Last grocery
strike's effects still felt
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Last grocery
strike's effects still felt |
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Fallout nags workers, consumers, companies
By Jennifer Davies
and Keith Darcé March 4, 2007 For Celeste Cook, the Southern California grocery strike of three years ago was so traumatic that she and her husband eventually left the industry and the state, moving to Arizona. Cook's voice quivers as she remembers the stress the 4½-month strike and lockout had on her marriage, her friendships and her children. The former wall deli manager blames it for the divorce of her brother, also a grocery worker. Cook, 43, said she was so angry at Ralphs, where both she and her husband had worked for a combined total of 43 years, that she refused to shop there after the strike. Even though she and her husband returned to work at Ralphs for about a year, he made sure to pack his lunch when he went back to work. “My husband wouldn't spend a dime at that store,” she said. The former Escondido resident's still-raw emotions are echoed by others who endured the grueling labor dispute. At least a quarter of the grocery workers did not return after the strike, according to the chains. For those who stayed, the experience has left them wary of another labor dispute. The contract covering 65,000 Albertsons, Ralphs and Vons employees represented by the United Food and Commercial Workers nears its end at midnight tomorrow.
The three chains, which account for more than 50 percent of the grocery business in Southern California, also struggled in the wake of the strike, losing an estimated $2 billion as customers found other places to shop. Although the companies have rebuilt much of their business since the strike, shopping patterns have changed fundamentally, making the traditionally competitive grocery business even more so. Neither side appears to want a repeat of that ugly battle. But they are nowhere close to coming up with a new contract. While there have been limited talks, the key issues remain health care costs, wage increases and eradication of a two-tier employee system that was adopted under the last contract. Under that system, those hired after the strike get paid less and qualify for benefits at a much slower pace. Even if the contract expires without a new deal in place, though, it does not mean there will be a strike or any other work stoppage. Negotiations could resume either with a contract extension or with the contract expired. Camilia Fulton, who works at a Ralphs in San Marcos and picketed full-time along with her husband during the last strike, said the union has promised that a strike is not in the offing. “They said they would not propose a strike as a first, second or even third option,” Fulton said. That has been welcome news to her, as the last strike pushed her and her husband to the brink financially. The only way they avoided real trouble was that the union made their mortgage payments and paid other bills for the last two months of the strike. “Thank goodness our marriage could handle that,” Fulton said.
Experts and industry watchers say both sides were wounded in the 2003-04 labor dispute, making the current talks challenging for the companies and the union. Edgardo Villanueva, senior vice president of Labor Relations Services, a management consulting firm in Newport Beach, said the union could be hurt by the fact that more than half its membership was hired after the strike. The new workers get paid less and therefore contribute less in union dues, Villanueva said, which could limit the union's financial resources to withstand another labor dispute. Also, Villanueva said, the union may be more reluctant than usual to call a strike because veteran workers are battle-weary, which would give the supermarket chains a distinct strategic advantage. “That kind of tips the scales to that side,” Villanueva said. But Mickey Kasparian, who heads Local 135, the UFCW chapter for San Diego and Imperial counties, said the union has spent the past 2½ years planning for these talks and is prepared to gain key concessions from the chains. Kasparian said that while the last strike affected the union's finances, it has recovered and is ready for any contingency. Andrew Wolf, who covers the grocery industry for BB&T Capital Markets, said the contract reached at the end of the strike was beneficial to the grocery chains' bottom lines, cutting their surging health care costs. “Their market share isn't back to what it was, but the two-tier (employee system) keeps them more profitable,” Wolf said. Harley Shaiken, a professor at the University of California Berkeley who specializes in labor issues, said the strike hampered the grocery chains in the negotiations that followed elsewhere. Instead of being able to repeat their success by implementing two-tier systems, the companies capitulated on key issues to avoid another damaging work stoppage, Shaiken said. In Northern California, for instance, the union members' health care costs did not increase significantly and a two-tier system was not implemented. While the grocery chains have recovered financially from the strike, with improved earnings, Shaiken said the losses of $2 billion hardly make sense. “Recovery now doesn't mean that they recovered what they lost,” he said. Instead of using the $2 billion on the strike, the companies could have invested that money in ways to grow their businesses, Shaiken said. The supermarket chains are cognizant of the fact that the last strike was a public relations nightmare that caused many customers to seek out other places to shop. Another strike could alienate customers after the supermarket chains worked hard to woo them back. Michelle Connell remembers having to cross through a “thick” picket line to shop at the Vons in University City during the strike. Connell stopped shopping there after she twice encountered police in front of the store. “That becomes a little bit overwhelming when you're trying to get through your daily errands,” she said. Connell returned to Vons within a couple of months of the strike's end, but she now divides her grocery bill among the other stores she patronized during the labor dispute. “I think (Vons) lost a lot of business during that period,” she said. “I've got friends who still haven't come back.” David Hirz, president of Ralphs, said surveys before the strike found that customers were aware of having three to four convenient shopping options. Now they put that number at seven or eight options, and rely less on the traditional supermarket for all their food needs. James Master, who works at the Ralphs in Point Loma, said he can't imagine there being another strike, saying the companies just can't afford it. “It would be very hard for them in terms of customer loyalty and employee loyalty,” Master said.
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Jennifer
Davies: (619) 293-1373;