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The United Food and Commercial Workers (UFCW) has terminated the contract extension with Albertsons, Safeway and Kroger’s Ralphs, putting in place a deadline of Sunday, December 19, for a deal to be reached. If a deal is not made, the UFCW said, a strike vote would be called.

Of course, it remains possible that the three chains could lock out its unionized employees before any strike is called.

In a prepared statement, UFCW 588-Northern California President Jack L. Loveall said, “We are committed to maintaining the finest supermarket contract in the industry. That means no employee-paid premiums for health care. That means no permanent two-tier system of wages or benefits.”

This statement would appear to suggest that the Northern California union is unwilling to accept some of the compromises reached in Southern California after a more than four-month strike/lockout. The chains’ management teams have been resolute in saying that they needed to shift some of the burden of health care benefits to the employees and move to tiered wages if they are to become competitive with non-unionized operations such as Wal-Mart.

Loveall said that after five months of negotiations, “the time for a decision is now. We must end this period of limbo and maximize our ability to achieve the best possible contract while addressing the competitive situation in the supermarket industry.”

Contract extensions are still in place with Bel-Air, Nob Hill, Raley's, Save Mart and other independent markets.
KC's View:
Deck the halls with sounds of folly…

We could be wrong about this, but issuing ultimatums doesn’t seem like the best way of reaching accord. And doing so during the height of the holiday shopping season seems likely only to increase tensions and mistrust between the parties.

We’ve thought for a while that the Northern California situation seemed destined not to end easily or well for either side. But we would make on observation…

We saw yesterday on an industry site a lot of discussion about the unions needing to capitulate in order to avoid the debacle of Southern California. That struck us as a predictably management-centric view of the situation, and one that does not address the need for compromise by both sides.

Too many of these management-labor disputes end up being about old battles being re-fought, without any concession by either side that some sort of new relationship needs to be forged that will help both management and labor cope with a new reality.

Ironically, the Los Angeles Times reports this morning that “nearly 10 months after the end of the bitter Southern California grocery strike and lockout, the three chains and the union that waged the longest labor standoff in U.S. supermarket history are still in turmoil. Profits at Albertsons, Safeway-owned Vons and Pavilions stores, and Kroger-owned Ralphs are being pinched by the price cuts they've made to woo shoppers alienated by the four-month-long dispute. All three companies' stocks have fallen since a new contract was signed in February.”

The sounds of folly, indeed…