Market in Spring Valley CA Store Labor Law Violation Case

June 12, 2010: Will Phil Clarke Shake Things up at Fresh & Easy Neighborhood Market USA When He Becomes Tesco CEO in 2011?

June 8, 2010: Tesco CEO Terry Leahy Retiring; Philip Clarke New CEO; Tim Mason Named Deputy CEO But Will Remain Fresh & Easy Neighborhood Market Chief in U.S.

June 4, 2010: Every Little (Bit) Helps: Tesco Fresh & Easy Neighborhood Market CEO Mason Paid $6.188 Million For 2009

NLRB Judge Rules Against Key Fresh & Easy Neighborhood Market Supplier '2 Sisters Food Group' in Labor Relations Violations Case

On August 27, 2008 we reported in this piece - UFCW Union Reports Tesco Fresh & Easy Neighborhood Market's Prepared Foods Supplier to Labor Board For What it Says is Unfair Firing of Six Employees - that the United Food & Commercial Workers (UFCW) union charged Tesco-owned Fresh & Easy Neighborhood Market's UK-headquartered fresh meat and fresh-prepared foods supplier 2 Sisters Food Group with unfair labor practices at its Riverside County, California plant, filing a complaint against it with the National Labor Relations Board (NLRB), for what the union said was the unfair firing of six employees for attending a union recruitment meeting, along with filing complaints against the workers' managers at the company.

UK-based Tesco brought 2 Sisters Food Group with it to the U.S. in 2007 to be its supplier of fresh meat and poultry and fresh-prepared foods. 2 Sisters is independently-owned and is not connected to Tesco corporately. However it serves as a quasi-in-house supplier to Fresh & Easy for the products in these two categories.

The UFCW began a campaign to unionize employees at the 2 Sisters Food Group plant in Riverside County in early 2008, just as it did with Fresh & Easy's store-level employees a couple months earlier

Nearly two years later (after the first of multiple complaints was filed as reported in our August story linked above), on June 10, 2010, a National Labor Relations Board (NLRB) Administrative Law Judge, Lana H. Parke, has reached a decision on the 2008 case, which was consolidated into a number of other complaints filed since then by the UFCW against 2 Sisters Food Group.

The consolidated complaint in the case, which was tried by Judge Parke on March 1-3 in Riverside County, California, where 2 Sisters Food Group is based near Fresh & Easy Neighborhood Market's distribution facility, and on March 1-3 and in Los Angeles, alleged that Fresh & Easy Neighborhood Market violated Sections 8(a)(3) and (1) of the National Labor Relations Act, according the the judge's ruling summary.

A key, but not sole, complaint in the case by the UFCW is that 2 Sisters Food Group interfered with a July 17, 2009 election by company employees, the positive results of which would have unionized the company. The union's chief goal in the case was to get the election, which the employees that favored unionization lost, set aside on the grounds the company's interference in it resulted in an unfair election.

Below are the three key UFCW complaints against 2 Sisters' in the case that Judge Parke ruled on, in favor of the UFCW and against 2 Sisters Food Group:

1. Did the Respondent (2 Sisters Food Group) violate Section 8(a)(1) of the Act by promulgating and maintaining overbroad rules, including solicitation and distribution rules and a rule waiving employees’ right to file charges with the Board, all of which has interfered with, restrained, and coerced employees in the exercise of their Section 7 rights?

2. Did the Respondent violate Sections 8(a)(3) and (1) of the Act by terminating employee Xonia Trespalacios on July 13, 2009? (this goes to the original complaint reported on in our August 2008 piece.)

3. Did the Respondent engage in conduct that affected the results of the representation election held July 17, 2009 so as to require the setting aside of the election?

In her June 10, 2010 ruling, Judge Parke ruled for the UFCW and against 2 Sisters Food Group on the union's key issue, that the election held on July 17, 2009 (number 3 above) be set aside and a new election held.

In her decision conclusion in favor of the UFCW, Judge Parke wrote: "In as much as I have recommended that Objections 4 and 37 be sustained, I recommend that the election held on July 17, 2009 in Case No. 21-RC-21137 be set aside and that the representation proceeding be remanded to the Regional Director of Region 21 for the purpose of conducting a second election."

The judge also ruled that 2 Sisters Food Group must post a "Notice of Second Election" in a place where all employees can see it on company premises. The heading of that notice reads:

"The election conducted on July 17, 2009 was set aside because the National Labor Relations Board found that certain conduct of the Employer interfered with the employees' exercise of a free and reasoned choice among employees in the following unit: All full-time and regular part-time production employees, maintenance employees, technical/quality assurance employees, sanitation employees, shipping and receiving employees and plant clerical employees employed by the Employer at its Riverside facility, excluding all other employees, temporary employees, office clerical employees, professional employees, guards and supervisors as defined in the Act. [You can view the notice here.]

In the firing of employee Xonia Trespalacios, Judge Parke's remedy is a strong one for the employee: "The Respondent (2 Sisters Food Group) having unlawfully terminated employee Xonia Trespalacios, it must offer her reinstatement and make her whole for any loss of earnings and other benefits. Backpay shall be computed on a quarterly basis from the dates of her discharge to the date of proper offer of reinstatement, less any net interim earnings, as prescribed in F. W. Woolworth Co., 90 NLRB 289 (1950), plus interest as computed in New Horizons for the Retarded, 283 NLRB 1173 (1987). The Respondent will be ordered to make appropriate emendations to Xonia Trespalacios’ personnel files. The Respondent will be ordered to post appropriate notices," the judge wrote.

Below are the recommended remedy's the Judge made in her ruling against 2 Sisters Food Group in the case:

Respondent, 2 Sisters Food Group, Inc., its officers, agents, successors, and assigns, shall

1. Cease and desist from:

(a) Promulgating and maintaining overbroad work rules and a mandatory arbitration rule that requires employees to waive their rights to file charges with the Board

(b) Terminating any employee for engaging in union activities and/or to discourage employees from engaging in union activities.

(c) In any like or related manner interfering with, restraining, or coercing employees in the exercise of the rights guaranteed them by Section 7 of the Act.

2. Take the following affirmative action necessary to effectuate the policies of the Act.

(a) Within 14 days from the date of this Order, offer employee Xonia Trespalacios full reinstatement to her former jobs or, if that job no longer exists, to substantially equivalent positions, without prejudice to her seniority or any other rights or privileges previously enjoyed

(b) Make employee Xonia Trespalacios whole for any loss of earnings and other benefits suffered as a result of the discrimination against her, in the manner set forth in the remedy section of the decision.

(c) Within 14 days from the date of this Order, remove from its files any reference to the unlawful termination of Xonia Trespalacios and within 3 days thereafter notify her in writing that this has been done and that the termination will not be used against her in any way.

(d) Preserve and, within 14 days of a request, or such additional time as the Regional Director may allow for good cause shown, provide at a reasonable place designated by the Board or its agents, all payroll records, social security payment records, time cards, personnel records and reports, and all other records, including an electronic copy of such records if stored in electronic form, necessary to analyze the amount of back pay due under the terms of this Order.

(e) Within 14 days after service by the Region, post at its facilities in Riverside, California copies of the attached notice marked “Appendix.”[23] Copies of the notice, on forms provided by the Regional Director for Region 21 after being signed by the Respondent's authorized representative, shall be posted by the Respondent immediately upon receipt and maintained for 60 consecutive days in conspicuous places including all places where notices to employees are customarily posted. Reasonable steps shall be taken by the Respondent to ensure that the notices are not altered, defaced, or covered by any other material. In the event that, during the pendency of these proceedings, the Respondent has gone out of business or closed the facility involved in these proceedings, the Respondent shall duplicate and mail, at its own expense, a copy of the notice to all current employees and former employees employed by Respondent at any time since July 13, 2009.

(f) Within 21 days after service by the Region, file with the Regional Director a sworn certification of a responsible official on a form provided by the Region attesting to the steps that Respondent has taken to comply.

[We suggest you read Judge Parke's full written ruling here. It offers numerous details of the case, as well as a summary of the issues in the case involving employees and their supervisors at the 2 Sisters Food Group facility in Riverside County, California.]

Judge Parke's June 10, 2010 ruling and order is pending. It must be approved by the NRLB.

2 Sisters Food Group has the right to appeal the Administrative Law Judge's ruling should it be approved by the NRLB, which most-likely it will per the agency's normal procedure following a judge's ruling.

