The hazard pay for grocery workers has been required by 8 cities and 1 county in Southern California in the past 2 months. But grocery chains are fighting it.
A wave of local measures requiring that grocery workers receive “hero pay” during the pandemic is rolling through coastal Southern California, a contentious movement that is gaining momentum and could have significant economic ramifications.
Since January, nine cities and one county have mandated that grocery companies pay workers an extra $4 or $5 per hour of hazard pay on top of their regular wages to support frontline retail workers who bear a greater risk for exposure to the coronavirus.
Three other cities — Buena Park, Costa Mesa and El Monte — are considering adopting similar measures.
“It is interesting to see cities jumping on board, and empowering to see the solidarity among our local leaders,” said Montebello Councilwoman Scarlet Peralta.
Others aren’t quite jumping. Or don’t want to.
No cities in San Bernardino County, nor the Board of Supervisors, have enacted hero pay ordinances as of early March, said Curt Hagman, board chairman. “I have not heard any rumblings,” he said.
“I totally disagree with the government telling the private sector what to do,” he added.
So far, grocery workers in Los Angeles, West Hollywood, Santa Monica and unincorporated areas of Los Angeles County will get a $5 hourly boost. Workers in Long Beach, Montebello, Pomona, Santa Ana, Irvine and Coachella will see an additional $4 an hour.
Coachella, in Riverside County, is the only city in the Inland Empire to adopt an ordinance. In addition, the desert city is the first in the state to include farmworkers as well as employees in restaurants.
City Councils elsewhere in the Inland Empire, including in Riverside, Jurupa Valley and Eastvale, have not discussed hero pay, officials say.
Long Beach was the first in the state to act. Northern California cities include Berkeley, Oakland, San Leandro and San Jose. San Francisco is considering a similar measure.
Most cities will end the pay increase mandate after 120 days. Montebello’s ordinance lasts for 180 days and won’t sunset until the end of July.
While local elected officials who’ve passed hazard pay and union members view the cities as acting responsibly by rewarding grocery workers bravely serving customers for a year despite many contracting COVID-19 and some deaths, the grocery owners don’t see it as benevolent and are attempting to stop the movement in the courts.
Ron Fong, CEO of the California Grocers Association, which has 300 retailers in the trade group representing 6,000 stores, said cities in LA and Orange counties are acting as “copycats” without fully understanding the negative consequences.
By forcing stores to raise wages it can amount to nearly a 30% increase in a store’s labor costs for an industry with a 1% profit margin, spelling economic trouble for the industry and consumers.
The consequences will be higher consumer prices, reduced store hours, possibly layoffs and store closures, according to the CGA.
The Kroger Co., which owns Ralphs and Food 4 Less, on March 10 announced that as a result of LA’s ordinance, it will close a Food 4 Less at 5420 W. Sunset Blvd., and two Ralphs, one at 9616 W. Pico Blvd. and the other at 3300 W. Slauson Ave. on May 15.
Previously, Kroger announced it will close a Ralphs store in East Long Beach and a Food 4 Less in North Long Beach on April 17. Though the Long Beach and LA stores were on the bubble of profitability even before COVID-19, the cities’ mandates contributed to the decisions, the company said in a statement.
Not all analysts see negative effects. The movement in California is gaining momentum, noted Burt Flickinger III, managing director for the New York-based retail consulting firm Strategic Resource Group. As pay raises for tens of thousands of grocery and pharmacy workers kick in, the extra spending power will benefit the Southern California economy, he predicts.
“Even for the short period of four to six months, a 15% raise or more for these workers could increase discretionary spending by 2% to 3% in Los Angeles and Orange counties, and that would be a big benefit for the California economy,” he said.
This is particularly true if the grocery jobs are held by second heads of the household or if it is a second or third job, he said. “Then, 60% of the wages may be spent on retail sales.”
The Grocers Association expects more cities to pass hero pay ordinances and says it is impossible to stop the wave by negotiating.
Instead, it is suing, partly as a deterrent, saying the cities are violating the National Labor Relations Act and are interfering in collective bargaining. The group also says the measures unfairly single out grocery stores over frontline workers in hospitals and fire and police departments.
“At this point, our only way of stopping these ordinances is to challenge them legally. Settling is not an option for us,” Fong said. There are no negotiating points, as he sees it, just a fundamental opposition. “We don’t agree the city councils should tell us what we should and should not pay our employees. We need to let grocers run grocery stores,” Fong said last month.
They’ve sued Long Beach, Montebello, West Hollywood and Oakland in federal court.
But the CGA lost the first round when Judge Otis D. Wright II denied an injunction to stop the ordinance in Long Beach from taking effect. Wright said: “CGA utterly fails to address why the ordinance is not an appropriate means for…fairly compensating grocery workers for the hazards they encounter as essential workers.” The case is ongoing.
Fong said the organization will oppose all the ordinances. “We feel we will prevail in the end.”
