Almost a year after the three major supermarket chains and their unionized workers called a bitter truce to the most protracted labor dispute in recent Southern California history, a clear winner has finally emerged.
It is the San Francisco grocery worker.
The strike and lockout, which began in October 2003 and ended in March, cost the chains dearly. Some analysts estimate that the owners of Vons, Ralphs and Albertsons lost close to $3 billion in sales during the work stoppage and its aftermath
Likewise, the Southern California locals of the United Food and Commercial Workers took a beating. Their coffers were drained by months of strike pay, and the eventual agreement increased the workers' share of health costs, and created a two-tiered pay system that leaves newly hired workers with permanently lower wages and benefits.
Bay Area unions, after watching this carnage from a safe distance, last week were able to secure a three-year contract for 30,000 workers that does not significantly increase worker contributions to health insurance and keeps the companies from creating two classes of workers.
The deal is similar to one ratified three weeks ago by UFCW locals representing 16,000 workers from Sacramento to the Oregon border. The Sacramento contract also saves workers from a two-tier pay scale, but does require workers to pay medical deductibles for the first time.
Industry analysts and labor experts say both contracts are victories for the union, victories that wouldn't have been possible without the sacrifices made by their Southern California counterparts.
"The extent of the struggle in the south paid off for the union in Northern California," said Harley Shaiken, a professor at the University of California Berkeley who specializes in labor issues. "The cost of the strike to the companies is being reflected in how they negotiate elsewhere."
Beyond the advantages of facing a weakened opponent, the Bay Area locals were able to learn from mistakes made by their southern colleagues. One criticism levied against the Southern California locals was that they approached the dispute as a regional fight, while the companies had a national strategy.
In contrast, the Bay Area locals held several rallies early in the negotiating process and helped organize nationwide pledges to boycott the chains in the event of a work stoppage.
"The lesson we learned from Southern California was that these companies could take us on on a regional basis for a long time," said Ron Lind, president of UFCW Local 428 in the Bay Area. "So our strategy was to put as much pressure on the companies as possible while the members were still earning a paycheck."
Mickey Kasparian, president of the San Diego UFCW chapter, did not return calls seeking comment.
Representatives for the chains largely declined to comment beyond their prepared statements issued after the tentative agreement in the Bay Area.
"Every contract negotiation is separate, each with its own separate set of issues," said Ralphs spokesman Terry O'Neil. "So you can't compare one set of negotiations with another."
Experts say the settlements this month are clear evidence that the chains have significantly scaled back their plans to roll back wages and benefits as labor contracts come due nationwide.
"The grocery chains prevailed in getting what they wanted in Southern California," said George Whalin, president of Retail Management Consultants in San Marcos. "But they failed in their larger strategy, which was to implement a two-tiered system across the country."
Kent Wong, director of the UCLA Center for Labor Research and Education, called the strike "a public relations disaster" for the companies.
"Management across the country has looked at what happened in Southern California, and decided that it is not something they want to repeat," he said.
The work stoppage drained hundreds of millions of dollars in profit from the three companies, leaving them little room for further miscalculations, analysts say.
They couldn't, for example, afford to lose any more ground image-wise with the public. One poll, during the heat of the Southern California conflict, showed that 59 percent of shoppers were honoring the store boycotts urged by the union.
In hindsight, the chains' biggest mistake may have been their decision to defray the costs of the strike and lockout by entering into a revenue-sharing agreement. The move drew a lawsuit from California Attorney General Bill Lockyer and did not sit well with the public.
"The whole profit-sharing deal was very suspect," Whalin said. "No one really trusted them after that."
Whalin also said the chains generally did a poor job of explaining the competitive pressures they face from Wal-Mart and Target, two discount retailers that sell groceries in "superstores."
But the chains will continue trying to cut wages and benefits in every union contract, the experts agree.
This is why few are willing to bet that the Southern California UFCW locals will be able to eliminate the two-tiered system when their contract expires in 2007.
Even union leaders, who say there is "no higher priority" than getting rid of the two-tier system, admit that it will be an uphill battle. Safeway, owner of the Vons chain, has already made attempts to trim the higher of the two tiers by proposing a buyout plan to some of its higher-priced workers.
This reality remains hard to swallow for many San Diego grocery workers who realize that others will gain from their struggles. Some say their union leaders let them down.
"We were the sacrificial lambs," said Ross Bagnasco, a checker at the Albertsons on University and Fairmont avenues. "With the current local leadership I seriously doubt we can get back what we gave up."
Posted by UFCW 227 at January 30, 2005 02:44 PM