Grocery stores throughout California remain open as essential businesses. Given the nature of their jobs, the workers inside of those stores are at a higher risk of possible exposure to COVID-19 than most other people with jobs, especially those who can work at home. The Los Angeles City Council recognizes that fact, and it has unanimously proposed that grocery store workers temporarily be paid an extra $5 per hour as hazardous duty hero pay. An appropriate ordinance is being drafted. Other cities in California are making the same proposal.
More Supermarkets are Likely to Shut Down
The president of one labor union remarked that the city council’s backing of the temporary raise operated as an acknowledgment of the increased risks that grocery store workers face whenever they’re on the job. Employees have even taken the virus home to their family members. Some supermarkets have already shut down at least temporarily during the COVID-19 pandemic. Others are likely to shut down too if the pay increase measure passes. What comes to issue is if the pay increase measure passes, will any closures be out of economic necessity or spite?
The Fruit of the Long Beach Pay Hike
A similar pay increase was imposed in Long Beach where supermarket workers are earning an extra $4 per hour. Soon after the Long Beach ordinance was passed, Kroger Stores shut down a Ralph’s and a Food 4 Less in the city. Kroger said that with the pay increase, it couldn’t afford to keep the stores open. Grocery stores already have some of the highest expenses for retail stores. Between the high volume of inventory, margin profits, and insurance for operational hazards, grocery stores are already subjected to a thin profit margin.
That being said, the actions of the Long Beach City Council were characterized as misguided by Kroger. Without specifying what the consequences would be, Kroger argued that irreparable harm would be caused to grocery store workers. A Kroger spokesman also implied that the customers of its supermarket would also be paying higher prices.
Long Beach has Now Been Sued on the Issue
The California Grocers Association (CGA) has filed a federal lawsuit against the City of Long Beach seeking to have the city’s supermarket pay increase declared invalid and unconstitutional. The lawsuit claims that the Long Beach ordinance singles out supermarkets regardless of the fact that other businesses that have been deemed essential haven’t been required to pay workers anything more than what they’re being paid now. Many grocery store employees are members of various unions. The lawsuit also alleges that the Long Beach ordinance is preempted by federal labor laws that protect collective bargaining. The CGA is also filing lawsuits against other cities that have filed similar ordinances. Irving has also been targeted with one of those lawsuits after it approved an extra $4 per hour of hero pay for grocery store workers earlier in the month.
The grocery industry has boomed across the country from the time that people started staying home and restaurants began closing. Regardless of the fact that grocers maintain thin profit margins, they’ve remained profitable since the onset of the COVID-19 pandemic. Kroger maintains that it was meeting its ethical responsibilities to its employees before the Los Angeles hero pay mandate. It stated that 2020, it invested $1.3 billion to safeguard and reward its employees along with nearly another $1 billion securing pensions throughout the United States. Another $800 million was used for wage increases between 2018 and 2020. The company has also offered $100 to every employee who receives the coronavirus vaccine. A spokesman for the City of Los Angeles remarked that he couldn’t comment on the CGA lawsuit as the city had yet to be served with it. As it’s seeking injunctive relief, a decision on a temporary restraining order should be made in the near future.