Long Beach Mayor Robert Garcia said the city attorney has spoken to other cities that have asked about the ordinance. “They want to make sure grocery workers are protected,” Garcia said on Feb. 26. “Standing up for hardworking people is always the right thing to do.”
Irvine’s measure will take effect on March 25 and last until July 25. Mayor Farrah Khan said that will give 700 workers extra pay until they can get vaccinated. “The hazard pay is justice for them being out there day in and day out, dealing with the public and people who don’t wear masks when they shop,” Khan said.
Andrea Zinder is president of the UFCW Local 324, which represents 23,000 employees in food, dental, financial, health care, optometry, packinghouses, retail drug and merchandising in Orange and southern Los Angeles counties.
More than 2,600 grocery and drug store workers within UFCW Local 324 have tested positive for COVID-19 since March 2020, the union reported on March 11. Eight members have died from the virus, Zinder said. A West Hollywood report found outbreaks at food facilities, like supermarkets, have risen exponentially since early November, citing Los Angeles County public health data.
Zinder said workers should receive hazard pay for both symbolic and practical reasons.
“Symbolic in that it shows the employers really, sincerely appreciate what the employees have been through,” she said. But, Zinder said, “Employers need to do more than call employees heroes.”
Zinder said that in addition to the six days of paid sick pay required by the contract, employees were given two weeks of paid sick leave to deal with COVID-19-related issues. But that benefit ended Dec. 31, she said.
Some employees have had to take unpaid time off to take care of themselves, spouses or children who are home from school.
The pandemic has put financial burdens on grocery workers in other ways.
Jose Ortiz, 48, has worked for Albertsons for 20 years. He is a meat manager at the market on Jeffrey Road in Irvine.
He said he is looking forward to the bonus pay because his wife, Beatriz, who manages concession stands at the Anaheim Convention Center, has been out of work because of the pandemic. Also, his two adult children who work in different grocery stores in Irvine and his 78-year-old mother-in-law live in their Santa Ana home.
Ortiz said he lives in “constant fear” that he will bring the virus home with him. He knew a meat manager at a different store who caught the virus. In the same week, that manager and his parents, who lived together, all died.
“The hero pay is what we are fighting for, for recognition of the danger we are all in. For being on the front lines for almost a year. We are exposed to hundreds of people every day,” Ortiz said.
“Some get angry when you ask them to put a mask on. Many times you are filling the case and you turn around and they don’t have a mask on,’ he said, “and it’s like, ‘Great.’ “
Reports from around the country indicate that customers have done more than express anger over mask rules. In Oklahoma City, a woman threw boxes of shoes at employees. In El Paso, the projectile was a box of donuts. A Pawtucket, Rhode Island sandwich shop employee had to duck a chair.
Zinder said even as the spread of COVID-19 is slowing and cases are declining, the hazard pay will remain necessary.
“Who knows if something will set it back? So until we know the virus is in check, nobody can let their guard down. The supermarket industry is just as vulnerable as ever,” she said.
Access to vaccines has been an important issue for grocery workers because of their exposure, Zinder said, but one that soon will be resolved.
Grocery workers in Riverside, San Bernardino, Los Angeles and Orange counties were eligible for vaccines as of March 5. On March 10, Kroger said in a statement that nearly 20% of Ralphs and Food 4 Less associates have received their first dose or have been fully vaccinated. The company is offering $100 to every worker who receives the vaccinations.
Because the pandemic continues to rage even as the spread has slowed, Zinder has been encouraging workers to get the shots. Ortiz said he plans to get them.
He said all employees’ temperatures are taken at the start of shifts at his store. But the safety of frontline workers remains a concern for the union. Cal/OSHA guidelines have been “unevenly” followed, Zinder said.
Officials at the United Food and Commercial Workers Local 1167, which represents grocery and some other retail employees in the Inland Empire, did not return calls seeking comment.
Zinder and Ortiz said they would like to see companies extend the hazard pay to workers who face the same exposure in cities whose governments haven’t required the bonus.
“It should be across the board. It shouldn’t be based on the leanings of a city council,” Zinder said. “We wish it didn’t come to needing to have the government telling companies this needs to be done. But companies were doing the wrong thing.”
Agreed Ortiz: “I believe all grocery store workers should get the pay, not just one city.”
Fong said many grocery stores have offered workers “spot bonuses” and discounts on groceries, while some have offered $2 hazard pay bumps. The stores have spent millions on plex shields for checkers and extra sanitizing procedures to keep workers and customers safe, he said.
Flickinger, whose firm keeps track of retail stores and labor, says the grocery chains should have asked the federal government to include temporary hazard pay for their workers in the American Rescue Plan Act of 2021, adopted by Congress on March 10.
“These workers have really put their lives on the line and they’ve earned and deserve hero pay,” Flickinger said. “It should come out of Washington D.C.”
