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Which side won in new grocery contracts?
UFCW member DARRIN HOOP takes a closer look at new contracts that the union and grocery corporations both say will help workers forced to bear the brunt of rising health care costs.
ON OCTOBER 12, 2003, some 59,000 grocery workers, members of seven Southern California locals of the UFCW, began a 141-day strike against the “Big Three” grocery chains: Kroger (Ralph’s in California), Safeway (Vons) and Albertsons (which was bought by Supervalu in 2006).
Despite impressive solidarity from organized labor and the community, the strike was settled with a devastating contract that implemented a two-tier system under which wages and health benefits for new hires were significantly less than for the existing workforce.
“The contract increased waiting periods from four months to 12 months for individual (health care) coverage (18 months for clerks) and 30 months for family coverage,” according to a study by the University of California-Berkeley Center for Labor Research and Education. “It increased co-pays, co-insurance and deductibles under the new plan, while restricting options.”
This concessionary contract in Southern California became the model for the rest of the grocery industry in subsequent negotiations and set the stage for this year’s agreements.
Since then, the UFCW prepared for its 2007 round of grocery contracts--covering 328,000 workers nationally--with a series of union mergers and promises to members that gains would be made this time, especially regarding health care.
The first results of this strategy can be seen in two large grocery contracts in Southern California and the Puget Sound region in Washington.
UFCW spokeswoman Sandra Lloyd-Jones called the Southern California agreement, which was ratified on July 23, “a huge victory for grocery workers.” Dave Schmitz, president of UFCW Local 21, the biggest of the three UFCW locals to ratify the Puget Sound deal on August 28, said, “From the beginning, we set very clear goals. We met those goals--and more--without taking any steps backward.”
In fact, while there are improvements from the last concessionary contracts, there’s more to the story.
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THE 2007 agreements still leave wages for UFCW members lagging behind in comparison to the contracts that expired in 2003 and 2004. According to union estimates, it will still take six to nine years for new hires to reach the top pay scale under the Southern California contract, despite the elimination of the two-tier system.
To sell the new contracts in Puget Sound and Southern California, the UFCW trumpeted supposed gains in health care.
In both agreements, preventive health care is covered at 100 percent for procedures such as well-adult and well-child checkups, immunizations, flu shots, mammograms, colonoscopies, pap smears and other screening tests. No deductibles or charges of any kind will be attached to these services.
In the Puget Sound deal, a $5 million “wellness incentive” program was set up. Initially, the program will provide a cash incentive of $50 to workers who agree to a “personal health assessment” designed to identify potential medical problems. There will be “financial assistance” to workers who want to quit smoking or who are willing to begin a “weight management regimen.”
The most controversial aspect of the two contracts is the adoption of a “Health Reimbursement Account (HRA).” According to Safeway spokesman Kevin Herglotz, the Southern California contract marks the first time an HRA has appeared in any grocery contract in the country.
Under the HRA, workers will have an annual allowance of $500 for an individual and $1,000 for a family, which can be used to pay for doctor’s visits, lab tests, X-rays or any other covered medical expenses, without deductibles being charged. However, the allowance can’t be used for prescription, dental and vision benefits, nor to pay health insurance premiums.
After the allowance is used up, workers pay all costs out of pocket, until the annual maximum is reached, and the plan kicks in from that point on.
Unfortunately, health benefits are still two-tiered. Under Plan A, which applies to those hired before August 15, 2004, office visit co-pays have been eliminated. The deductible is $150, with the company covering 85 percent of the coinsurance and workers 15 percent, with an out-of-pocket maximum of $1,000 a year.
Workers in the Plan B category (those hired after August 15, 2004) still have lesser overall benefits than those under Plan A, though the gap has decreased from the last contract.
For example, the co-pay still exists under Plan B. The deductible is $250 ($500 for a family), with the company paying 80 percent of the coinsurance and workers 20 percent, with an out-of-pocket maximum of $2,000 for an individual ($4,000 for a family).
