By Penni Crabtree
San Diego Union-Tribune
July 17, 2007
Talks are progressing; no breakthroughs yet
Marathon bargaining sessions continued yesterday between three supermarket chains and the union that represents 65,000 Southern California grocery workers, after “significant” progress in contract negotiations, according to those close to the talks.
But contentious issues remain in the areas of wage increases and funding improvements in health insurance coverage, a spokesman for the United Food and Commercial Workers union said yesterday.
“We've talked through the weekend and we're still at the table, but we are not there on wages and haven't even talked about health care funding,” said Mike Shimpock, spokesman for the union. “We will stay at the table as long as we are making progress, and we feel we are making progress now.”
Shimpock said the two sides found common ground on pension and some wage issues over the weekend. A spokeswoman for the supermarket companies said talks are continuing on a “day-to-day basis” but declined to discuss any details.
“The companies' position is that the substance of what is discussed belongs at the negotiating table,” spokeswoman Adena Tessler said. “Nothing has changed as far as the companies' commitment to negotiating a contract.”
The union sounded a more hopeful note yesterday than it did a week ago, when it threatened to cancel a temporary agreement that has kept workers at Albertsons, Ralphs and Vons from going on strike. The labor contract expired March 5, but both sides have agreed to continue it on a rolling basis while negotiations take place.
Both sides want to avoid a repeat of the 141-day strike and lockout in 2003-04 that inconvenienced shoppers, idled workers and cost the grocery chains millions of dollars.
That strike ended with a contract that created a two-tier system for wages and benefits. Newly hired employees don't enjoy the same wages or benefits as those hired under previous contracts. Such new hires now account for about half of the grocery industry work force.
This time around, the union is trying to undo some of the concessions made in the last contract, including provisions that increased waiting periods for health care benefits to 30 months for family coverage.
Shimpock said that of 44,000 grocery workers hired since the 2004 contract, only 80 have health insurance for their children. Less than 30 percent qualify under eligibility rules, and many who do qualify can't afford it, he said.
“We think it's outrageous that it takes up to three years for workers to get their children health care coverage,” Shimpock said.
The union wants to shorten health care eligibility to six months. A key sticking point is how much of a jointly operated fund should be used to pay for health care coverage. The union is willing to use about $250 million of the $500 million reserves, while the chains want as much as $350 million used, according to labor officials.
Outside labor observers said the grocery chains are also having to grapple with the fallout of the 2004 contract, including a higher-than-expected turnover of employees.
British retailer Tesco's announcement that it will open as many as 100 stores in Southern California, Arizona and Las Vegas – at least seven of them in San Diego County – also increases the pressure on the grocery chains. Tesco has built a reputation, and $80 billion in annual sales worldwide, in part on its emphasis on customer service.
“The grocery companies are facing Tesco coming in, and Vons is really trying to go for the upscale market, where service and employee turnover matters,” said Ken Jacobs, chairman of the UC Berkeley Center for Labor Research and Education. “The level of turnover since the 2004 contract has really had an impact, and it is in the chains' interest to solve this in a way that improves conditions for the workers.”
Jacobs said negotiations between the two sides have “come down to the wire.”
“As you get close to the end and everyone wants a deal, there is final leveraging to get the agreement to go your way,” Jacobs said. “These things tend to take on a life of their own. Everything can go forward, or it can break down.”
