Hundreds of Grocery Workers Attend Meeting in Arizona With AG and FTC Chair Anxious About Losing Jobs Due to Kroger Merger
The UFCW is notorious for pushing through sell-out contract deals and Kroger has an abysmal safety record and safety enforcement is virtually non-existent
Hundreds of grocery store employees and union workers gathered anxiously in a high school gym in Phoenix last Tuesday, wondering if they would still have jobs by early next year.
A town hall at North High School was held by state and federal officials with the intent to answer questions about the Kroger-Albertsons merger previously announced about a year ago. But specifics on livelihood, worker contracts and food prices have yet to be determined, officials said.
United Food and Commercial Workers 99 (UFCW 99), a union representing retail employees across the southwest, hosted the event. Workers from retail stores Fry’s and Safeway filled the gymnasium to overflowing. An additional 1,000 viewers more tuned in to UFCW’s Facebook livestream to hear Arizona Attorney General Kris Mayes and Federal Trade Commission (FTC) Chairperson Lina Khan answer questions about how the merger would impact jobs.
Joe Fonseca, a worker at a Safeway grocery store in Scottsdale, raised that fear that everyone in the room shared. He questioned Mayes and Khan as to whether there was any way to protect his union contracts if the merger went through.
“I think the answer is we don’t know. And I do not like that we don’t know,” said Mayes. The Attorney General’s office announced in February of this year that it was launching an anti-trust investigation of the proposed merger.
“What we've seen historically, is that when you’ve had mergers ... companies can become too big to care, right? They know you don't have anywhere else to go. And so they don't have to fight as hard to make sure your job is a good job that is worth staying in,” said Khan.
The Kroger Company is the largest grocery retailer by revenue in North America, with a workforce of over 465,000. The company is notorious for its low pay and abysmal working conditions, which were exacerbated during the pandemic. Kroger warehouse workers in Memphis walked off the job in March of 2020 during the initial rise of the pandemic. In 2021, 19-year Kroger veteran Evan Seyfried took his own life after being harassed and bullied by a store manager for taking COVID precautions in his workplace.
These conditions are made worse because of the complicity of the union bureaucracy. UFCW, which represents many grocery workers at Kroger and its other stores like QFC and Fred Meyer, has repeatedly pushed through sellout after sellout. Last year, the UFCW rammed through a contract with below-inflation raises in Indianapolis in a second vote after workers had rejected the contract the first time, then deleted their social media page to avoid any opposition. The UFCW also isolated a strike by King Soopers grocery store workers in Colorado in 2022.
A worker died last August at a Kroger distribution warehouse in Memphis, Tennessee amid a blistering heatwave which impacted much of the United States. The Memphis Kroger worker was found unresponsive and declared dead by Memphis police.
If Kroger purchases Albertson’s, Kroger will take control of nearly 5,000 grocery store locations in 35 states around the country with more than 700,000 employees. In the state of Washington, Kroger would dominate the grocery industry as Kroger already took over the stores QFC and Fred Meyer several years ago. With the addition of Safeway and Albertson’s, Kroger will own all the major grocery stores in the state. Smaller stores with a local niche clientele, like PCC Community Markets, Metropolitan Market, and Town and Country will mostly be the only smaller markets in Western Washington.
Kroger’s argument in favor of the merger is that it will improve efficiency and lower prices, as well as enable chains of traditional grocery stores to compete with the rapid rise of Amazon as a major player in grocery sales. Amazon is predicted to reach more than $40 billion in grocery sales by 2024.
But with an increase in “efficiency”—that is, profit margins—also comes an increase in redundancy. In many parts of the country, Kroger brands like King Soopers and Fry’s compete directly with Albertsons brands like Safeway and Vons.
In July, the FTC announced new guidelines for the agency to use when deciding whether or not to block a merger. Khan’s office is currently investigating whether the Kroger-Albertson merger would constrain supply for smaller grocery chains. Khan said that the final decision was not up to her.
Kroger executives have vowed to fight for the deal in court. They argue that the merger would allow for a strategic response to evolving consumer demands and improvement to services.
Estevan Rodriguez, cashier and shop steward at the Fry’s grocery store in Sahuarita, has worked with the company for 14 years. He sees layoffs as a guarantee if the merger goes through.
“There’s a lot of stores next to each other. Some of them, there’s just no way that they’re going to stay open,” he said.
Kroger and Albertsons have said they will sell off several hundred stores to abide by antitrust legislation. These stores will most likely be ones in overlapping areas where the two chains have competing stores. Albertsons did the same thing with 150 stores when it bought rival grocery chain Safeway, divesting those stores into a spin-off chain called Haggen. After less than a year, every one of those stores went bankrupt and closed down.
Khan and Mayes both stressed that this merger stands to impact consumers and workers alike.
“I’m here to make sure that you all are benefiting from fair competition and the benefits it brings to fair wages and working conditions, but also to make sure that you all are getting to benefit as consumers, and make sure that you're benefiting from competitive pricing and good quality,” said Khan.
Rising food prices would be particularly devastating for Arizona, considering that the Arizona Department of Agriculture estimates that 1 in 6 Arizonans are affected by food insecurity. Phoenix alone has 43 food deserts or areas with limited access to affordable and nutritious food. Mayes also brought up the alarming possibility of “pharmacy deserts” being created in rural areas of the state.
“A lot of people get their pharmaceuticals or drugs from grocery stores now. And if a town has just one grocery store, and that grocery store is shut down, then thousands, if not tens of thousands of people can lose access to our pharmaceuticals,” said Mayes.
“I have seen no evidence that this will be a good thing for the workers of Arizona. None, zero,” Mayes said. “What kind of a state do we want to be? Do we want to be a state that stands up for workers and for families and for communities or not?”
The deal was expected to close in early 2024 after regulatory and anti-trust review. Khan said the FTC would continue the investigation and ultimately determine whether to fight the deal in court.