Thousands of workers at two of America’s biggest supermarkets are warning of potential mass layoffs as the giant companies push for a merger.
Local unions representing more than 100,000 Albertsons and Kroger workers strongly to oppose the merger because of its likely impact on competition, consumer prices and the job losses that will result from the sale of many stores.
During the US Senate panel hearings, Kroger Chief Executive Rodney McMullen, claims no employees would be made redundant, but said the company plans to spin off 100 to 350 stores. Kroger announcement it would pay shareholders approximately $4 billion in special dividends as part of the merger agreement, and spend $24.6 billion to acquire Albertsons, with expectations to close the deal in early 2024 if approved by federal regulators.
“A win for our customers, a win for our associates and a win for communities,” McMullen said. said in support of the merger. McMullen’s salary of $18 million in total compensation is 679 times that of the median worker at Kroger.
But many grocers who witnessed the 2014 and 2015 merger between Albertsons and Safeway saw similar promises made and then broken by corporate executives.
Naomi Oligario worked at a Safeway store for 31 years in Port Orchard, Washington when Albertsons acquired the company. His store was divested and separated under Haggen Groceries. Employees were not allowed to be transferred to another store, otherwise they would lose their seniority and the benefits that came with it. While working at the new Haggen, Oligario said prices had risen dramatically, driving out repeat customers.
The store was closed several months later, leaving Oligario and other workers to apply to work at another Safeway store or find other jobs.
“It was a fiasco and heartbreaking because some people with more seniority than me didn’t get their jobs back,” Oligario said. “It’s nerve-wracking to think that we might have to relive this whole fiasco.”
As a shop steward at United Food and Commercial Workers, Oligario said many of her co-workers are concerned about Kroger and Albertsons’ proposed merger.
“The CEOs of Kroger and Albertsons, they’re there to make sure it’s good for them to push through the merger. They don’t think of workers, they don’t think of consumers. They are thinking about their pockets,” Oligario added.
A Kroger spokesperson said, “We are committed to strengthening our track record of supporting associates by investing $1 billion to continue to increase associate salaries and benefits after the merger closes.
“Kroger will not close any stores, distribution centers or manufacturing plants as a result of this merger, including stores that may need to be divested to obtain regulatory approval.”
But many workers remain fearful.
Kyong Barry, a worker at Safeway in Auburn, Wash., for about 20 years and a UFCW board member, criticized the merger as a potential disaster for many workers, given many people’s past experiences.
Barry said: “They lost their career, their home, their dignity. This is how the Albertsons and Safeway merger rewarded their workers who made them profitable, and with the Kroger merger, it will happen again.
Christine Martinez was working as a pharmacy technician at Pavilions, a subsidiary of Safeway in Valencia, Calif., when Albertsons acquired Safeway in 2014.
“The company told us that the merger was going to be really beneficial for its employees. They really made it look like it was really a win-win, when in fact it wasn’t,” Martinez said. “It was really traumatic, really stressful.”
His store was the one that was divested as a result of the merger and turned into a Haggen. During the transition, Martinez said she and other workers were often paid late and the store closed several months later, leaving Martinez and her co-workers unemployed.
She currently works as a pharmacy technician at a Ralph’s supermarket, a subsidiary of Kroger, and fears that the same problems may occur.
“I think, it’s gone again with this situation,” added Martinez. “People will lose their jobs, it will happen again and it will not be good for the employees. A lot of employees are really, really worried.