Southern California Market Region Report
News/Analysis/Commentary
In this story [April 21, 2011: Union Grocery Store Workers' Vote Could Authorize Strike Against Southern California's 'Big Three' Grocery Chains] published in the very early hours of the morning, we said members of seven UFCW retail grocery union locals in Southern California would vote overwhelmingly in favor of authorizing a strike against the region's "big three" grocery chains - Kroger-owned Ralphs, Safeway's Vons and Albertsons, which is owned by Supervalue, Inc. - when the results of yesterday's vote were made public later today.
The results are in - and as we said would be the case, the UFCW-member grocery clerks voted by an overwhelming majority to authorize the union to call a strike if it feels its negotiations with the three supermarket chains are going nowhere, or if they become seriously bogged down.
According to representatives of the seven locals, about 90% of the UFCW members who voted yesterday, voted in favor of authorizing a strike.
There are 62,000 members of the combined seven locals. However, not all 62,000 members voted, and the UFCW officials are thus far keeping the number of members who voted yesterday under their union-label hats.
We also correctly said in our story early this morning that even though a strike would be authorized by the members, the union would not call for an employee strike/walkout of Ralphs, Vons and Albertsons, but instead would use the strike authorization as a bargaining chip in its negotiations with the three chains. Those negotiations are scheduled to resume next week and to continue over the next three -to- four weeks, according to union representatives and the three grocery chains.
No strike/walkout has been called by the UFCW.
The union officials hope the strike authorization provides them with some added leverage in the negotiations with the three supermarket chains, who want to reduce employee health care benefits (and expenses) and gain some other savings, as we laid out in our piece this morning.
The UFCW local officials we talked to today said no strike is planned for the immediate future. They also said the vote authorizing a strike is more than mere rhetoric; that it's a tool they will use if and when they feel it's needed.
In our early morning story we reported the three grocery chains said the union's holding a strike authorization vote was premature, since the old contract expired on March 6, 2011, and negotiations have only been going on in earnest for a few weeks.
Ralphs, Vons and Albertsons reiterated that position today in a joint statement, in which they said the authorization to strike is not only premature but, in their collective opinion, is essentially a diversion.
"Getting sidetracked by these tactics will only delay our ability to reach an agreement on a fair contract for our associates, the three grocery chains said in the joint statement. "The real work toward getting a fair contract will happen at the negotiating table and we hope that's where the union leadership will focus its attention."
As of today, here's where the grocery chains, the UFCW union-member grocery clerks and the union locals stand.
The union locals can now call a strike if they desire at any point in the negotiating process.
However, most members don't want that, as it means losing their regular paychecks from the supermarket chains for however long a strike might last. in 2007, the year the contract that expired on March 6 was ratified, negotiations between the union and the grocers took about seven weeks.
If the union does strike, the chains could fight back by locking out employees, which happened in Southern California in 2003. In a lockout the grocers hire non-union workers in an attempt to keep the stores open and sales flowing. In 2003 the retailers estimated they collectively lost about $1.5 billion because of the strike by UFCW members.
The presidents of the seven UFCW local also say the don't want to call strike, at present.
Ralphs, Vons and Albertsons are less than pleased about the strike authorization. They see it as premature and as a move by the union to play hardball early on in the negotiations.
The union local presidents, on the other hand, say the grocery chains have been stalling negotiations, so they needed to put an authorization to strike in the hip pockets of their negotiation suits.
Negotiations resume next week. Plans call for three -to- four weeks of intense negotiating, according to union officials and representatives of the three grocery chains.
If there there is a strike, the losers will be the grocery chains - lost sales and other problems - and the UFCW-member grocery store employees - lost wages, chance of losing a job, and more.
The winners: The numerous non-union food and grocery retailers in Southern California, which include the two largest retailers in the U.S. - Walmart and Target - along with Trader Joe's, Whole Foods Market, Sprouts Farmers Market, Tesco's Fresh & Easy Neighborhood Market and a number of others.
The UFCW locals in Southern California would like to unionize all of the chains listed above.
But, ironically, if the locals do call for a strike against Ralphs, Vons and Albertsons, which account for about half of all food and grocery sales in Southern California, they will be handing a nice piece of new business (added sales) to the very same non-union food retailers they would like to unionize, giving grocers like Fresh & Easy Neighborhood Market, which the UFCW is campaigning hard to unionize, a perfect argument as to why it should remain non-union.
That argument: Remaining non-union, among other advantages, allows it (and the others) to benefit from a strike against the 'big three chains, by gaining sales from an action (the strike) taken by the very union that (in Fresh & Easy Neighborhood Market's case specifically and particularly) wants and asks consumers not to shop at its stores because they're non-union.
This "Catch 22" scenario is something both parties - the UFCW union locals and the "big three" union chains - should think seriously about when negotiations resume next week.
We will be covering the negotiations closely. Stay tuned.
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