A spokeswoman for the chains – Albertsons, Ralphs and Vons – said they had agreed with the United Food and Commercial Workers union on one of the key issues in their negotiations for a new contract: eligibility for health benefits.

Under the previous agreement, reached three years ago after a 4½-month strike and lockout, newly hired workers became eligible for health insurance after 12 to 18 months on the job. The grocers' spokeswoman, Adena Tessler, said the companies have agreed to cut the wait time to six months.

But Mickey Kasparian, who heads Local 135 of the UFCW, which includes San Diego and Imperial counties, said the two sides still have major differences over funding levels for the health care plan.

“Until we fund it properly, nothing is agreed upon,” Kasparian said. “It's like remodeling a house and having all these wonderful plans but not having the money to pay for it.”

He speculated that reports of a deal in yesterday's Los Angeles Times were a tactic by the grocery companies to lull union members into a false sense of security as the talks drag on.

“We have been in negotiations on this contract for five months, and we have made very little progress,” Kasparian said.

The contract covers more than 65,000 workers, and the three chains account for more than 50 percent of the grocery business in Southern California.

In dispute is how much of a jointly operated health care trust fund should be used to pay for rising health care costs. The fund now has about $500 million, and the union is willing to use about half of the reserves, Kasparian said, but the grocery store chains want to draw on a larger portion of the fund.

That means the fund could be close to insolvency by the third year, and employees would face either higher premiums or reduced benefits, Kasparian said. The union said similar proposals have resulted in grocery workers' health care plans facing bankruptcy in Texas, Indiana, Louisiana, Arkansas and Oregon.

Tessler, the grocers' spokeswoman, said the companies' actuarial consultants are confident that the amount of money the supermarkets want to use will not bankrupt the health care fund.

She acknowledged that issues remain with regard to the health benefits but said “a lot of progress has been made.”

In addition to the reduced wait time for employees, children of employees would qualify for health insurance in six months, Tessler said. Currently, it takes 30 months before a grocery worker is eligible for family coverage. Tessler also said that newer employees would get improved health care coverage and that there would be greater incentives for preventive care.

The reduction of wait times and improved coverage for new hires would be a significant victory for the union.

To help end the prolonged dispute of 3½ years ago, the UFCW agreed to a two-tier system whereby new hires would be paid less and have to work longer to qualify for benefits. That system had resulted in the majority of new hires going without health insurance. A study by the University of California Berkeley Center for Labor Research and Education found that just 7 percent of the new hires had health care coverage through the supermarkets.

Aside from health care benefits, the two sides also need to agree on wage increases. Grocery workers have not had a boost in pay since 2002.