The NLRB Administrative Law Judge's ruling is a clear victory in this instance for the union. The key finding from the UFCW's standpoint in terms of being able to unionize 2 Sisters Food Group's Riverside County facility is the provision that a new employee election must be held.

Related story - June 20, 2010: NLRB Judge Rules Against Fresh & Easy Neighborhood Market in Spring Valley CA Store Labor Law Violation Case.

NLRB Judge Rules Against Fresh & Easy Neighborhood Market in Spring Valley CA Store Labor Law Violation Case

For the second time so far this year a National Labor Relations Board (NLRB) Administrative Law Judge has ruled against Tesco's Fresh & Easy Neighborhood Market in a case filed against the grocery chain by the United Food & Commercial Workers (UFCW) union involving a pro-union employee of a Fresh & Easy grocery store.

The Administrative Law Judge is William G. Kocol. The case, which involves employee-management unionization and related issues at a Fresh & Easy store in Spring Valley, California near San Diego, was tried in San Diego on March 23, 2010. Judge Kocol ruled on the case on June 3, 2010.

Tesco's Fresh & Easy Neighborhood Market is a non-union food and grocery retailer. The UFCW union has been organizing the grocery chain's store-level employees since the first Fresh & Easy stores opened in November 2007.

[Read about the first case, which involved a Fresh & Easy store in Las Vegas, Nevada, here: March 4, 2010 - Aministrative Law Judge Finds Tesco's Fresh & Easy Violated Labor Relations Act in Ex-Store Employee, UFCW Union Complaint]

The case the judge decided June 3, 2010 was the result of an unfair labor practices complaint, which was originally filed by the UFCW's Western Region 8 against Tesco's Fresh & Easy on June 12, 2009 and consolidated and amended on January 11, 2010, that alleged Fresh & Easy Neighborhood Market, Inc. violated Section 8(a)(1) of the National Labor Relations Act by orally promulgating a rule that prohibited employees from talking about the union (UFCW) while on the clock or while on the sales floor and orally promulgating another rule that prohibited employees from discussing discipline with other employees while working on the sales floor.

The complaint also alleges that Fresh & Easy violated that same section of the Act by impliedly threatening an employee engaged in union or protected concerted activity.

That employee is Shannon Hardin, who has worked at the Fresh & Easy store at 9665 Campo Road in Spring Valley, California since January 2008. Spring Valley is about 11 miles east of San Diego. All of the activities detailed in the case occurred at the Spring Valley store.

Hardin is a supporter of unionization at non-union Tesco's Fresh & Easy Neighborhood Market.

The case centers around three key areas:

>Shannon Hardin's discussing the UFCW union and unionization at the store with fellow employees;

>Hardin's talking with co-workers about some disciplinary actions she received from the store's team leader (assistant manager), Sylvia Soliz, who is no longer employed by Tesco's Fresh & Easy Neighborhood Market, and the store's manager, James Tillinghast, who is now the manager of a different Fresh & Easy grocery store and;

>an "invitation" extended by team leader Soliz to Hardin to quite her job if she wasn't happy working at the Spring Valley, California Fresh & Easy store or for the company.

Hardin's discussion of the union with fellow employees led to a series of meetings with store manager Tillinghast, as well as later with Fresh & Easy's corporate human resources manager Paula Agwu. Following the meeting with store manager Tillinghast, Shannon Hardin was given a verbal warning regarding her work performance, although it wasn't stated that it was explicitly for talking about the union while working in the store, according to Judge Kocol's decision.

Tllinghast then told Hardin not to discuss with other store employees the disciplinary action he gave her. She did, and a written action in the form of a performance improvement plan (PIP) followed from the store manager, according to the judge's decision summary. Employees have a protected right to discuss with co-workers any disciplinary action they receive from superiors, according to U.S. labor law.

Earlier, store team leader Soliz had also "invited" Hardin to quite her job at the Fresh & Easy store if she wasn't happy, according to the judge's decision.

In testimony before the judge, Hardin said these incidents took an emotional toll on her, including breaking down emotionally while working at the store, which was one of the things she was disciplined for by her superiors.

In his decision in favor of the UFCW union, Judge Kocol concluded Fresh & Easy violated two sections of the National Labor Relations Act.

Below are his conclusions in the decision:

Respondent (Fresh & Easy) has engaged in unfair labor practices affecting commerce within the meaning of Section 8(a)(1) and Section 2(6) and (7) of the Act by:

(a) Promulgating and maintaining a rule prohibiting employees from talking about the union to each other while working but not prohibiting talking about other subjects.

(b) Inviting employees to quit their employment as a response to the protected concerted activities of the employees.

(c) By prohibiting employees from talking about their discipline with other employees while working but not prohibiting talking about other subjects.

Based on his decision against Tesco's Fresh & Easy in the case, Judge Kocol issued the following recommended order, which must get final approval by a body of the National Labor Relations Board:

The Respondent, Fresh & Easy Neighborhood Market, Inc., its officers, agents, successors, and assigns, shall

1. Cease and desist from:

(a) Promulgating and maintaining a rule prohibiting employees from talking to each other about the Union while working but not prohibiting talking about other subjects.

(b) Inviting employees to quit their employment as a response to the protected concerted activities of the employees.

(c) By prohibiting employees from talking about their discipline with other employees while working but not prohibiting talking about other subjects.

(d) In any like or related manner interfering with, restraining, or coercing employees in the exercise of the rights guaranteed them by Section 7 of the Act.

2. Take the following affirmative action necessary to effectuate the policies of the Act.

(a) Within 14 days after service by the Region, post at its facility in Spring Valley, California, copies of the attached notice marked “Appendix.”[3] Copies of the notice, on forms provided by the Regional Director for Region 21, after being signed by the Respondent’s authorized representative, shall be posted by the Respondent and maintained for 60 consecutive days in conspicuous places including all places where notices to employees are customarily posted. Reasonable steps shall be taken by the Respondent to ensure that the notices are not altered, defaced, or covered by any other material. In the event that, during the pendency of these proceedings, the Respondent has gone out of business or closed the facility involved in these proceedings, the Respondent shall duplicate and mail, at its own expense, a copy of the notice to all current employees and former employees employed by the Respondent at any time since June 11, 2009.

(b) Within 21 days after service by the Region, file with the Regional Director a sworn certification of a responsible official on a form provided by the Region attesting to the steps that the Respondent has

The NLRB has yet to make the Administrative Law Judge's decision final; it's still classified as pending, which is essentially a procedural issue since the case was only recently decided on June 3, 2010.

Fresh & Easy Neighborhood Market has the right under U.S. labor law to appeal the Administrative Law Judge's decision to the NLRB.

Readers: We suggest you read the full decision by Administrative Law Judge William G. Kocol, which includes a full summary of the details of the case and his conclusions. You can view it here.

For a selection of past stories in Fresh & Easy Buzz about the UFCW union and Tesco's Fresh & Easy Neighborhood Market (and related topics and issues) click here and here. Also click the older-newer links at the bottom of the linked pages for more posts.

Tesco's Fresh & Easy on the Agenda Today at Cal State Fullerton Social Justice Summit in Southern California

With the exception of picketing at selected stores, primarily in the Fresno region in California's Central Valley and in Southern California, along with some fairly stealth behind the scenes organizing of workers, the United Food & Commercial Workers (UFCW) union has been rather quite over the last year in its now three year campaign to organize store-level employees of Tesco's Fresh & Easy Neighborhood Market.

But today, nestled among the various seminars and workshops on social action, grassroots organizing, community development, human rights and environmental issues at California State University Fullerton's 6th Annual Social Justice Summit in Southern California, one particular workshop stood out among all the others to Fresh & Easy Buzz: "Organizing for Respect, Dignity and Justice at Fresh and Easy Neighborhood Market," presented by Berny Enriquez of the United Food and Commercial Workers union.

The workshop - also billed as "Building Worker Power at Fresh and Easy," is being held from 11:30 am -to- 12:30 pm today in the Titan Student Union Building at the free, all day summit, sponsored by Cal State Fullerton's Volunteer and Community Service Center, which is located on the campus in Orange County.

The university center bills the annual event, which is attended by thousands of academics, political and religious leaders, members of organized labor, and regular citizens, as "providing a forum for people to exchange ideas about improving the state of our communities, offers space to dialogue about the obstacles to creating effective change, provides effective tools for social action, and offers tangible grassroots solutions."

