Union members at two of the largest grocery store chains in the region approved new labor contracts Tuesday even as troubling health care issues threaten to force renegotiation of the agreements as early as next year.
Workers at Giant Foods and Safeway ratified contracts in meetings Tuesday at the Cow Palace meeting hall at Timonium’s , according to United Food & Commercial Workers Local 27. Towson-based Local 27 represents about 8,500 affected workers in the greater Baltimore area and on the Eastern Shore. A new Giant store recently opened in Parkville Shopping Center.
Containing modest wage increases, the agreement mostly preserves the existing contracts, with little change in health care and pension provisions, said Breanne Armbrust, a spokeswoman for Landover-based UFCW Local 400, which negotiated jointly with Local 27.
Together, the two union locals represent about 25,000 Giant and Safeway workers in Maryland, D.C., and northern Virginia.
The biggest change from previous contracts, Armbrust said, is the new agreements expire in just 19 months, compared to previous contracts that ran for a full four years.
The reason for the abbreviated term, she said, is concern about the impact of the federal Affordable Care Act on health care insurance coverage for part-time employees.
If Giant and Safeway are required by the law to offer new health insurance to part-timers, the increased costs could trigger a renegotiation of the contract, according to Armbrust.
Local 27 executive vice president Tim Goins did not respond to Patch requests for comment on the direct impact on local workers.
UFCW representatives had held all wage increase information closely until the ratification meetings. Goins told the Baltimore Sun Tuesday that some workers would receive an increase of 45 cents per hour.
Armbrust said the 45-cent wage increase applied to all Local 400 Giant and Safeway employees except service clerks (cashiers) and courtesy clerks (baggers), who will get a smaller increase.
Increases go into effect retroactive to April 1, she said, but there is no provision in the contracts for a raise in the second year. Currently, wages average about $12 an hour, she said.
Similar contract negotiations with large grocery chains in Southern California, including Safeway, yielded wage increases of 25 cents an hour in each of the first two years, and a 30-cent an hour increase in the third year, according to Supermarketnews.com.
Giant Food President Anthony Hucker commented in a written statement Tuesday that “our goal was to reach an agreement that ensures that our associates continue to be among the highest compensated in the industry in the Baltimore-Washington area, while also positioning Giant to effectively compete in a growing marketplace.”
Harry Burton, an attorney and lead negotiator for the two grocery chains, said the Affordable Care Act is presenting unique problems for labor contract negotiators all over the country.
“Key provisions of the act are scheduled to go into effect Jan. 1, 2014, but we don’t know if the law will go into effect then, or what the regulations will be if it does go into effect,” he said.
“Health care costs are key element to any contract like this, so this is the only way to deal with the issue of uncertainty. We are seeing this in a lot of labor contracts around the country,” Burton continued.