Long Beach Ralphs, Food 4 Less stores to close over $4 ‘hero pay’ boost for grocery workers

[GURPS]

In announcing the closure, Kroger cited a recently passed Long Beach City Council ordinance that mandated the hazard pay bump for at least 120 days amid the increased health risk to workers during the ongoing COVID-19 pandemic. The new law affects grocery stores with at least 300 employees nationwide or more than 15 employees per market in the city.

“As a result of the City of Long Beach’s decision to pass an ordinance mandating Extra Pay for grocery workers, we have made the difficult decision to permanently close long-struggling store locations in Long Beach,” a company spokesperson said news release. “This misguided action by the Long Beach City Council oversteps the traditional bargaining process and applies to some, but not all, grocery workers in the city.”

Kroger, which issued a $2 pay boost at the start of the pandemic, noted that it has already spent about $1.3 billion to reward associates and implement dozens of coronavirus-related safety measures since March, when the virus’ spread began accelerating in the U.S. That’s on top of other additional benefits offered to employees during the pandemic, including paid emergency leave, the company said.

Long Beach Ralphs, Food 4 Less stores to close over $4 ‘hero pay’ boost for grocery workers

Kroger, the parent company of Ralphs and Food 4 Less, will soon shut down two of its stores in Long Beach in response to the city imposing a “hero pay” increase of $4 per hour for some grocery stor…

ktla.com

 

[GURPS]

Grocery Store Owners Say That Pandemic Hazard Pay Laws Are Putting Them Out of Business

That ordinance was passed unanimously by the Seattle City Council in late January and went into effect earlier this month. It is set to last as long as the city's declared COVID-19 emergency is in effect. It applies to all grocery stores that are larger than 10,000 square feet and are operated by companies with more than 500 employees globally.

​

Kroger's store closures in Seattle mirror its actions in Long Beach, California, where the company also closed two poorly-performing stores following the city's passage of a near-identical $4-an-hour "hero pay" law for grocery store workers.

Those aren't the only stores that could be on the chopping block. Everywhere pandemic hazard pay policies have passed, store operators are warning they'll soon be out of business too.

In court filings in a federal lawsuit challenging Seattle's hazard pay ordinance, two owners of Grocery Outlet stores, a discount grocery chain, said the city's mandated $4-per-hour wage premium is forcing them to operate at a loss.

Steve Mullen, an owner of a Grocery Outlet in Seattle's Madrona neighborhood, said that the hazard pay law is costing him an additional $20,000 in labor costs each month.

 

[GURPS]

Three L.A. Grocery Stores To Close Due To Hazard Pay Mandates


Three grocery stores in Los Angeles have announced they will be shutting their doors permanently due to the excessive cost of hazard pay mandates to their workers. The requirements order grocery stores to pay a higher wage to employees, which created a financial burden for two Ralph’s stores and one Food 4 Less store in the L.A. area.

The closures will affect two Ralphs, one on West Pico Boulevard and one on West Slauson Avenue, and a Food 4 Less located on West Sunset Boulevard. In a statement on Wednesday, Kroger confirmed the stores will close on May 15. The three stores have repeatedly not performed as well as some of the other locations.

On February 24, the L.A. City Council voted to mandate that larger grocers and drugstores pay an extra $5 per hour to workers for the next four months.
Kroger said that with the new pay bumps in effect, it will cost an additional $20 million to keep the stores running for the next four months. The company said that, in light of the new ruling, it is “financially unsustainable” to continue the operation of stores that are already not doing as well as others.

 

[herb749]

Then of course blame the company for closing the stores and forcing customers to have to travel further to shop. For something they created.

 

[BOP]

So how much money is this supposedly costing the company; anyone know?

 

[Bare-ya-cuda]

So how much money is this supposedly costing the company; anyone know?

See post #2

 

[GURPS]

California Democrats See Their Mandated 'Hero Pay' Hike Backfire


United Food and Commercial Workers International President Marc Perrone blasted Kroger's decision to close the stores in a statement.

