Food Retailers Face More Pressure Over Pay

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Food Retailers Face More Pressure Over Pay

By Thad Rueter - 01/28/2021
Food Retailers Face More Pressure over Pay
Earlier in the pandemic, such food retailers as Kroger and Walmart voluntarily offered their workers more pay, though many of those programs have since expired.

The pressure is building for larger food retailers to pay their workers more during the pandemic.

The Seattle City Council in an 8-0 vote recently approved a measure mandating an extra $4 per hour for employees of grocery operators with more than 500 workers worldwide, and for locations of at least 100,000 square feet. The measure does not apply to convenience stores or farmers’ markets. Food retailers would have to pay that premium for as long as the city remains in a pandemic emergency — which has been the case since March.

In Los Angeles, meanwhile, the "City Council’s Economic Development and Jobs Committee on Tuesday, Jan. 26, unanimously directed the city attorney’s office to draft an emergency ordinance that would require grocery stores with more than 300 employees nationwide to provide the 'hero pay” to workers,'" according to the Daily News. “The ordinance, if it gets through that committee and the full council, would provide grocery store workers in Los Angeles with an additional $5 an hour for 120 days.”

As such measures advance, the challenges they pose to the larger grocery operators targeted by the pay plans was recently expressed by the California Grocers Association, which represents more than 300 retailers, as it filed a lawsuit asking a federal court in Los Angeles to invalidate the law. It’s also seeking a preliminary injunction to stop the city from implementing it, CGA said.

In a statement to Progressive Grocer on Jan. 21, CGA President Ron Fong said "grocery store workers are front-line heroes, and that’s why grocers have already undertaken a massive effort to institute measures to make both workers and customers safer in stores. But this ordinance is clearly illegal in that it interferes with the collective-bargaining process and singles out only certain grocers while ignoring other retail workers and workers in other industries providing essential services during the pandemic.”

As well, he continued, such pay measures would result in “higher grocery prices and severely limit store viability — resulting in limited store operating hours, reduced hours for employees, fewer employment opportunities, and most concerning, possible store closures. These negative impacts would be felt most acutely by customers and workers in low-income and disadvantaged communities.” 

On Thursday, the CGA went further.

It said that a new study found that extra pay mandates of up to $5.00/hour for grocery workers could raise consumer grocery prices by about $400 annually for the typical family of four. Alternatively, if grocers were forced to find offsetting savings in operational costs, it would mean a 22% across-the-board reduction in work hours, hurting the very workers these proposals aim to help, according to the CGA. 

Earlier in the pandemic, such food retailers as Kroger and Walmart voluntarily offered their workers more pay, though many of those programs have since expired.