The inclusion of the UFCW-Fresh & Easy workshop at today's event is interesting for a couple of key reasons.

First, it's the only workshop on the agenda at the Social Justice Summit that focuses specifically on an individual company - Tesco's Fresh & Easy Neighborhood Market.

Second, it's also the only workshop on today's agenda with a specific focus on organized labor and the organizing of non-union companies.

Both of these items are important in that (1) the UFCW chose Tesco's Fresh & Easy as the one out of the numerous (Walmart, Target, Whole Foods, Trader Joe's, for example) non-union food and grocery retailers it's attempting to organize to focus on at today's event; and (2) the organizers of the annual Cal State Fullerton Social Justice Summit invited the UFCW to present the Fresh & Easy organizing workshop at the event.

It's our analysis one of the reasons the UFCW has been less overt, particularly in Southern California where Tesco's Fresh & Easy is headquartered and where it has the majority of its stores, over the last year is because the retail grocery clerks' union has been putting more of a focus on building a grass roots, community-based coalition to help it achieve its goal of unionizing the grocery chain's store-level workers.

The participation in today's Cal State Fullerton Social Justice Summit is an example of these efforts. There have been other similar grass roots-type efforts of late for the UFCW.

Another reason, in our analysis, the UFCW has been less active in its Fresh & Easy employee organization efforts is because of the recession (high unemployment), coupled with the fact Tesco has been losing tons of money with its small-format, combination fresh foods and grocery chain. We estimate Tesco has lost at least $700 million on Fresh & Easy since 2006. The first stores opened in November of 2007.

Because of the high unemployment rates in California, Nevada and Arizona, where Tesco has its 152 Fresh & Easy stores, the UFCW took some flack for its very aggressive campaign in 2008 to early 2009. Since then the union has taken a much more low key approach in its efforts to organize the grocer's store-level workers, particularly on the public relations front.

However, the UFCW hasn't given up its efforts by any means, although many observers wonder why it went from such an aggressive campaign to such a low key one.

Tesco's Fresh & Easy was recently found by the National Labor Relations Board (NLRB) to have violated a section of the U.S. National Labor Relations Act, something we reported on in this March 4, 2010 story: Administrative Law Judge Finds Tesco's Fresh & Easy Violated Labor Relations Act in Ex-Store Employee, UFCW Union Complaint. Fresh & Easy says it plans to appeal the ruling.

Interestingly, the UFCW hasn't publicly gone after Tesco regarding the NRLB ruling. For example, the union hasn't issued a press release about the issue, nor has it used the ruling in its campaign to unionize Fresh & Easy in any demonstrable way.

Tesco Fresh & Easy's public position is that its store-level employees have the right to organize a union if they so desire, based on U.S. labor laws. However, the NRLB violation involves a lawsuit by a former Fresh & Easy employee who charged the grocer interfered with her right to do just that, which the judge in the case agreed was the case.

Thus far, there hasn't been a Fresh & Easy store where employees have called for an open ballot election for membership in the UFCW, which is the key step to being recognized as a union shop.

We predict once there's a marked improvement in the economies, particularly lower unemployment, of these three states - California, Nevada and Arizona - we will see a marked increase in the level and intensity of activity on the part of the UFCW in its Fresh & Easy organizing campaign.

Also look for increased efforts on the part of the union to build a strong, community-based coalition in Southern California, likely comprised of many of the organizations and individuals in attendance at today's Cal State Fullerton Social Justice Summit, as a way to improve its odds in organizing Fresh & Easy employees.

[Linkage: Click here for an extensive selection of past stories in Fresh & Easy Buzz about the UFCW union-Fresh & Easy topic and issue.]

Follow Up: Will Tesco's Fresh & Easy Appeal Judge's-NRLB Ruling it Violated U.S. Labor Relations Act?

On March 4, 2010, we broke the news that Federal Administrative Law Judge Gregory Z. Meyerson ruled that Tesco's Fresh & Easy Neighborhood Market violated a section of the U.S. Labor Relations Act involving a complaint filed with the National Labor Relations Board (NLRB) against the grocery chain by a former Las Vegas Fresh & Easy store employee and the United Food & Commercial Workers (UFCW) union.

See our March 4, 2010 story: Aministrative Law Judge Finds Tesco's Fresh & Easy Violated Labor Relations Act in Ex-Store Employee, UFCW Union Complaint.

The judge ruled that Fresh & Easy violated one section named in the complaint.

He found Fresh & Easy to be in violation of interfering with store employees legal right and ability to organize or join an organized labor organization, in this particular case the UFCW union.
In his ruling, Judge Meyerson ordered Fresh & Easy to stop using certain specific means to prevent employees from distributing UFCW union literature at the stores and to stop visiting store workers at home and questioning them about their communications and meetings with union representatives

Following the publication of our March 4 story, on March 8 the supermarket industry trade publication Supermarket News published this news item in which it said Tesco's Fresh & Easy (evidently a spokesperson) told the publication it plans to appeal the judge's ruling, which as we noted in our March 4 report is something the grocery chain has the right to do under law.

As of Friday, March 12, Tesco's Fresh & Easy hadn't filed an appeal, according to information we obtained from the National Labor Relations Board. The grocery chain still has ample time to appeal though if it decides to do so.

Administrative Law Judge Finds Tesco's Fresh & Easy Neighborhood Market Violated Labor Relations Act in Ex-Store Employee, UFCW Union Complaint

Tesco's Fresh & Easy Neighborhood Market has been found by a Federal Administrative Law Judge to be in violation of a section of the U.S. National Labor Relations Act, regarding an unfair labor practices complaint filed with the National Labor Relations Board (NRLB) against the El Segundo, California-based food and grocery chain last year by Deana Kenton, a former employee at Fresh & Easy store number 1247 on East Lake Mead Boulevard in Las Vegas, Nevada, and the United Food & Commercial Workers Union (UFCW).

Former store employee Kenton, who was fired by Fresh & Easy, and the UFCW union charged in their unfair labor practices complaint last year that Tesco's Fresh & Easy Neighborhood Market violated Sections 8(a)(1), (3), and (4) of the National Labor Relations Act.

These sections of the act pertain in general to allowing employees the free ability, within mandated guidelines, to involve themselves in the organization of labor unions at the workplace. Administrative Law Judge Gregory Z. Meyerson heard the case in Las Vegas, Nevada on November 17-18, 2009.

The complaint charged that Tesco's Fresh & Easy Neighborhood Market violated Section 8(a)(1) of the National Labor Relations Act by "promulgating and maintaining an unlawful no-distribution policy, by interrogating its employees about their union activities and sympathies, by creating an impression among its employees that their union activities were under surveillance, and by soliciting employee complaints and grievances and promising to improve terms and conditions of employment if the employees refrained from union organizational activities."

Additionally, Ms. Kenton's and the UFCW union's complaint alleged that Fresh & Easy "violated Section 8(a)(3) of the Act by discharging its employees Tamara Williams (Williams) and Deana Kenton (Kenton) because of their support for the Union, and also violated Section 8(a)(4) of the Act by discharging Kenton because she cooperated with the Board in the investigation of unfair labor practices charges filed against the Respondent."

Tesco's Fresh & Easy denied they committed any unfair labor relations practices and fought the case at the two day hearing in November.

Judge Meyerson's decision on Deana Kenton's and the UFCW's unfair labor practices complaint against Tesco's Fresh & Easy has only been released by the NRLB recently. The first release date for the full decision was February 5, 2010, and a second notice was just released on March 3, 2010.

In his decision Judge Meyerson found that Tesco's Fresh & Easy Neighborhood Market had violated Section 8(a)(1) of the National Labor Relations Act, which basically prohibits employers from interfering with the rights of employees to organize, form, join, or assist a labor organization or union and to bargain collectively. [The complete language of the Act is here.]

The judge, however, recommended in his ruling that the other unfair labor act charges against Fresh & Easy contained in the complaint be dismissed.