Despite this, the UFCW argues that the new HRA, in the words of Local 21 President Schmitz, is “a groundbreaking health care benefits package that means better care at lower costs for members.”
But where does the money come from for the annual allowances in the HRA? According to Randy Zeiler, chief spokesman for the Big Three companies in the Puget Sound area, employers paid $4 an hour worked by each employee into the multi-employer health plan, known as the Retail Clerks Welfare Trust (RCWT).
Starting October 1, this was cut to $1.11 an hour. The companies’ contributions will rise to $2.85 in May 2008 and be back to $3.95 in May of 2009. But the reduction of employer payments will save the companies millions. Instead of relying on employer payments, the union will allow a $150 million surplus in the RCWT to fund the HRA.
In Southern California, the union will allow the HRA to drain $240 million of a $500 million surplus from the health and welfare plan.
In addition to this, the Southern California contract will let deductibles rise sharply-- from $250 to $1,000 a year for an individual, and from $750 to $2,000 a year for families.
The inevitable result will be a rationing of health care resources, with workers skimping on needed services now in order to save money for the future.
A 2006 study by the Kaiser Family Foundation of HRA-type plans, known as Consumer-Directed Health Plans, found that workers in such plans are more likely to forgo needed medical care, not fill prescriptions, and take less than the prescribed dose or skip doses than people enrolled in more tradition plans.
The UFCW contracts still maintain the traditional health care plans in addition to the HRA. But is it fair to characterize as a victory a contract that allows the Big Three to avoid paying what could be several hundred million dollars over the life of the contract into the RCWT? Keep in mind that in 2006, the combined profits of the Big Three were $8.3 billion.
The new contracts are likely to become the models for the other UFCW grocery agreements across the U.S. In a climate in which workers’ health care under is constant attack, organized labor has the power to draw the line and boost the struggle for health care reform. Unfortunately the UFCW, despite its rhetoric, has so far failed to do this.
This article was originally posted at: http://www.socialistworker.org/2007-2/653/653_15_UFCW.shtml
SUPER CARD OR SUPER SCAM?
Raley's pact is put to a vote Add Your Comment
Comments 7 Comments Posted
Posted by franksalot Give the members a chance to vote
Quoting the Bee "In a recent letter to UFCW Local 8 members, President Jacques Loveall called the talks difficult " The Bee refers to Jacques Loveall as the "President" of UFCW Local 8. Was Jacques ever elected by the membership to become their President? I don't believe he was. In fact, his father Jack, was also never voted in by the local 588 membership to be their President. If UFCW Local 8 wants their membership to vote on their labor agreements, shouldn't they also want their members to vote for their President? Only by giving the members of UFCW Local 8 the opportunity to vote for their President, would we know if Jacques Loveall would be the President. It seems to me that it should be just as equally important for the members of this union to be able to vote for their President as it is for them to vote on their contracts. Jack and Jacques have been running this union for over 25 years and neither of them gave their members the chance to vote for them in an election...
QuackQuaack at 7:14 AM PST Saturday, November 17, 2007 wrote:
Congratulations to the workers & Raley's
How good to read that my favorite supermarket, Raley's, and its employees can work together for the benefit of both in contract negotiations. This kind of attitude is good to see.
riverrogue at 12:59 PM PST Saturday, November 17, 2007 wrote:
In response to frank(talks)alot
It sounds like you are a disgruntled employee. Most likely one that thinks he/she is worth a lot more than they are being paid. I am not a retail clerk nor have I ever been one but I have been a union member for many years working alongside retail clerks such as yourself (?). I have watched the various people that you have criticized in your comment obtain and continue to obtain decent contracts for you clerks in a time of hard pressed negotiations. Look around you. Quit complaining about whether they were ever elected and be grateful for what you have. I'm sure you must think that there is a loophole that let these people get elected. Don't you think the International would step in if there was some hanky panky? . With the scanners that there are now it certainly doesn't take much skill to do what you do, not that I'm saying it's easy, it just doesn't require the skill that it did years ago. Be grateful, that if you stay in the craft, you will have a "guaranteed" retirement income!
