Analyst Expects End to SoCal Strike

Jan 09, 2004
George Anderson

By George Anderson

A report written by Merrill Lynch retail analyst, Mark Husson, says both parties in the Southern California grocery lockout/strike are nearing a point where they will have no option but to settle the dispute.

The three chains involved, Albertsons, Kroger and Safeway, have each lost millions. Safeway’s Vons and Pavilions business lost nearly $500 million during the fourth quarter and can not afford to sustain these losses indefinitely.

The United Food and Commercial Workers Union (UFCW) is nearing the end of its term on health benefits for striking workers and Local 135 in San Diego Country has reduced strike pay, according to a San Diego Union-Tribune report.

Moderator’s Comment: Do you agree with the speculation that the lockout/strike in Southern California will end soon? Have the chains and union put themselves
at an insurmountable competitive disadvantage because of the strike/lockout?

Original thinking was needed on the part of both parties to keep this situation from happening. That never happened and now it may be too late.

We’d like to suggest the following resolution to the matter.

  1. Total compensation for the highest paid employee in each chain should have a dollar value no higher than 10 times that of the lowest paid.

  2. The Union will agree to the original terms put forth by the chains when negotiations began. It will also agree to a no-strike clause in the contract
    to cover up to a one-year period past the agreement’s expiration date.

  3. Twenty-percent of company shares in each of the chains will be employee-owned. Dividend reinvestment and a no-sell clause of at least five years will
    be in effect on all shares owned by employees.
    Anderson – Moderator

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