Below (in italics) is Judge Meyerson's "order of action" for Tesco's Fresh & Easy to take having been found to have committed the labor relations act violation:

ORDER

The Respondent, Fresh & Easy Neighborhood Market Inc., its officers, agents, successors, and assigns, shall

1. Cease and desist from:(a) Promulgating and maintaining in its employee handbook and on its company intranet site an unlawfully broad no-distribution rule prohibiting the distribution of literature on its premises for any purpose;

(b) Interrogating its employees about their union activities and sympathies;

(c) Creating an impression among its employees that their union activities were under surveillance; and

(d) In any like and related manner interfering with, restraining, or coercing its employees in the exercise of the rights guaranteed to them by Section 7 of the Act.2. Take the following affirmative action necessary to effectuate the policies of the Act:(a) Within 14 days after service by the Region, post at each of its Las Vegas, Nevada, area stores copies of the attached notice marked “Appendix.”27 Copies of the notice, on forms provided by the Regional Director for Region 28, after being signed by the Respondent’s authorized representative, shall be posted by the Respondent and maintained for 60 consecutive days in conspicuous places including all places where notices to employees are customarily posted. Reasonable steps shall be taken by the Respondent to ensure that the notices are not altered, defaced, or covered by any other material. In the event that, during the pendency of these proceedings, the Respondent has gone out of business or closed any of the stores involved in these proceedings, the Respondent shall duplicate and mail, at its own expense, a copy of the notice to all current employees and former employees employed by the Respondent at any time since April 1, 2009; and

(b) Within 21 days after service by the Region, file with the Regional Director a sworn certification of a responsible official on a form provided by the Region attesting to the steps that the Respondent has taken to comply.

If this Order is enforced by a judgment of a United States court of appeals, the words in the notice reading “Posted by Order of the National Labor Relations Board” shall read “Posted Pursuant to a Judgment of the United States Court.

IT IS FURTHER ORDERED that the complaint is dismissed insofar as it alleges violations of the Act not specifically found.

Dated at Washington, D.C. on February 9, 2010.

Gregory Z. Meyerson

Administrative Law Judge

[You can view the actual written notice Fresh & Easy is required to post in all of its Metropolitan Las Vegas, Nevada region stores at page 3o in the document linked here.]

Decisions by Administrative Law Judges are not binding legal precedent. And such decisions can be appealed to formal legal courts if one or both parties involved choose to do so, unless they've agreed in advance to not do so.

Judge Meyerson's complete decision, along with the full narrative history (which is an interesting read) of the unfair labor practices complaint filed last year by former Fresh & Easy Las Vegas store employee Deana Kenton and the United Food & Commercial Workers union, is available at this link.

We suggest you review the document in order to get a comprehensive understanding of the case from the perspectives of both sides.

Fresh & Easy Buzz has reported on, written about, and offer extensive analysis on the UFCW union's campaign to organize Tesco Fresh & Easy store workers and Fresh & Easy's response. You can read a selection of those posts here.

Safeway, Kroger Co. and UFCW Union Agree to Extension in Colorado Store Worker Contract Dispute; We Suggest A 'No Loser' Policy in Negotiations

Food & Grocery Retailing and Organized Labor: News, Analysis, Commentary

Safeway Stores, Inc.'s Colorado division and the United Food & Commercial Workers (UFCW) union avoided a potential employee strike at Safeway supermarkets in the western state when the grocery chain decided to extend its just-expired union contract until May 30, giving the retailer and UFCW local 7, which represents the store workers, more time to negotiate a new contract.

Safeway operates over 100 supermarkets in the Colorado Rocky Mountain region.

Safeway Stores, Inc. issued a statement today announcing the contract extension.

Colorado Safeway store workers voted yesterday in favor of a strike but have agreed to continue to work under the old contract, which expired at 11:59 p.m. Saturday, May 9, until a new contract can be agreed upon or the May 30 contract extension deadline is reached, according to Kristine Staaf, a spokesperson for Safeway Stores.

Safeway's Colorado Rocky Mountain division isn't the first supermarket chain in the state to extend its contract with the UFCW over the weekend.

Yesterday another supermarket chain with stores in Colorado, Kroger Co.-owned King Soopers, decided to extend the union contract for its store-level employees to May 30 after being offered the opportunity to do so earlier in the week by UFCW local 7.

Safeway-Colorado and Kroger's King Soopers-Colorado had previously agreed to a mutual pact in which if employees of one chain or the other went out on strike, the other chain would then lock out its store-level workers in return. This has become a common strategy among unionized supermarket chains in the U.S. when the UFCW threatens a strike if a new contract isn't agreed upon within a certain timeline.

Such an agreement won't be needed between now and May 30 however, since employees for both chains have indicated they plan on working through contract negotiations, at least until May 30.

The contract negotiations and threat of an employee strike come at an obvious difficult time --the recession, massive unemployment, and the financial crisis -- for both the two grocery chains and their employees.

The union and its employees want a slight wage increase under the proposed new contract.

The two grocery chains want wages kept where they currently are under the new contract.

The union wants certain changes to the employee pension system, chief among them is changing the age in which store-level workers are eligible to start receiving their pensions, from the current age of 55, to age 50.

Safeway and Kroger's King Soopers want to keep the minimum retirement age right where it was in the just-expired contract -- at age 55.

Safeway Stores' and Kroger/King Soopers' Colorado divisions are the two leading supermarket chains in the the state. Albertsons, also unionized, is number three.

Fresh & Easy Buzz Analysis and Commentary

Unionized supermarket chains like these three pay store-level employees with one-year of full-time experience from about 30% to as much as 50% more per hour than what non-union grocery and mass merchandiser chains like Wal-Mart, Target, Costco, Trader Joe's, Tesco's Fresh & Easy, Colorado-based Sunflower Farmers Market, Whole Foods Market and others do.

The hourly wage for a full-time journey-level retail clerk at a unionized supermarket chain in the Western U.S. is about $20 an hour. They also receive a higher hourly wage when they work on Sunday and on holidays.

The unionized supermarket chains also offer workers a defined benefit pension plan.

The non-union chains generally offer 401-k-type of plans in which the employer matches a certain percentage of a store worker's contribution.

A UFCW-affiliated union chain employee with 30 years' of full-time service can retire after such service and collect as much as $40,000 annually in pension benefits every year he or she is alive post retirement.

Additionally, the UFCW-union supermarket chain health plan is among the best of any business sector, at any level, in the United States. Compared to most health plans the unionized supermarket clerks have more choice, lower employee contributions and minimal co-payments.

There's a growing frustration among the CEO's and others at unionized supermarket chains like Safeway, Kroger, Supervalu, Inc. and others because the fastest-growing retailers of food and groceries, the ones nipping hard at their heels, are non-union.

In Colorado this challenge from non-union retailers especially includes Wal-Mart with its Supercenters, Costco with its big box stores that sell fresh foods and groceries, and Target with its discount format stores and Super Target stores, which are similar to a Wal-Mart Supercenter.

To a lessor but important extent it also includes increased competition from the non-union and fast-growing natural foods-grocery hybrid chains Sunflower Farmers Market and Natural Grocers, both which are based in Colorado.

These non-union chains, which generally pay lower hourly wages and offer less in employee benefits than do unionized Safeway and Kroger, have been and continue to open new stores in Colorado, putting pressure on the unionized chains.

The unionized chains argue that because these non-union retailers pay employees less and offer fewer benefits, it puts them at a competitive disadvantage when it comes to retail pricing. Despite that fact, Safeway and Kroger are both rather competitive with Wal-Mart and Costco on price -- and are actually lower overall than Target.

It's important to note that neither Safeway or Kroger has been or is talking about breaking the union. Nor are they complaining. But they have a valid argument, one the UFCW should take seriously we believe, about the competitive advantage afforded the non-union competitors.

Safeway Stores' and Kroger Co.'s stores in Arizona, Nevada and California aren't affected by the contract negotiations or threatened strike. The divisions in these respective Western States --the three states where Tesco's Fresh & Easy operates its 120 non-union grocery and fresh foods markets -- operate under separate contracts.

Safeway Stores, Inc. operates 500-plus supermarkets in California, Nevada and Arizona under the Safeway and Vons banners.

Kroger Co. operates about the same number of stores in the three states. It's banners in the three states are: Ralphs (Southern and Central California), Food 4 Less (Southern California, Nevada); FoodsCo (Northern California) Smith's Food & Drug (Nevada) and Fry's (Arizona).

Additionally, both Safeway and Kroger operate hundreds of additional supermarkets in other Western U.S. states, including in addition to Colorado, in Oregon, Washington State and elsewhere in the west.

The fact that non-union retailers have been gaining on unionized supermarket chains is best demonstrated by looking at the changes in the ranking of the top-five retailers of food and groceries over just the last four -to- five years.

