These cities want to give employees of supermarkets a risk benefit

Seattle and two California cities, Long Beach and Montebello, have passed laws requiring supermarkets, including chains such as Kroger (KR), Albertsons, Whole Foods and Trader Joe’s, give their employees $ 4 extra per hour in risk compensation. The measure in Montebello also requires drug stores such as CVS (CVS) and Walgreens (WBA) to put employees at risk.

Union officials, labor experts and local officials say cities are stepping in where the federal government and private sector fall short. They hope the measures will put more pressure on major grocers to restore the peril payment in their stores across the country and spur other cities into similar legislation.

The United Food and Commercial Workers Union, which represents 1.3 million workers in the grocery, meat packaging and food industries, says that at least 134 grocery workers have died from the coronavirus and thousands have been infected.

“We are seeing an increase in food purchases in supermarkets. But we have not seen a commensurate increase in wages … for those putting themselves at risk,” said Teresa Mosqueda, Seattle City Councilor who introduced the city’s measure. an interview. “What we’ve seen is a slowdown in vaccination, with front-line workers becoming more exposed and incurring Covid.”

Industry groups are against such mandates. Ronald Fong, president of the California Grocery Association, said in an interview that the measures taken by cities will have “unintended consequences.”

“Grocers will have to raise consumer product prices to do these increases, or cut shifts to make payroll,” he predicted.

Two large chains have made different moves in the past week.

On Tuesday, trader Joe’s said it temporarily increased all of its employee wages to an extra $ 4 an hour, compared to the extra $ 2 an hour they received for working in the pandemic. However, trader Joe’s is waiving planned mid-year increases for employees, according to a person familiar with the company’s decision.

Earlier this week, Ralphs and Food 4 Less, which are owned by Kroger, announced that they would be closing two stores in Long Beach. A Kroger spokesperson said the stores were struggling and the closures were a result of the Long Beach City Council’s “misguided decision” to “pick winners and losers” and demand a risk payment for supermarkets in the city, but not for large retailers.

“Kroger’s decision is unfortunate for employees, shoppers and the company,” Kevin Lee, a Long Beach spokesperson, said in a statement.

A ‘big’ bump

Other measures to pay for risks are in the works. There are proposals in California cities, ranging from Los Angeles to Berkeley, to pay $ 4 or $ 5 extra to grocers.

But many of the mandates do not involve employees at the largest retailers in the country. Most measures target stores that primarily sell food, so major retailers such as Walmart and Target that sell food and a wide variety of goods are excluded. In addition, those chains do not have stores in some cities where laws have been passed or proposed, and thus are not affected. (Los Angeles, where a bill covers not only grocery stores, but also drugstores and major checkout chains, is an exception).

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Despite some of the largest retail employers not being covered by the mandates, the $ 4 and $ 5 risk premiums are “significant” and will have an “immediate, positive impact on the region’s grocers,” said Molly Kinder, a fellow at the Brookings Institution think tank, who wrote a report in November on employee compensation at top retailers during the pandemic. For employees, risk compensation will also have a “positive psychological benefit from being recognized for the value of their work and their sacrifices,” she said.

She predicts that efforts in cities in Seattle and California will result in more cities and counties across the country mandating risk payment for grocery workers. But she doesn’t expect Congress to pass similar legislation requiring risk payment for grocery workers.

The momentum in cities for risk paying comes months after it ended for most grocery workers. In the early stages of the pandemic, major grocers such as Amazon-owned Kroger, Albertsons and Whole Foods and Rite Aid offered their employees an additional $ 2 risk cost for showing up for work. Other chains, such as Walmart, CVS and Walgreens, offered cash bonuses for their employees in lieu of risk compensation. Hazard pay in those stores ended over the summer, and since then many chains have been giving their employees extra rounds of cash bonuses.

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