Feb. 12—Safeway suffered a staggering $696 million net loss during the last three months of 2003, Safeway CEO Steve Burd told financial investors today. In October, Burd assured investors the strike by California grocery workers fighting for their health care represented an investment in Safeway’s future.
Now, investors are questioning Burd’s leadership as they see the true costs: Safeway’s pretax earnings have plunged by an estimated $168 million, an effective 35 percent drop.
“There are people on [Wall] Street who want a change” in management, J.P. Morgan Securities analyst Stephen C. Chick told BusinessWeek Online.
The figures fail to include undisclosed benefits derived from Safeway’s mutual aid pact with Kroger and Albertsons, the grocers Safeway is leading against the workers. According to a lawsuit filed Feb. 2 by California Attorney General Bill Lockyer (D), the pact violates federal antitrust laws.
Last October, 59,000 United Food and Commercial Workers members went on strike or were locked out at supermarkets owned by Safeway, Albertsons and Kroger in central and southern California. The grocers wanted to shift huge new health care costs onto workers and cut their wages—the model pioneered by Wal-Mart.
In December, the California Public Employees’ Retirement System (CalPERS), the state’s government workers’ pension fund and the nation’s largest public retirement plan, formally asked the chairmen and CEOs of Safeway, Albertsons and Kroger to “fairly and expeditiously” resolve the dispute with the UFCW.
“Fundamental to the fair treatment of employees is a reasonable health care plan that provides basic health care for your workers,” the letters said. “In addition we feel that your corporation’s blatant disregard for quality of life issues for your long term employees is having a significant impact on our investment in your corporation.”
Grocery Workers Gain Nationwide Support
Meanwhile, the grocery workers are gaining support in communities across the nation. Throughout the week, community allies are launching marches, rallies and press conferences to increase awareness of the Safeway-led assault on workers’ health care. In San Francisco yesterday, approximately 500 workers and elected, community, faith-based and union leaders, including California Labor Federation Executive Secretary-Treasurer Art Pulaski and California State Controller Steve Westly (D) rallied at the Pacific Exchange.
Nearly a dozen Bay-area religious leaders promised to bring the “Don’t shop Safeway” message to their pulpits. Also this week, Citizens for Consumer Justice joined union activists in an informational picket and press conference at a Safeway-owned Acme supermarket in Philadelphia. On Tuesday, Seattle UFCW supporters held informational pickets at two Safeways, with more rallies planned for the coming weekend. Today, activists are gathering at a central downtown Washington, D.C, metro entrance to distribute more than 20,000 “Don’t Kiss Healthcare Goodbye” leaflets and Hershey’s chocolate “kisses” to consumers.
Friday, activists will rally and hold a press conference at a Safeway store in Baltimore. In Los Angeles Friday, California Democratic congressional members, including George Miller, Linda Sánchez, Lucille Roybal-Allard, Grace Napolitano and Hilda Solis, will meet publicly with economists to discuss the effect of the grocers’ greed on working families, investors and the California economy. Actions supporting grocery workers will carry on into the weekend, with union supporters in Portland, Ore., rallying with Jobs with Justice activists on Saturday.
Make a donation to the striking grocery workers by donating online through the AFL-CIO or send a check made payable to AFL-CIO Secretary-Treasurer to the Hold the Line for Health Care Strike Fund, AFL-CIO, 815 16th St., N.W., Washington, D.C. 20006.
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