Just four years ago Kroger Co. (unionized) was the number one retailer of food and groceries in the U.S., followed by non-union Wal-Mart at number two, Supervalu, Inc. (unionized) at number three and Safeway Stores, Inc. a (unionized) number four.

Today, non-union Wal-Mart is the number one food and grocery retailer nationally in the U.S. Kroger (unionized) is number two. Non-union Costco is number three Unionized Supervalu, Inc. is fourth and Safeway Stores, Inc. (unionized) is number five.

Non-union Wal-Mart and Costco have been the two fastest-growing chains among these top five in terms of annual sales volume.

Additionally, Aldi USA and Whole Foods Market, Inc., both multi-billion dollar a year grossing non-union chains, and both among the top-25 largest chains in the U.S., have grown faster on a percentage basis than any unionized supermarket chain in the U.S. over the last five years.

American workers are seeing wage stagnation greater than ever in recent history during this recession. In fact, such wage stagnation has been going on for at least the last five years.

And of course, most American workers just want to hold on to their jobs right now, since finding a new one at present reminds one of that old song: " (Dream) The Impossible Dream."

Such are the realities facing Safeway Stores, Inc., Kroger Co., the UFCW union and the employees of Safeway's Colorado stores and Kroger's King Soopers supermarkets this weekend.

All sides in the negotiations should be extra considerate of one another in these tough times, we suggest. Give and take must be the order of the day. It's not a time for winners and losers. The stakes are too high for all of the stakeholders involved.

And, with all due respect to the UFCW... Is this really a good time to be arguing for the retirement age for unionized supermarket clerks to be reduced from age 55 to 50? We get it -- the more folks that retire at age 50 the more new jobs open, at least theoretically. That could backfire though, actually, in the form of employers freezing openings.

It's just that the move is rather tin ear we think for the current times. Right now the vast majority of Americans in their late fifties and early sixties, including those at retirement age now, will have to postpone retirement because they can't afford it.

Therefore, along with a couple other reasons, we aren't sure arguing for unionized grocery clerks to get the same retirement benefits at age 50 that they now get when they retire at 55 if they choose to is a good move in terms of gaining public support. Not to mention getting continued support from unionized supermarket chains.

Related Stories from Fresh & Easy Buzz:

>April 13, 2009: Analysis: Major Retailers Costco, Whole Foods Market and Starbucks Propose Employee Free Choice Act 'Third Way' Compromise; What About Fresh & Easy?

>February 13, 2009: Labor & Food Retailing: Kroger Co. Chains Sign New Contract With the UFCW Union in Vegas; What Happened to the UFCW Tesco Fresh & Easy Campaign?

>November 10, 2008: Food Retailing & Organized Labor: Tesco's Fresh & Easy Gets Some Company as the UFCW Union Launches Campaign to Unionize Wakefern's PriceRight Banner

>November 4, 2008: U.S. Organized Labor, Including the UFCW Union, is Feeling Good Tonight About A President Obama and Stronger Democratic Majority in Congress

>October 28, 2008: The UFCW Union, Tesco's Fresh & Easy, U.S. Labor Relations, and Next Week's Presidential and Congressional Election

>October 2, 2008: Tesco Fresh & Easy Denies Huntington Beach Store Employees Request to Be Recognized As A Union Store; Next Step Likley to Be Open Ballot Election

>September 26, 2008: News & Analysis: Employees At Two More Fresh & Easy Grocery Stores Could Soon Request UFCW Union Recognition From Tesco's Fresh & Easy

>September 17, 2008: Store Workers at Huntington Beach Fresh & Easy Demand Union Recognition From Tesco Fresh & Easy Neighborhood Market

>August 27, 2008: UFCW Union Reports Tesco Fresh & Easy Neighborhood Market's Prepared Foods Supplier to Labor Board For What it Says is Unfair Firing of Six Employees

>August 5, 2008: UNI Global Union Launches Tesco-Specific Alliance; Calls For Tesco Executives to Meet With UFCW Union Officials Over Fresh & Easy Neighborhood Market

>August 4, 2008: Pico Rivera, California City Council Members Boycott Fresh & Easy Store Grand Opening; Mayor Attends But Delivers Pro-UFCW Union Message to Execs

>July 30, 2008: UFCW Union Flyers On His Door Knob Cause Heat in 'The Pragmatic Chef's' Mental Kitchen; Others Wondering About the Negative Campaign As Well

>July 3, 2008: Mid-Week Fresh & Easy Roundup: Fresh & Easy Gets Caught in A Land Use Dispute; Those Near-Famous Mixed Grill Packs; More On Manhattan Beach

>July 4, 2008: Breaking News: UFCW Union Strikes Again With Anti-Tesco Fresh & Easy Brochure Drop in Neighborhood Surrounding New Manhattan Beach Store

>July 2, 2008: UFCW Union Pickets Out in Force This Morning At Manhattan Beach Fresh & Easy Store Grand Opening

>June 30, 2008: Breaking News: UFCW Union Launches Preemptive Anti-Tesco Fresh & Easy Brochure Distribution Drop on the Eve of Manhattan Beach Store Grand Opening

>June 26, 2008: Tesco 2008 AGM: Barack Obama Sends Second Letter to Tesco CEO Requesting the Company Meet With U.S. UFCW Union Leaders About Fresh & Easy

>June 22, 2008: Vocal Cast of Critics and Advocacy Groups to Attend Tesco's Annual General Meeting On Friday, June 27

>June 4, 2008: News and Analysis: UFCW Union Takes its Tesco Union Organizing Campaign Across the Pond to the United Kingdom Beginning Today

>March 26, 2008: United Food and Commercial Workers Union Begins its Spring 2008 Organizing and Communications Campaign Directed at Tesco's Fresh & Easy

>February 11, 2008: Supermarket Union President Asks Britain's Prince Andrew to Arrange A 'Sit-Down' With Tesco Fresh & Easy Neighborhood Market Senior Executives

[Follow Fresh & Easy Buzz around on Twitter.com at www.twitter.com/freshneasybuzz]

Analysis: Major Retailers Costco, Whole Foods Market and Starbucks Propose Employee Free Choice Act 'Third Way' Compromise; What About Fresh & Easy?

Members of the United Food & Commercial Workers (UFCW) union and their families, like those pictured above, are out campaigning for passage of the Employee Free Choice Act, which will likely be voted on soon in Congress.

On March 22, the CEO's of two food and grocery retailing companies -- Jim Sinegal of Costco and John Mackey of Whole Foods Market, along with Howard Schultz, the CEO of Starbucks -- announced that the three retailers had formed what they are calling the ad hoc "Committee for a Level Playing Field for Union Elections."

Specifically, the three leading U.S. retailing chains say the group has come together to open dialogue about a "third way" approach to reform labor law. The group says its "purpose is to offer a new solution wholly distinct from the recently-introduced and controversial 'card check' bill, the Employee Free Choice Act (EFCA)."

All three retailers -- Costco, Whole Foods Market and Starbucks -- are currently non-unionized chains.

Heading up the "committee" is the highly-connected Washington, D.C. lawyer Lanny Davis, a Liberal Democrat. Davis, who is a partner in the Washington, D.C. office of the Orrick, Herrington and Sutcliffe law firm, most recently led Whole Foods Market, Inc.'s team of outside legal counsel (three firms) in the natural grocery chain's battle against the U.S. Federal Trade Commission's (FTC) nearly two year antitrust legal challenge against Whole Foods' 2007 acquisition of rival natural foods retailing chain Wild Oats Markets.

On March 6, 2009 the FTC and Whole Foods reached a settlement agreement which required Whole Foods Market, Inc. to only sell 13 stores (12 former Wild Oats stores and one existing Whole Foods banner store, sell 19 former Wild Oats stores that were already closed, and sell the acquired Wild Oats' brand and related intellectual property.

Lanny Davis, the spokesperson for the "third way" group, came onto the Whole Foods legal team in about January, 2009. Prior to that the FTC had made every indication that it planned to do all in its power to overturn the 2007 merger-acquisition. Just two months later, on March 6, a settlement agreement was reached. The politically-connected Davis, who is more of a lobbyist-lawyer than he is a litigator, was instrumental in Whole Foods' being able to settle the antitrust challenge.

