Kroger will close more stores over hazard pay laws for workers

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With the city’s risky hourly wage for food workers now at $ 4, Kruger will close two Seattle stores as the supermarket chain’s opposition to a dangerous wage bill recently passed on the West Coast continues to grow.

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Kroger will close more stores over hazard pay laws for workers 3

The company, the largest supermarket chain in the United States, will close two of its QFC stores in April in response to risky measures in Seattle, which will force supermarkets across the city to pay an additional $ 4 an hour to employees in more than 85,000 sq. meters. Feet. To pay the risk. The law came into effect at the beginning of this month.

Kroger will close more stores over hazard pay laws for workers 2

“Unfortunately, Seattle City Council does not believe that supermarkets can operate at very low profit margins even during the pandemic,” the Qatar Financial Center said in a press release on Tuesday. Both stores suffered “ongoing financial losses”. With the additional requirement of a “dangerous living wage”, “it becomes impossible to run a financially sustainable business.”

Kroger will close more stores over hazard pay laws for workers 1

At the outset of the pandemic, Kruger provided workers, including QFC employees, with $ 2 an hour for overtime, but ended the pay rise in May. During the pandemic, Kroger invested $ 1.5 billion in workers’ wages and store security measures.

Other Amazon (AMZN) supermarket chains, such as Albertsons and Whole Foods, also offered damaging benefits in the early stages of the pandemic, but have since lapsed.

However, there are already new ways to improve dangerous living conditions to benefit locally. In recent weeks, some West Coast towns have begun to demand wages for the precarious living conditions of grocers, as vaccine implementation is slower than expected.

Long Beach and Montebello have taken steps to require supermarket chains to pay employees for risk. In California cities, from Los Angeles to Berkeley, there are also proposals to give grocery store employees a $ 4 to $ 5 per hour increase.

Earlier this month, Kroger announced that it would be closing two Long Beach stores, Ralphs and Food 4 Less, in response to the city’s relocation. A Kruger spokesman at the time said the stores were struggling and that the closure was the result of a “wrong decision” by the Long Beach City Council to demand payment for the dangerous living conditions of the supermarket employees.

In deciding to close stores and stop payments for dangerous living conditions for employees, Kroger’s critics said the company has seen its sales and profits grow during the pandemic and that they should share more unexpected profits with employees.

In the first three quarters of 2020, Kroger’s revenue doubled from $ 1.3 billion to $ 2.6 billion compared to the same period in 2019. Brookings Institution member Molly Kinder (Molly Kinder) said payment and other security measures were in place be taken.

Kroger also repurchased $ 989 million in shares in the first three quarters of 2020. In September, Kroger’s board of directors approved a new $ 1 billion share buyback. Share buybacks have made stocks scarcer and the company’s stock price soared, and critics say the company should invest the money in employee salaries or benefits.

“These large grocery companies have the capacity and the moral obligation to make workers pay high salaries,” Kinder said in a report last month that she paid large retailers and supermarkets during the pandemic.

Mark Pirona, president of the Food and Trade Workers’ Federation of the United Nations, said Kroger’s decision to close stores as profits increase, rather than putting workers at risk, is “insensitive”.

He added that Kruger was sending “messages” to other cities so that they would not pass laws to pay for dangerous living conditions during the pandemic or raise the minimum wage in the future.

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