Retailer Kroger announced on Monday that it would permanently close two of its stores in Southern California due to what it says is a direct result of a municipal mandate that requires an extra $ 4 an hour for “hero pay” for essential workers.
A food company spokesman told FOX Business on Tuesday that the Long Beach City Council’s “wrong action” in passing a decree determining the extra payment has gone beyond “the traditional negotiation process” and “only applies to some, but not all, grocery workers in the city. “
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“The irreparable damage that will come to local officials and citizens is a direct result of the City of Long Beach’s attempt to pick winners and losers, it is deeply regrettable,” they said. “We are really sad because our associates and customers will, in the end, be the real victims of the actions of the city council.”
The Ralphs store at 3380 N. Los Coyotes Diagonal and the Food 4 Less store located at 2185 E. South Street are scheduled to close on April 17, 2021.
The Long Beach City Council – backed by Democratic Mayor Robert Garcia – passed the “pay for the hero” law in January.
The ordinance applies to companies with 300 or more workers nationwide and more than 15 employees in each matter and will remain in effect for at least 120 days, according to Long Beach Post News.
| Ticker | Safety | Last | change | Change % |
|---|---|---|---|---|
| KR | KROGER | 33.88 | +0.77 | + 2.32% |
Garcia’s office indicated FOX Business with his Twitter account, but noted that they would be in dispute over the matter.
Garcia wrote on Monday that grocery owners “are making record profits” and would go to court in February to “vigorously defend workers”.
Responding to his tweet, Garcia took a screenshot of a report by The Brookings Institution – a Washington, DC, nonprofit public policy organization – that noted that Kroger ended its initial $ 2 “hero payment” on May, despite “doubling its profits and spending nearly a billion dollars in 2020, to repurchase its own shares.”
“When big corporations make record profits and double their earnings – they need to share that success with those who provide the job. Period,” tweeted the mayor later on Tuesday. praising the Los Angeles City Council for supporting $ 5 of “hero pay” for grocery and drugstore workers.
The devastating economic impact of the COVID-19 pandemic has devastated key industries in recent months, forcing airlines to cancel flights, hotels to stop booking reservations and restaurants to move business abroad.
Millions of Americans lost their jobs – some indefinitely – or were laid off, with unemployment figures rising to 14.7% in April.
Kroger’s spokesman told FOX Business that the company is proud of its dedicated employees serving customers on the front lines. Since March, they said their companies have invested $ 1.3 billion to properly implement “dozens of security measures” and “reward associates”.
“We started implementing these security measures early in the pandemic and, since then, we have only strengthened our vigilance and determination,” they said.
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“We also continue to support our members through benefits such as paid emergency leave and our organization’s $ 15 million Helping Hands fund, which provides financial support for members who are experiencing difficulties due to COVID-19,” said the spokesman.
“This extra payment is in addition to the total compensation package that Ralphs and Food 4 Less has long offered to our members, which includes competitive salaries, strong health coverage and reliable pension benefits.”
“Despite these challenging circumstances, as a Southern California grocer owner, we remain committed to serving our communities and are grateful for our dedicated associates who serve our customers every day,” they said.
Kroger was not the only company against the actions of the Long Beach City Council.
The Golden State’s Grocers Association has filed a claim that, like Kroger, the decision interferes with the collective bargaining process between grocery stores and workers’ unions and that it would be detrimental to merchants and consumers in the long run.
“There is no way that grocery owners can absorb so much cost increase without compensation elsewhere, considering that grocery stores [razor-thin] margins and many stores are already operating in the red, ”said the association’s CEO, Ron Fong, in a statement on Tuesday to SFGate.
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Kroger’s spokesperson also pointed out to FOX Business a recent Los Angeles Times Editorial Board Op-Ed that hit local politicians for excluding certain frontline employees, some “essential” stores and even their own employees from their risk payment proposals, and said there was no “significant attempt to consider the impacts of requiring employers to raise wages by up to 30%”.
The solution to help frontline workers, they argued, would be to demand and impose safer working conditions.