Davis served as former President Bill Clinton's Special Legal Counsel in the 1990's, where he honed his skills by defending the President and now Secretary of State and former First lady Hillary Clinton against a myriad of charges -- Trooper Gate, Whitewater, the Monica Lewinsky scandal and impeachment -- just to name three.

Lanny Davis is a close personal friend of Hillary Clinton. They met while attending Yale Law School together in the 1960's and have been fast friends and political allies since. Davis was a key fund raiser for and supporter of Hillary Clinton's 2008 campaign for the Democratic nomination for U.S. President in 2008.

And when Barack Obama won the nomination, Davis became the leading public and private advocate within the Democratic party for her being named Vice President by President Obama.
When the then Democratic nominee and now President named Joe Biden as his Vice President, Davis became the leading advocate to the Obama team for Ms. Clinton's being named Secretary of State. She was named to that position by President Obama.

In making the announcement of the Costco-Whole Foods Market-Starbucks "third way" on the Employee Free Choice Act (EFCA) legislation coalition on March 22, Lanny Davis said: "The founding companies that formed the committee have consistently appeared on Fortune Magazine's 100 Best Companies to Work For. Their CEO's -- James Sinegal of Costco, Howard Schultz of Starbucks, and John Mackey of Whole Foods Market -- today introduce a 'Statement of Principles,' that would substantially level the playing field for union organizers, improve their access to employees and provide a fair chance to make their case for a union election."

The use of the term "third way" by the Lanny Davis-led retailer coalition is very interesting. Former President Clinton, who's administration Lanny Davis was a member of for a number of years as legal counsel (along with being close to both of the Clintons), often used the term "third way" to describe its centrist approach to politics and governing, meaning not right or left, or highly partisan, but using a "third way." [Click here for information about what's called the "third way" approach to politics and legislation.]

Interestingly, former Illinios Congressman Rham Emmanuel, who is currently President Obama's chief of staff and was a former staff member in the Clinton Administration, was one of the promoters of that "third way" strategy and position during the first Clinton Presidential campaign and during Clinton's first term. The "third way" didn't last much in President Clinton's second term, amid all the partisan ranker that took place.

Below are the six principals the Costco, Whole Foods Market and Starbucks CEO's have designated as what they want to be part of the debate (and a part of the eventual legislation if they get their way) in Congress over the Employee Free Choice Act (EFCA), which the U.S. House of Representatives is beginning to discuss and debate, and will likely vote on in the next couple months:

1) Secret Ballot. Guarantee the right of management and unions to require a secret ballot under all circumstances.

(2) Certification and Decertification Treated Equally. Permit management to initiate a decertification campaign through a secret ballot election just as employees and unions are presently able to initiate certification and decertification campaigns.

(3) Date Certain for Elections. Guarantee a fixed time period for the secret-ballot election--i.e., do not permit delays of an established day for a secret ballot to certify or decertify a union.

(4) Equal Access to Employees for Campaign Purposes. Level playing field for unions and management to access employees during non-working hours during the campaign period, e.g., permitting each to make presentations to employees at a neutral location concerning the issue of whether to form a union.

(5) Expedited Enforcement and Stricter Penalties. Expedited enforcement for serious and pervasive violations of law by labor and management and stricter penalties for serious and pervasive violations (e.g., unlawful discharges), including the penalty of mandatory injunctions when appropriate.

(6) Preserve Private Collective Bargaining. No mandatory arbitration that dictates contract terms, but stricter penalties and expedited enforcement for violations of good faith bargaining rules, including an expedited timetable to begin bargaining after union certification.

These six principals would guarantee a fixed time period for the secret-ballot election--by eliminating delays for establishing a day for a secret ballot to certify or decertify a union, Lanny Davis, representing the three retailers, says. The principles also include increased penalties for serious and pervasive violations of the law by labor or management and expedited procedures to impose them, Davis says.

Davis says the group strongly opposes the EFCA in its current form, which includes the abolition of a guaranteed option for management or employees to require a secret ballot, what they call a "bedrock principle of American democracy."

The group also opposes the EFCA's provision for government-imposed mandatory arbitration dictating terms of employment, which would overturn the time-valued tradition dating back to Franklin Delano Roosevelt and the Wagner Act of 1935 that preserves private, good faith collective bargaining, free of government intrusion or dictates, according to Davis and the group's position statement.

"We believe in and trust our employees, which is neither anti-union nor pro-status quo," says James Sinegal, the CEO of Costco. "We favor fairness and believe that the passage of a law based on these six principles will ensure a fair opportunity for workers to make an informed choice, with a secret ballot, whether they want a union or whether they wish to retain non-union status."

The coalition is asking other retailers that agree with its approach to join their group So far no other retailers we are aware of have joined Costco, Whole Foods Market and Starbucks in the coalition. It's only been three weeks since the retailers announced the formation of the group though.

The main aspect of the Employee Free Choice Act (EFCA) that's got non-unionized food and grocery retailers, along with most of corporate America and small businesses, up in arms is what's called the "Card Check Provision." Card check basically allows workers at non-union businesses (or stores in the case of retailers) to check a box on a card provided by a union indicating if the employee is for or against unionization. If a majority of the employees check "yes," that they are for a union shop, the company or business must go along with the worker-majority and unionize that particular store, plant or other business place.

Currently, employees, unions and employers go through a secret ballot process similar to how American citizens vote for their elected political leaders -- from city Mayor on up to President of the United States. The secret ballot process allows employers to lobby workers extensively if they desire to do so, attempting to persuade them that joining a union would be against their best interests and the interests of the company they work for.

Unions argue this process is unfair because it stacks the deck against unionization. Employers argue that's not true. It's a stalemate. And it's one of the primary reasons that organized labor wants the Employee Free Choice Act and its "Card Check" provision passed into law.

It's this "Card Check" provision of the EFCA that the Costco-Whole Foods-Starbucks coalition wants to change most.

Lanny Davis says that, contrary to assertions made by supporters of the EFCA, the card-check bill would, in fact, permit the exclusion of the secret ballot option. "It defies logic to say that once 51% of eligible voters sign the cards, the union that is entitled to automatic certification under EFCA would then ask for a secret ballot. That deprives the 49%, and perhaps some who signed the cards under pressure, the right to demand a secret ballot."

Organized labor says the "Card Check" provision in the current Employee Free Choice Act (EFCA) legislation before the U.S. House of Representatives allows for employees to choose a secret ballot election if they desire, or to choose the card check off process. As such, the unions say the bill offers full employee choice.

Davis says he has discussed the Costco-Whole Foods Market-Starbucks "Statement of Principles" with the staffs of almost two dozen Democratic and Republican Senators. Most, he said, indicated the Senators for whom they worked were "positive about our third way approach, including many Democratic Senators who were co-sponsors of EFCA and had voted for the same measure last year."

"I'm proud to call myself a pro-labor liberal Democrat who believes that reforms are needed to provide a level playing field for both labor and management, but not at the expense of a guaranteed option for a secret ballot by both workers and management and certainly not at the expense of preserving the historic process of private, voluntary collective bargaining, Davis says. "I consider the committee's third way' proposal based on these six principles to be favorable to labor and fair to management. "If I did not, I would not have taken on this assignment."

"Given the severe economic crisis facing America it is time to avoid the polarization that has occurred on both sides of this issue, and instead, come together to find a productive approach," Davis adds.

Organized labor's AFL-CIO responds

The AFL-CIO's Bill Samuel recently responded to the Costco-Whole Foods Market-Starbucks coalition and Lanny Davis' arguments in a statement. Below is what the union leader said:

"The Employee Free Choice Act is about protecting the fundamental freedom of workers to bargain with their employers for a better life and to join a union without corporate interference and harassment. The proposal being circulated by these companies falls short of meeting these standards.

We (AFL-CIO) are open to discussing the legislation with parties who are legitimately concerned with protecting workers. However, a proposal coming from corporations, some of whom have their own history of violating workers' rights, is simply not an alternative that lives up to giving workers back the freedom to form unions.

Of particular concern (to organized labor) is the removal of majority sign up – which exists under current law - and the removal of the arbitration provisions. Removing the arbitration provisions will allow companies to continue to stall and delay and refuse to negotiate a contract in good faith.

It appears the battle is joined.

U.S. House and the Employee Free Choice Act

The Employee Free Choice Act (EFCA) passed the U.S. House of Representatives in 2007 with a strong majority (241 members in favor, 185 against). Most Congressional observers expect the 2009 EFCA bill to pass in the House by an equally wide margin again this year when it is voted on.

