The strike of 70,000 Southern California retail food workers, which started on October 11, may be the first in a series of battles that could ultimately shape the future of labor-management relations throughout the United States.
The United Food and Commercial Workers (UFCW), one of the nation’s largest private-sector unions, has geared up for what could be a prolonged job action. “If they break our backs here,” noted Sean Harrigan, UFCW States Council director, “they [employers] will view this as an opportunity to pillage UFCW members and their union contracts throughout the country. This is a real watershed.” The last strike in the Los Angeles retail food industry occurred twenty-five years ago.
The employers–Vons and Pavillions, Ralphs and Albertsons–want to slash the health and retirement benefits of their cashiers, baggers, deli clerks and other employees. The companies’ representatives refused to discuss the details of their contract proposals, but according to UFCW Local 770, the grocery chains have demanded what amounts to a 50 percent reduction in workers’ medical coverage, including increased prescription drug costs and cuts in retirement benefits. Additionally, the companies want to initiate a “second-class” wage system, with new hires doing the same work as current employees but for much lower pay.
The companies claim that high labor costs make it impossible for them to effectively compete with nonunion stores like Wal-Mart, but a quick look through the public records shows all three companies to be highly profitable: The Cincinnati-based Kroger Co., which owns Ralphs, is the nation’s eighteenth-largest company, with revenues of more than $51 billion. Albertson’s, Inc. based in Idaho, ranks thirty-fifth, with revenues of $36 billion. Safeway, which owns Vons and Pavillions, and is based in Pleasanton, California, ranks forty-first, with revenues of $32 billion. The three chains’ combined operating profits increased from $5.1 billion in 1998 to $9.7 billion last year.
More than 11,000 members of UFCW Local 770 (which represents food workers in the Los Angeles area) showed up at a rally two weeks ago. More than 97 percent of them voted to reject the company’s offer–an incredible show of solidarity. Local 770 president Rick Icaza remarked after the vote that “In my decades of work for the union I have never seen an employer offer so soundly rejected.” “I’m absolutely convinced,” Icaza added, “that this is really a start of greater worker militancy.”
A few days later, the LA City Council unanimously voted to support the strikers. In fact, the UFCW can expect a great deal of support from both local and statewide Democratic leaders. Elected officials have often helped mediate labor-employer tensions so they didn’t spiral into destructive battles. But with the recall of California Governor Gray Davis, speculates UFCW’s Icaza, “Employers may feel stronger because there won’t be a pro-labor governor breathing down their necks.”
From labor’s perspective, the national food chains’ demands for draconian cuts reflect a profoundly altered corporate attitude. When local billionaire Ron Burkle, philanthropist and Democratic Party contributor, owned Ralphs before selling the company in 1998, labor negotiations were characterized by an attempt to solve problems rather than defeat the “opponent.” “It was a win-win situation with Burkle,” the UFCW’s Harrigan says. “Now it’s win-lose.”