“Kroger has made billions in pandemic profits thanks to essential grocery workers in California and across the country," he said. "Kroger’s action today is a cruel attack on essential workers and threatens the food supply for California communities devastated by the explosion of COVID-19 infections in recent months. Essential workers in grocery stores are putting their health at risk every day to make sure families can put food on the table and city leaders are stepping up to ensure they have the hazard pay they have earned."

In Long Beach, Mayor Robert Garcia said they're going to court over the matter.

“The Kroger corporation is closing two markets in Long Beach because our city is requiring temporary hero’s pay for grocery workers during this pandemic,” Garcia tweeted. “Grocers are making record profits. We go to court this month, and we will defend the workers vigorously.”

 

[BOP]

See post #2

It's confusing because post #1 was talking about Kroger in Long Beach, then post #2 kept switching between Long Beach and Seattle, Kroger and Grocery Outlet.

Now I generally suck at math, but $20k seems like a lot. That's $5,000.00 a week, for what, a dozen employees? Maybe less?

 

[BOP]

California Democrats See Their Mandated 'Hero Pay' Hike Backfire


United Food and Commercial Workers International President Marc Perrone blasted Kroger's decision to close the stores in a statement.

“Kroger has made billions in pandemic profits thanks to essential grocery workers in California and across the country," he said. "Kroger’s action today is a cruel attack on essential workers and threatens the food supply for California communities devastated by the explosion of COVID-19 infections in recent months. Essential workers in grocery stores are putting their health at risk every day to make sure families can put food on the table and city leaders are stepping up to ensure they have the hazard pay they have earned."

In Long Beach, Mayor Robert Garcia said they're going to court over the matter.

“The Kroger corporation is closing two markets in Long Beach because our city is requiring temporary hero’s pay for grocery workers during this pandemic,” Garcia tweeted. “Grocers are making record profits. We go to court this month, and we will defend the workers vigorously.”

Translation: "we will go to court, the taxpayers will foot the bill, and we will keep these union workers employed and the union will be beholden to us come election season."

 

[TPD]

So how much money is this supposedly costing the company; anyone know?

Post #3

On February 24, the L.A. City Council voted to mandate that larger grocers and drugstores pay an extra $5 per hour to workers for the next four months.
Kroger said that with the new pay bumps in effect, it will cost an additional $20 million to keep the stores running for the next four months. The company said that, in light of the new ruling, it is “financially unsustainable” to continue the operation of stores that are already not doing as well as others.

Now I generally suck at math, but $20k seems like a lot. That's $5,000.00 a week, for what, a dozen employees? Maybe less?

A dozen employees is not enough to run a grocery store. When we owned Raleys Market in Ridge, 12,000sqft store, we had ~24 employees.

 

[Gilligan]

Translation: "we will go to court, the taxpayers will foot the bill, and we will keep these union workers employed and the union will be beholden to us come election season."

How can they expect a court to force a business to stay open?

Grocery stores typically operate on very slim margins...some of the lowest of any business activity.

 

[Clem72]

A dozen employees is not enough to run a grocery store. When we owned Raleys Market in Ridge, 12,000sqft store, we had ~24 employees.

And I assume a $4/hr bump to the employee costs quite a bit more to the employer given taxes, right?

 

[TPD]

And I assume a $4/hr bump to the employee costs quite a bit more to the employer given taxes, right?

Yeah that too.
Just another step towards UBI...

 

[DaSDGuy]

Underperforming stores close all the time. That's how corporate stays in business.

 

[vraiblonde]

Then of course blame the company for closing the stores and forcing customers to have to travel further to shop. For something they created.

Thereby creating one of those "food deserts" that the progbots are so hysterical about.....

Here's the thing, though:

Kroger's CEO gets paid hard - to the tune of $21 MILLION in 2019 alone. Here's a story about it:

Kroger Pays CEO $21 Million After Ending Store Workers' 'Hero Bonus'

'Eat the Rich' not yet available in deli section.

www.wonkette.com

And here are the receipts:

https://www.sec.gov/Archives/edgar/data/56873/000114036120011379/nc10008523x1_def14a.htm

And that's just him - the rest of the board gets a big ass payday as well. One poor guy only got a little over $2mil for the year - not sure how he survives.....