The Democrats obtained an even stronger numerical House majority after the 2008 elections than they had in 2007. A majority win is all that's required to pass legislation in the House, unlike in the Senate where it takes 60 votes to pass a bill if the opposition party launches a filibuster of a given piece of legislation.

House Democratic speaker Nancy Pelosi is a major supporter of the Employee Free Choice Act (EFCA), and says getting the legislation passed is one of her key legislative priorities this year.

The U.S. Senate and the Employee Free Choice Act

The Employee Free Choice Act (EFCA) passed in the U.S. Senate in 2007 by a four vote majority -- 51 members for, 49 against. Forty seven Senate Democrats, the two Independents in the Senate, and one Republican -- Senator Arlene Spector of Pennsylvania who now says he opposses the EFCA -- voted for the bill in 2007. All of the Senate Republicans except Spector voted against the legislation in 2007.

But as mentioned above, majority does not rule in the Senate in most cases of legislation. Members of the minority party can filibuster a bill, which the Republicans did with the EFCA legislation in 2007. In order to beat a filibuster, 60 votes in favor of the bill are required. The Senate Democrats missed the mark by nine votes in 2007.

In addition, then Republican President George W. Bush was against the legislation, and planned to veto it if passed in the Senate. It takes those 60 votes in order to make a bill veto-proof. As a result, the Republicans were able to kill the EFCA bill in the U.S. Senate in 2007.

The Democrats gained a number of seats in the Senate in the 2008 election. But at a current 56 members they remain short of the full 60-member super-majority needed to prevent a filibuster. President Obama supports the EFCA though, so there is no concern over a Presidential veto as there was in 2007.

The Franken factor

The Democrats do have Senate member number 57 in waiting -- Former comedian Al Franken, who is ahead of Republican Norm Coleman by about 250 votes in what has become the longest-running vote recount in history in Minnesota. Coleman continues to challenge Franken's lead in the 2008 Minnesota Senatorial race. And the Democrats have refused to seat Republican Coleman, which makes sense since he hasn't won either, the former incumbent Senator from Minnesota, in the U.S. Senate, taking away his office. He remains in Minnesota challenging Franken's apparent victory.

Should the courts declare Al Franken the Democratic Senator from Minnesota, that would give the Democrats 57 votes in favor of the EFCA, assuming all of the other 56 Democrats vote in favor of the bill, which no longer is a lock as it was in 2007.

Additionally, If the two Independents -- Senator Bernie Sanders (I-Vermont) and Senator Joe Lieberman (I-Connecticut) -- vote in favor, as they both did in 2007, that would give the Democrats 59 votes, just one short of the required 60 votes needed to make any Republican filibuster moot.

That one vote, under the scenario, just recently went away with Republican Arlene Spector's changing his vote from "yea" to "nay" on the Employee Free Choice Act. But he could potentially change his mind back again, with enough enticement by the Democrat majority. Perhaps a federal government jobs' bill for recession-suffering Pennsylvania that is just too hard to refuse, for example?

The two Senate Independents are members of the Democratic Caucus and vote with the Democratic majority most of the time on domestic issues. Both support the EFCA at present. Lieberman is a former, long time Democrat who left the party after many of its leaders supported his Democratic challenger, Ned Lamont, in the last election.

Lieberman defeated Lamont in the Connecticut general election, changing his party affiliation from Democratic to Independent, which he still keeps. Lieberman supported Republican John McCain and not President Obama in the 2008 election. Despite that, President Obama reached out to the Independent and saved his Senate Committee Chairmanship for him, a debt owned the Democratic President, who supports the EFCA, by Joe Lieberman.

That means under this scenario -- Franken gets seated, all the Senate Democrats (57 with Franken) and the two Independents vote yes for a total of 59 votes -- that the Democrats will need to convince one moderate Republican to vote with the majority in order to pass the EFCA over any Republican fillibuster.

Pressure on moderate Senate Democrats

A coalition of business groups representing corporate America, agribusiness and small business (including the U.S. Chamber of Commerce) is now putting heavy pressure on a handful of conservative and moderate Democratic Senators like Senator Ben Nelson of Nebraska and Senator Bill Nelson of Florida (no relation) to vote against the Employee Free Choice Act (EFCA) legislation in its current form. The business coalition is particularly against the "Card Check" provision in any form being a part of the bill. Since most argue that "Card Check" is the key provision of the EFCA for organized labor, reaching some sort of compromise agreement will be very difficult.

Moderate Democratic Senators like Ben and Bill Nelson, along with a couple others from more conservative voting states, could find it politically difficult to vote for the EFCA though, because in the case of Senator Ben Nelson from Nebraska, which is a major farm state, agribusiness leaders in the state are dead against the legislation.

In the case of Senator Bill Nelson from Florida, his state is one of the hardest hit by the current recession. Business leaders are telling him that a vote for the EFCA by the moderate Senator would be a vote for killing jobs, attempting to put him in a no win situation if he supports the bill.

Of even more serious concern to the Senate Democrat leadrship is Senator Blanche Lincoln of Arkansas, who recently said she is going to have a difficult time voting for the Employee Free Choice Act (EFCA) as it's presently written. The supporters of the EFCA need her vote.

Another Democratic Senator who could go either way on the EFCA is Montana's John Tester, a moderate-to-conservative Democrat who won election in 2008 in a very traditionally Republican state. The first-term Senator wasn't in the Senate in 2007, when the last vote on the EFCA was taken.

The UFCW union and the Employee Free Choice Act

The United Food & Commercial Workers union (UFCW), which represents about 1.5 million unionized supermarket clerks in the U.S., Canada and Puerto Rico, is a major supporter of the Employee Free Choice Act (EFCA). The retail clerks union is currently devoting most of its financial and human resources to lobbying Congress, along with conducting a grass roots organizing campaign, to get the EFCA legislation passed this year.

You can read the UFCW union's position on the Employee Free Choice Act here.

The UFCW has conducted an aggressive campaign since early 2008 to unionize workers at Tesco Fresh & Easy's 116 grocery and fresh foods stores in California (Southern and Bakersfield), southern Nevada and Metropolitan Phoenix, Arizona. [Fresh & Easy Buzz was one of the first publications to report on the union's plans to organize Fresh & Easy store employees in an aggressive and comprehensive manner. Read our December 30, 2007 story here: UFCW Union to Organize Fresh & Easy Clerks in 2008.]

As we reported in this September 17, 2008 piece: [Store Workers at Huntington Beach Fresh & Easy Demand Union Recognition From Tesco Fresh & Easy Neighborhood Market], store-level workers at the Tesco Fresh & Easy Neighborhood Market grocery store in Huntington Beach (Southern) California formally requested of company management to be recognized as a union shop in September of last year.

In this October 2, 2008 story [Tesco Fresh & Easy Denies Huntington Beach Store Employees Request to Be Recognized As A Union Store; Next Step Likley to Be Open Ballot Election] we reported management's response to the store employees, which was to deny the request and suggest the store workers follow U.S. labor law rules and organize a secret ballot election if they desired UFCW union representation, which isn't an uncommon management response to such a letter. [See the bibliography at th end of this story for more reports and analysis.]

It's been six months since the Huntongton Beach store workers wrote their letter and Tesco Fresh & Easy's management denied the request. To date no secret ballot election has been held, nor is one planned as far as we are aware, at the Huntington Beach Fresh & Easy store. We recently talked to employees of the store who confirmed this situation.

Additionally, none of the employees at any other Fresh & Easy markets have requested union representation via letters to company management to date, based on our sources and research.[Related story - September 26, 2008: News & Analysis: Employees At Two More Fresh & Easy Grocery Stores Could Soon Request UFCW Union Recognition From Tesco's Fresh & Easy.]

The UFCW has, since late 2008, been far less aggressive in its campaign to unionize the Tesco Fresh & Easy store-level employees than it was for most of last year, as we wrote about in this piece [Labor & Food Retailing: Kroger Co. Chains Sign New Contract With the UFCW Union in Vegas; What Happened to the UFCW Tesco Fresh & Easy Campaign?] on February 13, 2009.

The union still has a major strategy to unionize Fresh & Easy though, along with numerous other non-union food and grocery retailing chains. Our sources and research tell us the UFCW's less aggressive approach to Tesco's Fresh & Easy over the last few months has more to do with its focus on getting the Employee Free Choice Act (EFCA) passed -- which then will make it much easier to unionize Fresh & Easy employees and all others at non-union chains -- than it does any less desire to unionize Tesco in the U.S.

