Food Workers to Vote on New Contract : Labor: The proposal contains concessions and reduced raises. Two supermarket chains walked out of talks.

Negotiators for about 100,000 Southland supermarket workers agreed Monday to accept a proposed three-year contract with major grocery chains that offers relatively small pay increases and reduced employer contributions to pension funds, illustrating the weakened bargaining position of the once-strong union.

The negotiators will ask union members to support the pact in ratification voting that begins today. If the members--who have been working without a contract since Oct. 3--reject the contract in the balloting that ends Friday, a strike could result. Approval is expected, however.

The agreement concludes months of negotiations between the United Food & Commercial Workers Union, which represented most workers in Southern California supermarkets, and the Food Employers Council, which represented Vons, Ralphs, Food 4 Less Stores, Hughes and Stater Bros. Two other chains, Albertson’s and Lucky Stores, withdrew from the council in August to seek separate talks. The union does not want separate talks, however and contends the two chains would be bound by a ratified agreement.

The proposed pay increases for the workers, which include virtually all employees--from checkout clerks to meat cutters--are significantly smaller than those in the previous three-year agreement. In addition, company negotiators obtained concessions allowing the supermarkets to reduce their contributions to pension and health funds, arguing that the industry faces continued hardship, according to union officials. The negotiators representing supermarkets did not respond to questions about the negotiations.

Union negotiator Rick Icaza, who voted against approving the contract, said the supermarkets failed to justify the concessions.

“The companies showed that their sales have dropped--but overall they failed to substantiate the claim that they’re facing dire financial difficulty,” he said.

Icaza plans to ask his local members to support the agreement, but said he will also relay his reservations. He is president of the local that represents 20,000 Los Angeles County workers.

During the first year of the proposed contract, a full-time employee would receive a $1,000 bonus and a part-time worker would get a $500 bonus, according to the union. Workers would get an additional 45 cents-an-hour raise in both the second and third years of the contract, for a total hourly raise of 90 cents by the third year.

By comparison, workers received wage increases totaling $1.65 an hour during the final year of the contract that expired earlier this month.

The proposal would also hand $445 million in savings to the supermarkets by allowing them temporarily to halt company contributions to the pension and health and welfare funds, said Icaza.

Southland supermarket chains are seeking to cut labor-related costs because sales revenue has been shrinking, industry analysts say. Warehouse stores and discounters have been luring customers away from supermarkets, and many shoppers are now buying less expensive food items, said Debra Levin, analyst at New York-based Morgan Stanley.

On average, Southland supermarkets that have been open at least 12 months have seen a 5% drop in sales revenue this year, said Edward Comeau, analyst at Lehman Bros. in New York.

Even if the contract is ratified, the union must still resolve its differences with Albertson’s and Lucky Stores, which abandoned the talks. Albertson’s withdrew from the Food Employers Council bargaining unit and Lucky Stores resigned outright from the council.

Lucky said it prefers to hold separate negotiations with the union, but would not comment on the issues. Lucky said it has filed a complaint with the National Labor Relations Board, contending that the union’s refusal to hold separate negotiates constitutes an unfair practice. Albertson’s did not respond to questions about the negotiations.

Union officials said Lucky and Albertson’s took part in early industrywide negotiations and must now accept the proposed agreement if it is ratified.

The Proposed Contract

Negotiators for United Food and Commercial Workers this week will ask their 95,000 members to accept a proposed three-year contract. Some highlights:

* Full-time workers would get a $1,000 bonus the first year. Part-time workers would get a $500 bonus the first year.

* Employees would be paid an additional 45 cents per hour the second year.

* Employees would be paid another 45 cents per hour the third year, bringing the total increase to an additional 90 cents per hour by the final year.

* The supermarkets would save $185 million by suspending company contributions to the pension fund for two years beginning in April, 1994.

* The supermarkets would save $260 million by suspending company contributions to the health and welfare fund for--depending on the supermarket operator--six to eight months.

Source: United Food and Commercial Workers