haas73 at 3:09 PM PST Saturday, November 17, 2007 wrote:
shoot i wish i was in the union, im trying to get in with meat dispatch as we speak, went to placerville from sacramento a couple times to work on my days off from my regular job, had a question about something so i emailed ufcw 8, a rep actually called me back within an hour, i was shocked about good they have it, paid day for your birthday sums it up right there not to mention the pay, shoot im so used to the "culture" of anti union big box companies that shall be nameless, that i was blown away by all the benefits that that particular union got. So I wouldnt be complaining about who got elected and how. when i told the rep that i was surprised that he called me back , he just said "this is what we do"
franksalot at 4:46 PM PST Saturday, November 17, 2007 wrote:
riverrogue, You sound as if you work at the U.S. Dept. of Labor. A federal agency that doesn't care if UFCW 8 hold elections either. The U.S. Dept of Labor requires Unions such as this one (UFCW 8), to hold an election every 3 years. I have done the math and my calculations show that there should have been at least 8 elections voting for the officers of this Union, and yet there has never been one since the Loveall's took over this Union back in the early 80's. Buddy, you have no idea who I am. However, I will say this: The amount of corruption I have uncovered in this Union shows me that it is people like you, who snub the meaning of "democracy" and make it possible for Unions like this to exist. Oh, by the way, I am not a current member of this union. I thank God I don't have to pay union dues to assist these crooks in living lavish lifestyles while their members earn barely enough to pay their bills!
GrandMasterFunk at 5:59 PM PST Saturday, November 17, 2007 wrote: Yo Frankie... Would you (or other union members) be willing to "give back" concessions or take inferior contracts if you were allowed to vote for Union President? While I never belonged to the union that the Lovall's have run (or dictated, as you would have us believe), I have been involved in meetings with Jacques and one of the "employers". I was amazed at what Mr. Loveall was able to accomplish (as riverrouge has mentioned).
I can't stand the union to which I am all but forced to belong to (they have a proven track record of being inept), and am much more of an anti-union person than a proud card-carrying member. But I must admit, over the years UFCW Local 8 have gotten pretty good contracts (compared to other grocery workers). Maybe you should attend the Harvard class that the negotiators were required to take - it may help you realize that a small give-back (not voting for a president, as you claim) can have huge gains for many others.
Be careful for what you wish, it may come true.
riverrogue at 8:33 PM PST Saturday, November 17, 2007 wrote:
in response to frank(talks)alot Frank(?) no I'm not a member of the U.S. Labor Department and yes I do think I know who you are (I've met many people like you also). No Frank (?) I'm just an old retired guy that belonged to the Union for many years and thankful for it. I didn't "hide" behind the Union I just went to work to work---does that make since. Now I'm living a quite comfortable life because of the "union pension" I receive that my Union negotiated for me over the years. I know that the elections were held in the Retail Clerks Union all along as the clerks and I discussed the elections as I was servicing the stores. You must of ran once and lost--right? The people that represent (ed) you are no different than the CEO's of major companies trying to get the most for their company (members). They deserve what they make. It's a 24/7 job a lot of the time.
franksalot at 9:25 PM PST Saturday, November 17, 2007 wrote:
riverrogue
In 30 years, the young clerks you see today working in the stores, won't be typing out comments like you, gleefully telling the world how wonderful their union leaders took care of them through the "Loveall" contracts of the1990's and 2000's. No, 30 years from now, retired members then will be receiving a pension 34% less than what it is today for retired members. Thanks to the "Loveall's" cut in the pension for today's young workers. Sad to say, but today's UFCW 8 members will forever be committed to a job and will never be able to retire like you. Maybe you should take some time, while in your comfy retirement, to check out the last contract negotiated by the Loveall's and see if your blind eyes can spot all of the takeaways!
The bottom to all of the above is there are still a lot of ignorant people out there and the Sac Bee featured some of them in their web site comments section today-pertaining to the Bee's article