Several US grocery retailers including Safeway are in talks with unions in North California in a bid to reach new contract agreements and avoid potentially damaging strikes.
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Safeway’s current contract with United Food and Commercial Workers (UFCW) union workers in the Bay Area expires this Saturday (11 September).
On the eve of negotiations, Safeway expressed hope for productive talks leading to a peaceful, constructive settlement. The company, hoping to avoid a costly labour dispute like the row in Southern California that began late last year and lasted more than four months, said that the grocery retail market had changed “dramatically”.
Competition from non-union, low-cost retailers has increased while health-care costs have also surged. Safeway said there are now 226 large non-union stores in Northern California operated by companies including Wal-Mart, Target and Costco.
“The challenges we face are real and cannot be ignored,” said Larree Renda, Safeway executive vice president.
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By GlobalDataLast year in Southern California, UFCW leaders called a strike over the issue of employee contributions to health coverage costs. The strike lasted more than four months and dented the earnings of grocers such as Safeway and Albertsons, which are still recovering.
However, some union representatives have vowed not to accept a similar agreement to the one that eventually ended the Southern California strike. In that case the agreement protected existing workers but allowed the retailers to lower wages for new employees, reported Reuters.
Ron Lind, a spokesman for eight local unions representing 30,000 San Francisco-area workers, said the high turnover rate in the grocery industry would end up leaving most employees with lower wages and benefits.
“The Southern California agreement will not fly in the Bay Area, nothing even close to it will,” Lind was quoted by Reuters as saying. “The negotiations are going to be tough, contentious and complicated.”
