Union workers vs. King Soopers, Safeway and Albertsons.
Who is winning these contract negotiations? Wal-Mart.
"Always Low Prices." Stack it high, let it fly. No pesky union here.
Wal-Mart's foray into groceries has only just begun. The Bentonville, Ark.-based retailer is building 240 to 250 grocery-selling Supercenters per year.
In Colorado, it plans to open seven more in the next year. A new Sam's Club opened Thursday at the new Southlands center in southeast Aurora.
Other grocers are building new stores, too. What's alarming is that Wal-Mart didn't start out selling food, but it has quickly supplanted Albertsons as Colorado's third-largest grocer. Wherever Wal-Mart builds a Supercenter, every grocery store within 5 miles loses 20 percent of its business, according to King Soopers, Safeway and Albertsons.
To preserve profits, these three grocers must cut costs. They've asked union workers to contribute toward health care benefits that now come free.
That's not the most creative solution, but it is in line with an unfortunate trend. Health care insurers keep jacking rates, and employers are passing higher premiums onto employees. The grocery workers, however, are saying no.
Talks between grocery chains and the United Food and Commercial Workers now are on hold for several days as grocers prepare a final offer. If the United Food and Commercial Workers strike, they will only hurt the companies that tolerate them. Their picket lines would send customers to Wal-Mart, Target, Costco, Kmart, Whole Foods, Wild Oats and other nonunion grocery stores.
If the UFCW wanted to be effective, it would organize at Wal-Mart, sacking the world's largest company with the same labor costs that others pay.
"There's no question that if a union organized Wal-Mart employees, Wal-Mart wouldn't be able to charge the prices it does," said Cindi Fukami, a management professor at the University of Denver's Daniels College of Business. "The union wage premium is anywhere from 10 percent to 15 percent."
Unfortunately, UFCW has proven no match for Wal-Mart.
"Once Wal-Mart gets wind of us, they have this flying anti-union crisis team that comes in from Arkansas and immediately starts to drop the hammer," said union spokesman Dave Minshall.
Wal-Mart has been accused of confiscating union materials, spying on pro-union employees and illegally firing workers for union rabble-rousing.
Wal-Mart usually prevails. Union influence has been declining for decades, and the Bush administration isn't sympathetic to union claims.
When 10 Wal-Mart meat cutters legally joined the UFCW in 2000 at a store in Jacksonville, Texas, Wal-Mart announced that it would no longer use meat cutters. It now sells only pre-packed meats in all of its stores.
Wal-Mart officials called the timing of that announcement a coincidence. They've successfully argued there is no need for a union because they believe they treat their employees well.
The only union Wal-Mart in North America is in Jonquière, Québec, Canada. Wal-Mart recently complained about it in a news release: "The Jonquière store is not meeting its business plan, and the company is concerned about the economic viability of the store." We'll see if that store lasts.
If the UFCW can't infiltrate Wal-Mart, it should help King Soopers, Safeway, Albertsons and other union grocers compete with Wal-Mart. That might mean a painful concession. So far, the union doesn't seem prepared for that.
"King Soopers, Safeway and Albertsons could find some real savings besides the obvious one, which is cracking down on the workers," Minshall said. "You don't have to be like Wal-Mart to compete with Wal-Mart."
Maybe. But for now, America seems obsessed with "Always Low Prices. Always." Given that trend, it's not King Soopers, Safeway and Albertsons taking paid health-care benefits away from union grocery stores. It's Wal-Mart and everyone who shops there.
Some call that a bargain. Yet, when workers can't afford health insurance, we all end up paying for them anyway.
Posted by UFCW 227 at October 15, 2004 03:45 PM