The coalition's 'third way' and the UFCW

The UFCW has recently indicated, as have all of the U.S. labor unions, that it doesn't support the "third way" principles for the Employee Free Choice Act (EFCA) that are being suggested and advocated by the Costco-Whole Foods Market-Starbucks coalition.

However, with Al Franken yet to be seated as a U.S. Senator, Republican Senator Spector's changing of his position on the EFCA, and the increased pressure being put on moderate Democrats in the Senate by the business coalition against the Employee Free Choice Act (EFCA), some sort of compromise legislation is much more likely this year than it was in the period after the November 2008 election, in which organized labor helped elect a President (Obama) who is a major supporter of the EFCA, and saw a 57-member Democratic majority in the Senate, along with two Independents and one Republican, Senator Spector, all supporting the EFCA legislation, adding up to that magic 60-member filibuster-proof Democrat super-majority.

That 60-member super-majority is now gone, although lots of horse-trading and deal making will be going on by Senate Democrats to obtain it again on the Employee Free Choice Act EFCA).

Will other non-union retailers join the coalition?

In addition to Costco (which is ranked as the third-largest seller of food and groceries in the U.S. after Wal-Mart and Kroger Co. by a number of research fims) and Whole Foods Market, Inc. ($8 billion in annual sales), numerous top food and grocery retailers in the U.S. are non-union. These major retailers include: Wal-Mart (number one market share leader nationally in the U.S.); Target; Trader Joe's; and others.

And of course Tesco's Fresh & Easy -- which isn't a leading food and grocery retailer in the U.S. but is so globally, United Kingdom-based Tesco being the third-largest retailer in the world after number one Wal-Mart and number two Carrefour, which is based in France -- is a non-union grocery chain. Tesco, which is the number one food and grocery retailer in the United Kingdom, is unionized in Britain.

None of these retailers support the Employee Free Choice Act (EFCA) that we are aware of. Wal-Mart has publicly come out strongly against the legislation. We have yet to see a public position taken by Target, Trader Joe's or Tesco's Fresh & Easy. But, and you will have to trust us on this one, they are all against it.

The UFCW union has attempted to organize store-level employees at Wal-Mart, Whole Foods Market and Trader Joe's in the U.S. for many years, less so at Target. The union hasn't been able to get workers at one store in each of the three chain's unionized to date however.

Most of the leading supermarket chains in the U.S. -- Kroger Co., Supervalue, Inc. and Safeway Stores, Inc. (the top three) -- have all or many of their divisions and stores unionized, with employees represented by the UFCW. Numerous regional supermarket chains and independents, particularly in California and other stronger union states, are also union shops.

For example, in Southern California where Tesco has over half of its current 116 Fresh & Easy markets (the other slightly less than half are split between Arizona and Nevada), and where the grocery chain is headquartered, all of the leading supermarket chains -- Safeway-owned Vons, Kroger's Ralphs, Supervalu-owned Albertsons, Stater Bros. (the top four in market share) -- are unionized.

It will be interesting to see if Wal-Mart, Target, Trader Joe's, Tesco's Fresh & Easy -- all retailers that also position themselves as being progressive -- or any other non-union food and grocery (and other format) retailers join the Costco-Whole Foods Market-Starbucks "third way" coalition.

A major part of the positioning of the three retailers in forming the group and offering an alternative to the present EFCA legislation is that they are progressive retailers, as coalition spokesperson Lanny Davis has made a point of noting. Might other retailers that consider themselves in a similar "progressive" mode join the three? None have so far -- but it's still early.
Meanwhile, organized labor is showing no signs of interest yet in the Costco-Whole Foods Market-Starbucks proposal. And it's our analysis the unions won't unless it begins to look like the Employee Free Choice Act (EFCA) legislation isn't going to pass in the Senate -- it's a virtual lock in the House -- if and when it is voted on this year. The probability is high that it will be voted on in the U.S. Senate this year since House Speaker Pelosi says it will be in that body, perhaps very soon.

The Employee Free Choice Act issue and legislation is only beginning to heat up. It's going to get much hotter in the coming weeks and months. Stay tuned for continued and ongoing extensive reporting and analysis on the issue in Fresh & Easy Buzz.

[Below is a selected, linked bibliography of past stories and posts in Fresh & Easy Buzz about the UFCW union's campaign to unionize store-level employees of Tesco's Fresh & Easy Neighborhood Market (and related issues, including the Employee Free Choice Act), which currently has stores in California (Southern and Bakersfield), southern Nevada and Metropolitan Phoeniz, Arizona, in the Western United States.]

>February 13, 2009: Labor & Food Retailing: Kroger Co. Chains Sign New Contract With the UFCW Union in Vegas; What Happened to the UFCW Tesco Fresh & Easy Campaign?

>November 10, 2008: Food Retailing & Organized Labor: Tesco's Fresh & Easy Gets Some Company as the UFCW Union Launches Campaign to Unionize Wakefern's PriceRight Banner

>November 4, 2008: U.S. Organized Labor, Including the UFCW Union, is Feeling Good Tonight About A President Obama and Stronger Democratic Majority in Congress

>October 28, 2008: The UFCW Union, Tesco's Fresh & Easy, U.S. Labor Relations, and Next Week's Presidential and Congressional Election

>October 2, 2008: Tesco Fresh & Easy Denies Huntington Beach Store Employees Request to Be Recognized As A Union Store; Next Step Likley to Be Open Ballot Election

>September 26, 2008: News & Analysis: Employees At Two More Fresh & Easy Grocery Stores Could Soon Request UFCW Union Recognition From Tesco's Fresh & Easy

>September 17, 2008: Store Workers at Huntington Beach Fresh & Easy Demand Union Recognition From Tesco Fresh & Easy Neighborhood Market

>August 27, 2008: UFCW Union Reports Tesco Fresh & Easy Neighborhood Market's Prepared Foods Supplier to Labor Board For What it Says is Unfair Firing of Six Employees

>August 5, 2008: UNI Global Union Launches Tesco-Specific Alliance; Calls For Tesco Executives to Meet With UFCW Union Officials Over Fresh & Easy Neighborhood Market

>August 4, 2008: Pico Rivera, California City Council Members Boycott Fresh & Easy Store Grand Opening; Mayor Attends But Delivers Pro-UFCW Union Message to Execs

>July 30, 2008: UFCW Union Flyers On His Door Knob Cause Heat in 'The Pragmatic Chef's' Mental Kitchen; Others Wondering About the Negative Campaign As Well

>July 3, 2008: July 3, 2008: Mid-Week Fresh & Easy Roundup: Fresh & Easy Gets Caught in A Land Use Dispute; Those Near-Famous Mixed Grill Packs; More On Manhattan Beach

>July 4, 2008: Breaking News: UFCW Union Strikes Again With Anti-Tesco Fresh & Easy Brochure Drop in Neighborhood Surrounding New Manhattan Beach Store

>July 2, 2008: UFCW Union Pickets Out in Force This Morning At Manhattan Beach Fresh & Easy Store Grand Opening

>June 30, 2008: Breaking News: UFCW Union Launches Preemptive Anti-Tesco Fresh & Easy Brochure Distribution Drop on the Eve of Manhattan Beach Store Grand Opening

>June 26, 2008: Tesco 2008 AGM: Barack Obama Sends Second Letter to Tesco CEO Requesting the Company Meet With U.S. UFCW Union Leaders About Fresh & Easy

>June 22, 2008: Vocal Cast of Critics and Advocacy Groups to Attend Tesco's Annual General Meeting On Friday, June 27

>June 4, 2008: News and Analysis: UFCW Union Takes its Tesco Union Organizing Campaign Across the Pond to the United Kingdom Beginning Today

>March 26, 2008: United Food and Commercial Workers Union Begins its Spring 2008 Organizing and Communications Campaign Directed at Tesco's Fresh & Easy

>February 11, 2008: Supermarket Union President Asks Britain's Prince Andrew to Arrange A 'Sit-Down' With Tesco Fresh & Easy Neighborhood Market Senior Executives

>January 2, 2008: Sacramento Bee on UFCW Union and Fresh & Easy

>December 30, 2007: UFCW Union to Organize Fresh & Easy Clerks in 2008

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