Kroger to close two more stores after workers receive ‘risk premium’

Kroger’s grocery chain, Quality Food Centers, will close two stores in Seattle next month in part due to a new law requiring a “risk premium” for frontline grocery store workers who continued to work during the Coronavirus pandemic.

Two QFC stores will close on April 24, a move “sped up by a new Seattle City Council mandate that requires some employers to pay extra for some, but not all, of the city’s frontline workers,” QFC said Tuesday. in a press release. declaration.

The decision drew a reprimand from a council member, who unanimously approved the law ordering large grocery chains to temporarily raise workers’ wages by $ 4 an hour.

“Grocery store workers have had to cover emergency shifts, take on additional responsibilities and are five times more likely to contract COVID,” Seattle City Council member Teresa Mosqueda said in a statement. “These workers shouldn’t be pawns in a game of chess.”

The law, which came into effect last week, has sparked legal challenges from the Northwest Grocery Association and the Washington Food Industry Association. A similar legal battle is unfolding in California, where the California Grocers Association is challenging risk premium orders in Oakland, Montebello and Long Beach.

The local United Food and Commercial Workers union called Kroger’s plan to shut down the two QFC stores as “a transparent attempt to intimidate other local governments into passing orders that would provide a risk premium to employees of grocery stores. First line”.

Taking a different approach, Trader Joe responded to a flurry of prescriptions by temporary salary increase $ 4 an hour for its workers nationwide, but reversing its traditional mid-year increases. Likewise, PCC Community Markets also extended the temporary $ 4 per hour wage hike to all of its nearly 1,500 employees in its 15 locations, beyond the eight Seattle stores affected by the warrant.

Kroger earlier this month said he would, too close a Ralphs and a Food 4 Less in Long Beach, California, after the city approved a risk premium ordinance the grocery chain called “misguided.”

Decision to end the “heroes’ salary”

Kroger last spring ended what he called “hero pay,” a $ 2 per hour bonus that the company briefly offered to its more than 500,000 workers as of April 2020. Instead, the company moved on to paying $ 130 million in bonuses, full-time workers receiving $ 400 and part-time workers receiving $ 200.

Kroger posted record profits during the pandemic as more Americans chose to stay home, increasing sales of food and other groceries. The company posted more than $ 2.9 billion in operating profits in the third quarter of 2020, an additional $ 1.2 billion in profit compared to a year ago.

Kroger is redirecting some of that money to investors, with a $ 1 billion share buyback announced in September. On February 5, the company announced a dividend payment of $ 147 million and said it intended to increase its dividend over time.