By James Spinosa
ILWU International President
When the ILWU Longshore Division was bargaining its 2002 contract, we spent nearly the first four months talking about nothing but our health care benefits. The employers wanted deep cuts and we refused to settle for anything less than maintaining the package we had. Our resolve was firm not just because we were fighting for our families’ right to quality medical coverage. We knew that if we lost, other employers would be emboldened to cut the benefits of other American union workers.
That high profile role of protecting health care benefits for themselves and other workers has, in 2003, fallen upon the grocery workers of Southern California. The strike at Safeway/Vons, and the resulting lockout at Albertson’s and Ralph’s/Kroger is all about health care and the employers’ demand to virtually eliminate it. And the fact that it is economically unnecessary—the companies are hugely profitable—exposes the incredibly nasty and heartless attitude of these employers.
The companies callously calculated their proposals. They now contribute around $5.00 per hour worked by each employee into the health care fund. They propose only a five percent per year increase. Since the workers will get only the benefits that pooled money will buy and we know health care costs will continue to rise, that alone is a significant cutback. But it gets worse—way worse.
The employers are proposing a two-tier system. They will contribute only $1.35 per hour to the benefit fund for newly hired people and that money will go into a separate fund. Obviously, that level of funding cannot buy any meaningful benefits now, let alone over the three-year life of the contract.
With employers not contributing to the current health care fund for new hires, that fund and the benefits it can buy will continue to shrink as older employees retire. It is estimated that by the third year of the contract grocery workers will either see benefits cut by about 50 percent or have co-pays of $95 or more per week to maintain the current level of benefits. Considering that the average grocery store worker makes about $12.50 per hour and works 30 hours a week—an annual salary of below $20,000—it could cost them about one-third of their take-home pay to keep their health coverage. It is precisely these health benefits that have made grocery store jobs a reasonable option for many workers with families.
What makes this attack on their health benefits so outrageously unconscionable is the fact that all three of these companies are Fortune 50 corporations. Over the past five years each company has seen great growth in its operating profits—Safeway up 47 percent, Albertson’s up 101 percent and Ralph’s up 143 percent. In 2002 their operating profits were high—Ralph’s was $3.8 billion, Safeway’s was $3.1 billion and Albertson’s was $2.8 billion. These companies are not hurting. In fact, Safeway’s CEO Steve Burd has stated that his company would have to spend $130 million over three years to maintain current benefits—a mere four percent of just last year’s profits. Yet he has shown real determination to ruin the lives of tens of thousands of his workers for that. This is corporate greed out of control.
These companies are arguing that they must cut costs because of competition from Wal-Mart, which pays its workers barely above minimum wage and offers benefits with such high co-pays hardly any of its employees can afford them. But even when Wal-Mart builds and opens all the “superstores” it has planned for Southern California, it will only gain one percent of the grocery market in the region. Combined, Safeway, Albertson’s and Ralph’s currently control 60 percent of the market there.
The grocery stores in Southern California are not the first to be hit with cutbacks from these companies, but they are the biggest bargaining unit in the biggest market in the country. If the workers lose this one, the companies plan to take this attack nationwide as contracts expire. And as more and more manufacturing jobs are moved out of the U.S., the jobs that remain are more and more in services and sales, making this sector and its union—the United Food and Commercial Workers, the UFCW—more and more important to the American labor movement. If three of the country’s top 50 corporations can get away with eliminating health benefits for their workers, what chance do other workers, union and non-union, have of maintaining a decent standard of living? What kind of society are we becoming when honest, hard-working people are abandoned?
Our ILWU members in Southern California have been doing great solidarity work, massing at rallies and picket lines and helping the families out of work to survive. Our members in Northern California have also been participating in demonstrations and pickets at Safeway stores there and many of our people have made donations to the cause. But I also want to urge all ILWU members to contribute all you can afford to the union’s strike fund. The companies are ready and able to take big losses. The grocery workers’ only hope is other workers.
Please send your checks to:
UFCW Strike Hardship Fund
Attention: Secretary-Treasurer Joe Hansen
1775 K Street NW
Washington, D.C. 20006
