(Reuters circulated the following story by Kevin Krolicki on October 15.)
LOS ANGELES — The union representing striking Southern California grocery workers Tuesday said it had filed a $600 million lawsuit against Albertsons Inc. and Kroger Co.’s Ralphs chain accusing them of staging an unlawful lockout.
The lawsuit filed in Los Angeles County Superior Court charges that the two chains violated state law by locking out some 49,000 workers this week.
That action came after the United Food and Commercial Workers Union singled out Safeway Inc.’s Vons chain for a strike after contract talks with all three companies deadlocked over health care costs over a week ago.
The lawsuit, which seeks 60 days of back pay and other benefit payments, came as tensions rose on the picket lines in a dispute that could last weeks and has already cost an estimated $20 million in lost wages.
Representatives of the grocery chains were not immediately available for comment.
The pickets organized on behalf of some 70,000 workers have snarled deliveries at two grocery distribution centers in Southern California, and unionized truckers threatened to slow deliveries to another eight distribution hubs in a show of solidarity with the strikers.
The three supermarket chains, which control most of a lucrative market that includes Los Angeles and San Diego, kept stores open with replacement workers but have shortened hours in some locations or cut back on some services.
The strike has also prompted layoffs for about 100 truck drivers who have been idled in satellite distribution centers effectively cut off by picket lines, union officials said.
“The grocery strike is starting to ripple back to distributors and I think you’re going to see more of that,” said Jack Kyser, chief economist for the Los Angeles Economic Development Corporation. The strike is costing about $6.3 million per day in lost wages, Kyser estimated.
LONG STRIKE FORECAST
Analysts and observers agree the deciding factor in moving toward a resolution will be when the economic pain becomes unbearable for either or both sides as losses mount for the supermarket operators and bills come due for strikers.
“We anticipated a long strike. We are prepared for a long strike,” Sean Harrigan, an international vice-president for the UFCW told Reuters in Sacramento.
Workers walking the picket lines were getting between $200 and $300 per week from a union strike fund. Those locked out of work were being urged to apply for unemployment benefits, although it was uncertain whether they would qualify.
Faced with pickets at the 859 strike-bound stores, many shoppers have gone to rival chains that have steered clear of the labor dispute, many of which reported booming business.
Even so, many Wall Street analysts predicted that the chains would not back down, forcing grocery clerks back to work under a contract that will make them pay for some health care costs now borne entirely by the supermarket operators which face growing competition from nonunion rivals.
“It is our belief that Kroger, Safeway and Albertsons are looking at this strike and its cost as an investment in improving future profitability,” said Charles Cerankosky, an analyst at McDonald Investments, in a research note.
Meanwhile, tempers have started to flare on the picket lines, with fights breaking out between unionized truckers and replacement workers, Teamsters official Jim Santangelo said.
Teamster truckers have refused to cross picket lines, forcing supermarket operators to send managers or replacement workers to back the big rigs up to loading docks.
“There have been some fights inside the cabs,” Santangelo said. “Our guys know that’s the same scab that’s going to take a Teamster job next time we’re on strike.”
(Additional reporting by Michael Kahn in Sacramento.)