Kroger goes down
The grocery chain is closing down two stores in California following the decision of the Long Beach City Council. They approved a coronavirus-related “hero pay” ordinance that boosts wages by $4 per hour.
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The pay increase was mandated in January and the decision involved workers at pharmacies and retail stores with 300 or more employees in the Southern California city.
The decision was announced earlier in 2021. The Ralph’s and Food 4 Less were closed on April 17. Employees shared the information with the local media. Both stores are operated by Kroger.
“As a result of the City of Long Beach’s decision to pass an ordinance mandating Extra Pay for grocery workers, we have made the difficult decision to permanently close long-struggling store locations in Long Beach,” said a spokesperson for Kroger several weeks ago. “This misguided action by the Long Beach City Council oversteps the traditional bargaining process and applies to some, but not all, grocery workers in the city.”
In March, Kroger said they will shut down three stores in Los Angeles. The City of Angels passed a similar $5-per-hour “hero pay” increase to workers amid the COVID-19 pandemic.
Kroger claims these three stores were “underperforming,” and said that the additional cost of temporary pay hazard pay made things even worse.
“The hero pay mandate in Los Angeles mandate will add an additional $20 million in operating costs over the next 120 days, making it financially unsustainable to continue operating the three underperforming locations,” the firm said. “Despite our efforts to overcome the challenges we were already facing at these locations, the extra pay mandate makes it impossible to run a financially sustainable business that ensures our ability to continue serving the Los Angeles community at those three locations with reliable access to affordable, fresh groceries and other essentials.”
It added, “We are proud of our role as a leading employer in Los Angeles and remain committed to our dedicated associates on the frontlines serving in our 65 other area locations.”
“Hero pay” mandates were passed in Coachella, Montebello, Irvine, and other Southern California cities.
Two Los Angeles City Council members made a move to introduce the motion to investigate the shutting down of Kroger stores.
“The city has an interest in considering whether it should take legislative action to address these closures and potentially future closures of other grocery stores especially in areas of the city that are commonly known as Food Deserts,” the motion introduced by Democrat Councilmen Marqueece Harris-Dawson and Paul Koretz, reads.
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Source: The Epoch Times
