Portland grocery, meat contracts ratified

Grocery workers, meatcutters and central checkout clerks at Portland-area supermarkets represented by United Food and Commercial Workers (UFCW) Local 555 ratified a new five-year contract Nov. 2 with 85 percent approval. There are approximately 5,500 union employees covered under the pact.

“We once again fended off the two-tier system that has continually been pushed by Food Employers Inc., [the association that bargains for Albertsons, Safeway and Fred Meyer stores],” said Local 555 President Gene Pronovost. “We have four contracts — none with a tiered system. That is what they’re striking over throughout the country.”

More than 80,000 grocery workers are on strike or locked out this week at stores in Southern California, West Virginia and Kentucky. Another 10,000 grocery workers were on strike or locked out in St. Louis for more than a week before coming to terms on a new agreement.

UFCW locals in Southern California launched a strike Oct. 11 against Vons and Pavilions stores, both owned by Safeway Inc. The next day, Albertsons and Kroger Co.’s Ralphs stores locked out their union employees. In all, 70,000 workers at 859 stores throughout Southern California and parts of Central California are affected.

Union officials in California said the grocery chains are demanding what amounts to a 75 percent cut in health coverage for new workers and a 50 percent cut for current ones. Another key issue in California is unfunded pension liabilities to the tune of more than $1 billion.

The situation is not so dire in Portland, although Food Employer Inc. entered negotiations demanding tiered wages and fringe benefits. A two-tiered structure grandfathers current union employees at previous higher wage and benefit rates while subjecting all new hires to a lower rate, with no opportunity of ever catching up.

Portland area grocery workers ratified a five-year contract that provides for pension increases, family health insurance coverage and some wage increases.

All sectors of meat, grocery and central checkout (Fred Meyer) will receive pension increases of 12 cents an hour each year over the life of the contract, said John Etten, director of collective bargaining for Local 555. In addition, employers agreed to attempt to merge the Butchers Trust and Retail Trust into a single plan. “Each trust has its own set of issues,” Etten said. “Merging the two stabilizes the situation and will benefit both trusts. There will be a slight reduction in future benefits, but it’s still a win-win for everyone involved.”

The new pension language also impacts union grocery workers statewide, even though they operate under separate but similar collective bargaining agreements based on their location in the state.

Pension issues in contracts in Eugene/Springfield, Salem and the Willamette Valley, and along the Oregon Coast all were deferred to the outcome of the Portland negotiations. There are about 5,000 union members at Fred Meyer, Albertsons and Safeway stores in Eugene, Springfield, Salem, Albany, Corvallis, Lebanon, Sweet Home, Coos Bay, North Bend, Florence, Lincoln City and Newport.

Likewise, in keeping pattern with previous Local 555 contract settlements, Portland-area union members agreed to begin sharing in the cost of health insurance premiums if they increase more than 8 percent a year. Any costs above that will be split evenly between employees and their employers. The level of health care coverage decreased from 90 percent to 80 percent for current employees — which means that for every $100 spent, the health plan will cover $80.

New hires will receive a progressive health benefits package starting at 50 percent premium coverage and progressing to 80 percent after one year of employment. Dental and vision coverage will be added to the benefits package of new hires after 24 months on the job.

Etten said initially employers wanted to create a separate benefit trust for new hires — a true two-tiered system. “That was a huge issue that we were able to beat back,” he said.

The contract includes a package of “hard money and soft money” raises, Etten said. All journey-level employees will receive two 25-cent-an-hour raises (hard money) — the first one coming in May 2004 and the second scheduled for May 2006. Top scale meatcutters will earn $17.64 an hour, and top scale clerks will earn $15.20 an hour.

Additionally, lump-sum bonuses (soft money) ranging from 15 cents to 25 cents for all hours worked will be spread out over the length of the contract. The first bonus is retroactive to July 29, 2003 (when the previous contract expired) and includes all employees.

Only journey-level employees, those with two-and-a-half years or more experience, will be eligible for future raises and bonuses.

The contract will lengthen the time it takes for employees to reach journey-level status from two and a half years to nearly four years.

The contract also contains language for dues checkoff. Previously, dues checkoff was available under a “letter of understanding” between employers and the union. Now it’s a contractual obligation.

“It’s not the best contract ever, but we stopped the two-tiered structure, we kept our health care coverage and worked out some pension problems,” Etten said. “We will go forward from here.”

Not a part of these negotiations were grocers such as Haggen, QFC, Zupan, Wiser and some independents stores. All are expected to sign “me-too” agreements by the end of the month.

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