UFCW fights Kroger on two fronts: Wage theft, mega-merger
Courtesy Local 400, UFCW

CHARLESTON, W. VA.—Sharon Simpson worked for 79 hours over five weeks at a Kroger supermarket in Charleston, W. Va., last August and September.

She never got paid. She got so frustrated, she resigned.

Donald Austin started working last year at a Kroger store in Appomattox, Va., and still does. That’s even though, for “multiple weeks,” he told United Food and Commercial Workers Local 400, his paychecks were late and had deductions he never authorized.

Simpson, Austin, and two other Local 400 Kroger workers in Virginia and West Virginia are the public faces of one of two fronts where UFCW is taking on the grocery giant: A federal class action lawsuit against rampant wage theft, the result of new pay system, MyTime, instituted last year. It not only shorted their regular pay but denied them overtime pay, too.

The other is to get the Federal Trade Commission to rule against a mega-merger where Kroger gobbles up the West Coast-based Albertson’s grocery chain. UFCW also contested a $4 billion “special dividend” to Albertson’s shareholders, in Washington state courts, but lost.

That deal almost literally wiped out Albertson’s cash reserves, while lining the pockets of a predatory hedge fund, Cerberus Capital Management, the union said. It also smelled of influencing Albertson’s shareholders in advance to vote for the Kroger deal.

The result could leave workers and customers vulnerable to the sudden closure of Albertson’s 158 stores, Local 400, which is leading that campaign, and its allies told the FTC. The merger would drive up food prices, which rose approximately 13% last year.

And the unspoken subtext in both cases is that the workers who are short of cash, due to wage theft, or out of jobs, due to the merger, would be predominantly workers of color.

The mega-merger is bigger and could affect more people in and out of the stores. The wage theft affects at least 1,000, though, and it’s still going on, Local 400’s court papers say.

“Failure to properly pay” workers ”has occurred and continues to occur in a number of ways, which include but are not limited to:

  1. missing or late paychecks;
  2. paychecks for amounts less than are owed; and
  3. unauthorized and/or incorrect deductions or withholdings.”

Workers complained to supervisors about non-existent paychecks and the messed-up payroll system, and Local 400 filed a labor law-breaking (unfair labor practices) complaint with the National Labor Relations Board over its implementation, the union says. Nothing worked.

“We received more than 1,000 reports from Kroger employees experiencing payroll problems. We know for every report we receive there are many, many others that go unreported,” Local 400 President Marc Frederici said before heading for federal court in Richmond, Va., to file the case in January. Local 400 has 13,000 mid-Atlantic Kroger workers.

“Despite using every available avenue to bring these problems to Kroger’s attention, the company has refused to correct its payroll system. This is simply unacceptable.”

The mega-merger is another matter, and late last year, Local 400 enlisted 25 other organizations in its battle to stop Kroger from devouring Albertson’s and closing its stores.

Allies include Musicians Local 40-543, the Baltimore-D.C. Building Trades, the Center for Economic and Policy Research, Jobs With Justice and its D.C. branch, the D.C. Nurses Association,  the Metro Washington Central Labor Council, the National Employment Law Project, Teamsters Local 38 and UFCW Locals 5, 7, 324, 367, 770, 881, 1442 and 3000.

The mega-merger isn’t the first time Kroger “demonstrated contempt” for its workers, its customers, and their communities, the coalition told FTC Chair Lena Kahn, a noted critic of monopolies. During the coronavirus pandemic, Kroger “actually closed stores to avoid paying an extra $4/hour in hazard pay mandated by local ordinances,” they wrote.

“With a far larger market share than it already has, Kroger’s callous approach…will only expand and is likely decimate working and living conditions for all industry workers.”

And since Kroger bought back $2 billion of its stock in 2021-22—benefitting Cerberus—”there is no reason to think that the merged company would suddenly prioritize the living standards of its workers over further enriching its shareholders,” their letter adds.

“Consumers—meaning all of us, because every human being needs food to survive—would fare no better….In a time of crisis and need, both companies prioritized lining shareholders’ pockets before any sense of social responsibility” as the modern-day plague raged.

“People living in poverty will suffer most of all, not only because of skyrocketing prices as competition vanishes but through probable store closures,” it added. The number of supermarkets in the U.S. declined by 30% in the last few decades, UFCW said.

Except for New York City, most cities depend “on a handful of grocery chains” for food. Many have “food deserts” in low-income areas. The worst, with 32% of urban residents living more than half a mile from a supermarket, is Memphis, Tenn., the federal Agriculture Department said—and that was before the pandemic.

“Food deserts, which are common in low-income areas, have contributed to the crisis of food insecurity,” says Nailah John of the National Consumers League. “People’s nutritional options are often limited to cheaper, high-calorie, and less nutritious food. In eight of the 10 U.S. counties with the highest food insecurity rates, more than 60% of residents are Black.”

“Those conditions would worsen with the mega-merger,” UFCW and its allies told Kahn.


Mark Gruenberg
Mark Gruenberg

Award-winning journalist Mark Gruenberg is head of the Washington, D.C., bureau of People's World. He is also the editor of the union news service Press Associates Inc. (PAI). Known for his reporting skills, sharp wit, and voluminous knowledge of history, Mark is a compassionate interviewer but tough when going after big corporations and their billionaire owners.