So them niggling about $4/hour for employees makes one go "Hmmm....." Now, I understand that $4/hour x however many employees is a ton of buckage, but the optics are still there. Multi-millionaires closing food stores rather than paying low income workers an extra $4/hour, or $160/week for full time, or $650+- per month. That freaking REEKS of greed and exploitation.

I understand what these op-eds are trying to manipulate me into thinking, but what I really think is that someone making $21,000,000 a year while whining about paying an extra $4/hour to employees is elitist overlord bullshit.

 

[GURPS]

How can they expect a court to force a business to stay open?

That was my question as well ..... sue Kroger why and how

 

[GURPS]

Thereby creating one of those "food deserts" that the progbots are so hysterical about .....

I would say it all depends on the structure of Kroger in California .... yeah the CEO is getting paid 21 million dollars a year, and the optics are poor

or the company makes 7 Billion in Gross Profits, last reported quarter .. it looks bad, but business are in to make money, not be a welfare system.


Kroger Gross Profit 2006-2021 | KR


Kroger annual/quarterly gross profit history and growth rate from 2006 to 2021. Gross profit can be defined as the profit a company makes after deducting the variable costs directly associated with making and selling its products or providing its services.

• Kroger gross profit for the quarter ending January 31, 2021 was $7.046B, a 10.32% increase year-over-year.
• Kroger gross profit for the twelve months ending January 31, 2021 was $30.901B, a 14.48% increase year-over-year.
• Kroger annual gross profit for 2021 was $30.901B, a 14.48% increase from 2020.
• Kroger annual gross profit for 2020 was $26.992B, a 0.91% increase from 2019.
• Kroger annual gross profit for 2019 was $26.749B, a 2.62% decline from 2018.

 

[GURPS]

The California Grocers Association also has filed a lawsuit against the city, claiming the ordinance is unconstitutional because it skirts a collective bargaining agreement between supermarket companies and unionized workers. A hearing is scheduled for February 19.

"Extra pay mandates will have severe unintended consequences on not only grocers, but on their workers and their customers," said Ron Fong, the trade group's president and CEO, said in a statement to CBS MoneyWatch.

"A 28% increase in labor costs is huge. Grocers will not be able to absorb those costs, and negative repercussions are unavoidable," added Fong, citing a study commissioned by the trade group.

Kroger will shut two California stores to avoid offering workers "hazard pay"

Nation's largest supermarket chain faults "misguided action" by local officials for decision to close stores.

www.cbsnews.com

 

[Bare-ya-cuda]

I am curious at how they define underperforming stores. I am not familiar with any of the areas these stores are in. Are they in bad areas where shoplifting is high, are shopping carts being taken, employees attitudes suck, poor management? If referenced stores are already operating at or near a loss and then I was mandated to increase salaries for employees I would probably shut it down as well no matter how many millions I make a year. underperforming stores close everyday in the US pre-COVID. These pay increase mandates probably just sped up the inevitable closings.

 

[GURPS]

How much is Kroger's profit during the pandemic? Grocer ups average pay to $15.50 per hour


Kroger's total sales surged 8.4% to $132.5 billion in pandemic-ravaged 2020 – tallying extra receipts to add the equivalent of nearly two Fortune 500 companies to its total revenues.

The Cincinnati-based grocer also posted a $2.6 billion profit for the year, a 5.6% increase. A key sales metric, identical sales without fuel, increased 14.1% in 2020.

Kroger's growth was propelled by an epic shift of customers' food consumption habits amid the COVID-19 pandemic: nearly $1 of every $4 that Americans used to spend going out to eat has shifted away to food consumed at home – so that's $162 billion extra mostly going into supermarket coffers, according to the U.S. Department of Agriculture. In early 2020, Americans were spending 49 cents of their food dollars at grocery stores, they are now spending about 56 cents.

The pandemic has also spurred consumers' embrace of ordering groceries online for either home delivery or curbside pickup.