Business & Economy

Grocery chains, union dig in on health benefits

Grocery store workers lead a rally on June 14, 2011 to demand a
Grocery store workers lead a rally on June 14, 2011 to demand a "fair and timely" contract from the major stores.

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Union employees at local Ralphs, Vons, and Albertsons supermarkets have been working on an expired contract since March. They’ve voted to authorize a strike if their leaders decide it’s necessary — and they’ve staged rallies to demonstrate their resolve. But the grocery chains have dug in, too. The two sides remain far apart on the issue of health benefits.

Here’s one thing the union and the employers agree on: the cost of health care has gone up and is going up. What they can’t agree on is who should pay for it. Mike Shimpock, spokesman for the United Food and Commercial Workers Union Local 770 says as health care costs have risen, the grocery chains have shouldered less of the burden, while the workers pay more.

"It’s taken out of hourly wages," Shimpock said as he marched recently with hundreds of grocery store workers and supporters to Vons' Southern California headquarters in Arcadia. "We’ve paid for every increase over the last 10 years, and now these highly profitable companies, who make billions of dollars a year, what they’re trying to do is finally shift almost all of it over to these people that are working day in and day out just to make ends meet. "

But the view from inside Vons headquarters was different.

"The initial proposal the employers put out has the employers paying more tomorrow than they do today," said Vons spokesman Daymond Rice. "So by definition that is not a cost shift. The employers will always continue to pay the lion share of the health care benefits. What we need is modest cost sharing."

The employers — that is, the three big grocery chains — want workers hired since 2004 to pay more for health care. They want to raise the worker contribution for individual health coverage from$7 a week to $9. For family coverage, the worker contribution would jump from $15 a week to $23.

It might sound like just a few dollars more, but not to the United Food and Commercial Workers Union. Add the increases to rising premiums, deductibles, and out of pocket maximums, and the union estimates some workers could fork over almost half their take-home pay for health coverage. It’s holding out for a better deal.

Vons spokesman Daymond Rice said the counterproposal the union had submitted the day before actually asked for health care benefit improvements.

"Improvements, you know, in this day and age, in this health care cost environment, that’s just not realistic," Rice said. "So they need to put forth a proposal that can help find solutions to these issues."

Mike Shimpock of the United Food and Commercial Workers Union said the workers aren’t really looking for improvements.

"We only want to maintain what we have," Shimpock said. "We’re grateful for what we have, and we’re willing to pay to maintain those benefits. But if they make those benefits so expensive that people can’t afford them, and it’ll force people onto welfare, it’ll force people to drop their health care and they won’t be able to take their kids to the doctor. That’s unacceptable to us.

A walkout or a lockout requires three days notice. The last labor action on the supermarket front happened nearly eight years ago: a walkout, say the grocery chains; a lockout, say the workers. Whatever it was, it lasted five long months, right through the holiday season. With Ralphs, Vons and Albertsons crippled, shoppers spent their money at two well-stocked local chain that the union didn't picket: Stater Bros. and Gelson’s.

The big supermarkets also lost business to Costco, Smart & Final and other warehouse stores. Parking lots at Trader Joe's got a little more crowded, too.

Now there are even more alternatives for Southland grocery shoppers, from British-based Tesco markets to 99 Cent Only stores with deli and produce aisles, to Target stores that sell meat, poultry and fresh produce.

That longer list of grocery store options might push the supermarkets and their workers to do what they couldn’t do eight years ago: Get a deal done.