2004 May See Widespread Strikes And Lockouts

by David Bacon

Across the United States, the system for financing health care benefits for union workers is breaking down, as managed care drives the cost of medical insurance through the roof. Some employers, like Safeway, which owns the Von's store where Norton works, can pay the increases from rising profits, but they won't.

More than 40 million people in the country have no health insurance. Protecting his insurance has already cost Norton three months on the picket line.

Norton went to work for Von's 18 years ago. When the strike started last fall, he had become a grocery manager with wages that could support a family, in an industry where that has become a rarity. Unionized supermarket workers have been able to maintain a better standard of living than most, yet over three-quarters of the baggers, checkers, and stock clerks have trouble accumulating the work hours they need to survive. When Norton walked out of Von's on Oct. 11, it was over Safeway's demands to make life even harder.

The chain demanded for the first time that current employees begin paying for their health insurance. "They said they were just asking for $5 a week, or $15 for family coverage. When we did the numbers, it turns out it could cost as much as $95 a week by the end of the contract," he explains. The average weekly wage for a Los Angeles supermarket worker is $312.

In each of the last three years, the premiums charged by private health insurance plans have gone up 15 percent; the predicted future rise is 12-14 percent annually. Safeway wants to cap its contribution, and leave workers paying for those hikes.

More alarmingly Safeway is proposing to hire new workers at lower wages, with an insurance plan most wouldn't be able to afford. Safeway says it wants to pay $1.35 an hour for their medical care. The company pays about $5.00 an hour for its current employees. Few new hires will be able to pay the difference in cost between the company's contributions and the actual premium. And the premiums will rise in the existing plan as the workers it covers grows older with new hires being left out of the plan. Workers like Norton also fear that once these new "cheaper" employees come in, people like him will be weeded out.

"I'd like to ask Steve Burd (Safeway's CEO) at what point in his life he stopped caring about people and only about money," Norton asks angrily. "How can he tell his stockholders that putting 80,000 people on the street is an investment in their future?"

Once Norton and his co-workers struck, the two other large grocery chains in southern California, Albertson's and Ralph's (a division of Kroger Stores), locked out their own workers in a common front with Safeway.

The three grocery chains claim they need the concessions in order to compete with the world's largest corporation, Wal-Mart, with its lower wages and benefits. Yet most southern California Wal-Marts don't sell groceries, and even if the company did build 40 "super centers" throughout the state, it would only gain 1 percent of the grocery market, compared with the 60 percent held by the big three.

Northern California's 50,000 supermarket workers are watching with utmost concern -- their contract is up in September. "We certainly expect this fight to be on our doorstep then," says Rich Benson, president of UFCW Local 870. "That's why our local unions fully support the efforts of unions in southern California. Safeway has contracts from Virginia, to Colorado, Washington, and Nevada. This is a watershed moment, not just for the UFCW, but for the whole labor movement."

Norton and other strikers extended their picket lines to other areas of the state, where they say they've found a sympathetic public. But solidarity also has another source. "We're expecting a major confrontation with hotel chains over health care costs when our contract comes up this summer," says Mike Casey, president of the Hotel and Restaurant Employees, Local 2 in San Francisco.

California labor took a step towards a longer term solution to this problem, by pushing legislation this fall to begin taking healthcare costs. Just before being recalled, ex-Governor Gray Davis signed a bill, SB-2, which requires large employers to provide healthcare coverage for their employees. Another bill to establish a single-payer system, using the money now spent on health insurance premiums to extend care to all Californians, was introduced but didn't come up for a vote.

Unions, which backed the more limited SB-2, will have their hands full this year just hanging onto it. Newly elected Governor Arnold Schwarzenegger is collecting millions in corporate campaign contributions and promises a ballot initiative to repeal SB-2. But if unions and communities organize a coalition powerful enough to defeat him, the momentum could not only preserve SB-2, but also put single-payer on the agenda.