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The San Diego Union-Tribune reports that United Food and Commercial Workers (UFCW) negotiators for 65,000 Southern California supermarket employees of Ralphs, Safeway and Vons walked out of contract talks yesterday, terming the chains’ latest offer an insult. The move seems to bring the two sides close to an impasse that could result in a work stoppage, which would be the second in little more than three years.

“Essentially, they gave us a proposal that was totally regressive,” says Mike Shimpock, a UFCW spokesman. “Unless the markets want to get serious with us, we don't have anything to talk about. I'd like to say that there's not going to be a strike, but they are leaving us very little choice.”

Rick Icaza, president of UFCW Local 770, tells the Los Angeles Times, "What they are proposing is to pay less money for health insurance than they are paying now and to require employees to pay more," and he calls it "backwards bargaining."

And Shimpock tells the San Jose Mercury News, "There are not a lot of options available to us. If they don't want to deal with us, then we have few options other than striking or canceling the contract extension."

In a joint statement, the supermarket chains say that "the union has chosen to walk away from negotiations, ignore the federal mediator's request for a media blackout and engage in media stunts rather than productive negotiations…The issues being discussed in these negotiations are complex. To be successful, these negotiations require all parties to remain at the table and work toward solutions."

The last contract – which was arrived at after a more than four month strike/lockout three years ago – expired on March 5, though there have been two extensions while the two sides continued negotiating. At the present time, it is automatically renewed on a daily basis, and either side has to give 72 hours notice before calling a strike or instituting a lockout.

According to the Times, “Healthcare expenses have been the major sticking point in the negotiations. The supermarket chains are working to contain health and labor expenses so they can remain profitable as they face growing competition.

“According to union officials, the supermarkets proposed reducing their contributions to the trust fund that manages the workers' health insurance plans and increasing the amount of money employees pay.

“Union officials have made a priority of improving health benefits for the ‘second tier,’ the roughly 33,000 lower-paid workers hired by the three chains since 2004.

“Although the 32,000 veteran grocery workers still don't pay health insurance premiums and have low medical deductibles and co-payments, new hires must wait 12 to 18 months before they are eligible for health insurance.”

The Mercury News notes that “the two sides have not met face to face for about three weeks,” and instead, “they have been conducting shuttle negotiations, with each side meeting individually with the mediator.”
KC's View:
This is nuts. It may be gamesmanship, but these kinds of games seem likely to lead to disaster for both sides.

We still cannot imagine that the chains are willing to risk a strike, especially with the date of Tesco’s first store opening drawing closer.

We also have to wonder about the way the chains’ approach to health care is being characterized. Are they really looking to roll back coverage, or change the nature of coverage in the way that Safeway CEO Steve Burd keeps talking about?

Both sides should be careful here, and keep in mind the old proverb that goes something like, ‘You often meet your fate on the road you take to avoid it.”