Kroger’s owned supermarket chain, Quality Food Centers, will close two stores in Seattle next month due in part to a new law requiring “dangerous pay” for grocery store frontline employees who continued to work during the coronavirus pandemic.
Two QFC stores will close on April 24, a decision “accelerated by a new Seattle city council mandate that requires certain employers to provide extra pay for some, but not all, frontline workers in the city,” said the QFC on Tuesday at a demonstration.
The decision drew a rebuke from a board member, who unanimously approved the law that orders large supermarket chains to temporarily raise workers’ wages by $ 4 an hour.
“Grocery workers have had to cover emergency shifts, take on extra responsibilities and are five times more likely to hire COVID,” said Teresa Mosqueda, a Seattle city council member, in a statement. “These workers should not be pawns in a game of chess.”
The law, which went into effect last week, is generating legal challenges from the Northwest Grocery Association and the Washington Food Industry Association. A similar legal battle is taking place in California, where the California Grocers Association is challenging hazard laws in Oakland, Montebello and Long Beach.
The local union United Food and Commercial Workers called Kroger’s plan to close the two QFC stores “a transparent attempt to intimidate other local governments from passing decrees that would provide risky payment to supermarket frontline workers.”
Taking a different approach, Trader Joe’s responded to a flood of ordinances temporarily increase wages at $ 4 an hour for its workers across the country, but canceling its traditional mid-year increases. Likewise, the PCC Community Markets also extended the temporary $ 4 per hour increase to all of its nearly 1,500 employees in its 15 locations, in addition to the eight Seattle stores impacted by the mandate.
Kroger earlier this month said he also close a Ralphs and a Food 4 Less in Long Beach, California, after the city passed a dangerousness law that the supermarket chain called “wrong”.
Decision to end the “hero payment”
Kroger last spring ended what he called “hero payment,” a $ 2 per hour bonus that the company briefly offered to its more than 500,000 workers as of April 2020. Instead, the company started paying $ 130 million in bonuses, with full-time workers receiving US $ 400 and part-time employees receiving $ 200.
Kroger reported record gains during the pandemic, as more Americans chose to stay home, increasing sales of food and other groceries. The company recorded more than $ 2.9 billion in operating profits through the third quarter of 2020, earning an extra $ 1.2 billion in profits compared to the previous year.
Kroger is redirecting some of that money to investors, with a $ 1 billion share buyback announced in September. On February 5, the company announced a dividend payment of $ 147 million and said it expects to increase its dividends over time.