LONG BEACH, California – Kroger Co. will close two Southern California supermarkets in response to a local ordinance that requires an additional pay for certain grocery store employees working during the pandemic.
The decision announced by the company on Monday following a unanimous vote last month by Long Beach City Council forcing a 120-day increase of $ 4 per hour for supermarket employees with at least 300 employees nationwide and more than 15 in Long Beach.
Kroger KR,
said it will close a Ralphs market and a Food 4 Less on April 17, Press-Telegram reports.
“As a result of the City of Long Beach’s decision to pass an ordinance requiring additional pay for grocery workers, we have made the difficult decision to permanently close long-term stores in Long Beach,” the company in a statement.
The statement added: “This wrong action by Long Beach City Council goes beyond the traditional bargaining process and applies to some, but not all, of the city’s food workers.”
A city statement characterized Kroger’s decision as “unfortunate for workers, buyers and the company.”
The city of Montebello has approved a similar salary increase for hazard compensation and is being considered in Los Angeles and Pomona. Further north, Oakland on Tuesday approved hazardous compensation for grocery workers, while other cities in the bay area, including San Jose and Berkeley, were considering similar ordinances.
A lawsuit filed by the California Grocers Association states that the Long Beach ordinance interferes with the collective bargaining process between grocery stores and unions representing workers.
An association official said Monday that a $ 4 per hour increase represents a 28% increase in labor costs.
“There is no way that supermarkets can absorb this huge increase in costs without compensating anywhere else, given that supermarkets operate on thin margins and many stores already operate in the red,” said the president and CEO of the ‘association, Ron Fong.
The Long Beach ordinance was passed during a Jan. 19 meeting at which board members and Mayor Robert Garcia said many grocery stores gave employees a detrimental salary during the early stages of the pandemic, but they later removed it.
“These people who work in these markets and these grocery stores are heroes,” Garcia said at the time. “It simply came to our notice then. They have received this kind of extra pay in the past and, if in the past they deserved it, they deserve it today. ”
The Los Angeles proposal was advanced Tuesday with a vote in favor of the city council that the city’s attorney drafted an ordinance calling for an additional $ 5 per hour charge for workers at large supermarket and drug chains . The council called for the draft to be submitted as soon as possible for a final vote.