More than 8,000 workers at nearly 80 Kroger-owned King Soopers grocery stores around Colorado started a three-week strike on Wednesday, according to The Guardian. The strikes are in response to a union contract offer that a union member is calling “a crooked deal,” which won’t solve the problems facing King Soopers employees.
On January 11, 2022, Economic Roundtable published a white paper on grocery workers at Kroger, consisting of a survey of 10,287 Kroger workers in the Puget Sound region of Washington, the State of Colorado, and Southern California. The findings: Living and working conditions of Kroger workers have “declined markedly” over the past 20 years, with supermarkets now using poorly paid, part-time workers with inconsistent schedules. Some numbers:
- Over three-quarters of Kroger workers are food insecure—they run out of food before the end of the month, skip meals, and sometimes go hungry; employees with children report that they go hungry to provide food and other essentials for their children. Kroger workers’ rate of food insecurity is seven times greater than the U.S. average.
- Kroger management cost-cutting practices have compromised personal, health, and food safety in stores, even in a pandemic, resulting in high rates of depression and anxiety.
- 86% of Kroger’s workers work solely for Kroger. Were they to work full-time, earning a living wage would require Kroger to pay $22 per hour for an annual total of $45,760. The average annual earnings of Kroger workers comes out to $29,655, a shortfall of $16,105.
- Nine out of 10 Kroger workers report that their wages have not increased as much as basic expenses such as food and housing.
- 63% of Kroger workers say they do not earn enough money to pay for basic expenses every month; among that percentage, 44% say they are unable to pay for rent and 39% are unable to pay for groceries. 14% of Kroger workers are homeless now or have been homeless during the past year. This is most prevalent among workers aged 21 to 29: 53% of this group are unable to pay for rent.
- More than two-fifths of Kroger workers report that in the past year, they had to borrow money from their family or friends to pay for basic expenses.
- More than nine out of 10 say they will not have enough money to support themselves after they retire.
Meanwhile, The Guardian reports, Kroger reported a profit of $2.6 billion in 2020, and the Kroger CEO, Rodney McMullen, received a wage increase of 45%, bringing his salary to $20.6 million. In 2021, the company repurchased $1b in stocks throughout the first three quarters; towards the end of the year, it authorized another $1b towards stock buybacks. The company’s latest quarterly earnings show an increase of 7.2% in sales compared with 2020; sales increased 1.3% over the first two quarters of 2021. In comparison, the wage raise for retail workers from $15/hour to $16.25/hour equates to just $0.17/hour after inflation.
The latest deal offered by Kroger included concessions such as permitting the company to lower wages, use non-union gig workers, shortening leave-of-absence periods, relying on a part-time workforce, and offering only a $0.13 wage increase for some workers. While workers are pushing for a $6/hour increase for all employees, Kroger’s final proposal only included wage increases up to $4.50/hour based on job classification and tenure, with a $16/hour base pay—just $0.13 higher than minimum wage in Denver.
Kenny Sanchez, who has worked for King Soopers in Broomfield, Colorado, for 10 years, has attended the contract negotiation meetings between Kroger and the United Food and Commercial Workers Local 7 union, and told The Guardian that the out-of-state lawyers Kroger has hired don’t understand that the cost of living in Colorado has been rising, and wages aren’t keeping up. “We’re not making a living wage,” Sanchez said. “We have people living out of their cars and struggling to pay bills. This company does not get it. We can’t survive on what they’re paying out here and the competition is paying more.” And even the raise Kroger is offering comes with a caveat: “A pay raise is nice, but if you’re forking out a bunch more for health insurance, then there is no raise,” Sanchez continued. “That’s why it’s a crooked deal. Healthcare costs around the country have been going up and we need the company to put a little extra money into our health insurance to keep it affordable.”
The union has filed unfair labor practice charges against Kroger. Kim Cordova, President of UFCW Local 7, said the charges included refusal to furnish information necessary for bargaining over issues such as safety, and that the company has been directly contacting workers and threatening to discipline or send home workers for wearing anything that identifies them as a union supporter.
“The strike is over unfair labor practices, but we’re far apart over the issues of negotiations,” said Cordova, according to The Guardian. “The CEO was bragging to the shareholders on Wall Street about how well Kroger has done during the pandemic while restaurants and businesses were shut down. They thrived, they made record profits, their investors were the recipients of about a billion and a half dollars in stock buybacks and then they come to the bargaining table and say, ‘we can’t afford it.’”
Kroger’s response has been to bring in outside workers and to hire temporary staff—which it has done by offering to pay these workers $18/hour, compared to usual Kroger workers, who are often paid $16/hour or less. Reuters reports that Kroger is also encouraging customers to shop online by reducing delivery fees to $1 for orders worth over $35 for a limited time, while also opening up alternative “offsite” pickup locations, including a parking lot in Lakewood, Colorado.
In a press release, Joe Kelley, President of King Soopers and City Market, said: “Local 7 is putting politics before people and preventing us from putting more money in our associates’ pockets. It’s time for Kim Cordova to put our associates, her members, first instead of denying them the opportunity to vote on this unprecedented investment. Creating more disruption for our associates, their families, and Coloradans rather than negotiating for a peaceful resolution is irresponsible and undemocratic.”
However, Kroger executives have known for years that the company’s low pay is putting its workers in poverty, according to More Perfect Union, which obtained an internal presentation titled “State of the Associate.” The presentation, marked “confidential,” told Kroger executives in 2018 that hundreds of thousands of employees live in poverty, relying on food stamps and other public aid because of Kroger’s low pay. The presentation found that at least 1 in 5 Kroger associates were on food stamps, and said that low wages were cited by 27% of workers who quit the company. The presentation included this quote from an unnamed employee: “Something is wrong when the people who are actually making this company profitable are the ones deepest in poverty. I literally work at a grocery store and can’t afford to eat regularly. In short, pay us what we are worth; we know you can afford it.”
Looking at Ohio, where Kroger is based, the presentation noted that Kroger has the third-highest number of employees receiving SNAP benefits (behind Walmart and McDonald’s), and that in 2016, Kroger received $20m in tax incentives from the state of Ohio.