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  • authored by news
  • published Mon, Apr 15, 2002

Sell-out at Save-On

Sell-out at Save-On, five years later
Five years ago, in the summer of 1997, a concessionary 5-year contract was negotiated for members of UFCW Local 1518 who work at Overwaitea Food Group's Save-On-Foods stores in BC. The company claimed it needed concessions so that it could compete with Real Canadian Superstores, whose workers were represented by UFCW, Local 777. For the workers, the deal meant a two tier wage scale, a buy-out package for current staff, an understanding that up to 50% of full time jobs would be replaced with newly hired part timers, a cap on the number of hours part timers could work. It also meant severe restrictions on strike activity that allow only half of the bargaining unit to strike - ever. For the union, it meant voluntary recognition at 14 Save-On Foods locations. The backlash from the members was immediate and intense. It would lead, eventually, to the creation of a union reform movement called UFCW Local 1518 Members for Democracy.

An article that appeared in The Vancouver Sun, August 22, 1997, tells the story of the contract, the misguided thinking of the union executives who accepted it and recommended it for ratification, the methods used to get the members' approval and - most importantly - the reaction of the workers who
would be subject to it. Featured prominently in this story was Brian Pinter, a worker at one of the stores covered by the deal. He would become extensively involved in Local 1518 MFD. His union said the deal would protect their wages and benefits for the next five years. Pinter and and
his co-workers said it was "a recipe for disaster five years from now". As for the company's claim that it had to compete with the Superstores, Pinter and many others saw right through that as well.

"Said Pinter, any protection for the current employees will likely disappear after five years as well. If the company implements its plan, the new part-timers will outnumber the full-timers two-to-one by 2003. At that time, Pinter said, they are going to go after the full-timers.
"We're going to be voted out of our benefit packages and wages by people who've been with the company for six months. Once we're in the minority, we're toast."

Pinter acknowledges the lower-wage competition from Real Canadian Superstore, but says the UFCW brought the problem on itself. In 1989, when Real Canadian Superstore first set up in the Lower Mainland, a newly-formed local of the UFCW, Local 777, negotiated a deal with wages about 30 per cent lower than the contracts at Safeway and Overwaitea.

Pinter said he participated in an organizing drive to bring the UFCW to the Haney store in 1989, but changed his mind and worked against the union when the 777 agreement was concluded. "I could see what that agreement was going to do to us and I did not support a union that would undermine our standard-of-living.

'This union did this to us and now they're claiming it's a wonderful agreement for everybody.'"

Five years later, what's happening? Bargaining is coming up around the corner. Deep divisions exist between workers on the two tiers. The union democracy movement lives on. Over the next few weeks, we're going to take an up close look at the past, the present and what lies ahead for Local
1518's Save-On Foods members.

The full text of the Vancouver Sun Article:

Overwaitea workers oppose union over two-tier agreement: Some employees feel the deal will eventually drive down wages for supermarket workers and create a rift between co-workers
Edward Alden
The Vancouver Sun
August 22, 1997


Some employees at one of B.C.'s largest food chains are fighting back against an unprecedented collective agreement negotiated by their union.

The five-year deal will preserve the wages and benefits of current employees, but bring all new hires in as minimum-wage, part-time workers.

Employees at the Haney branch of Save-On Foods are organizing the opposition, saying it could drive down wages across the board. "If people don't stand up now, five years down the road we'll all be working at 7-11 wages," said Brian Pinter, a 12-year employee at the Lougheed Highway
grocer. "It's a pathetic deal."

Pinter's concerns were echoed by some powerful voices in the union movement. Buzz Hargrove, national president of the Canadian Auto Workers union, which recently held its convention in Vancouver, said such "two-tier" agreements are "a very dangerous trend."

"It becomes a very divisive issue," said Hargrove, whose union broke with the U.S.-based United Auto Workers in 1985 partly because the UAW began negotiating agreements to bring in new hires at 70 per cent of the union rate. "We saw this as a real concern that could destroy the union."

The agreement between the United Food and Commercial Workers union Local 1518 and the Jim Pattison-owned Overwaitea Food Group will offer current employees as much as $2 an hour more over the next five years on wages ranging from $10 an hour for a starting clerk to $22.32 for a meat cutter.

But it will allow the company to hire a virtually unlimited number of part-time employees making only $8 an hour, with no benefits and little prospect of ever working up into the full-time ranks.

A junior clerk would have to work a minimum of six years at 20 hours a week to be eligible for full-time status and the higher wage rates.

The agreement was negotiated over the last eight months in an effort by the company and union to avoid a rerun of last summer's bitter lockout and strike, which shut down Safeway and Overwaitea stores in B.C. for 40 days. The companies at that time had demanded either across-the-board concessions or a two-tier agreement.

The new deal was ratified by a vote of over 70 per cent late last week, said union representative Tom Fawkes. The company has about 6,000 unionized workers in B.C.

But complaints are being raised about how the voting was done. Dave Hendrickson, a 20-year Overwaitea employee at a unionized store in Nanaimo, said that only about 20 of roughly 90 store employees attended the ratification meeting last week.

Once there, they were handed a 65-page set of complex contract amendments, and told to vote on the deal that night. "They [the union] kept it so close and so quiet right down to the wire," he said.

Pinter said that, of the almost 400 workers at two Maple Ridge stores, only 54 voted in the ratification meeting.

More than 7,000 Safeway workers, also represented by UFCW, have not yet started negotiations, but will face enormous pressure to follow suit. About 10,000 workers at 74 Alberta Safeways struck for more than 10 weeks earlier this year in an effort to win back previous wage concessions and improve conditions for part-timers.

The UFCW says its decision to negotiate the deal with Overwaitea simply acknowledged the new reality of the industry. "Overwaitea, Safeway and [others] have all said they're not interested in providing careers any more," Fawkes said.

"I think not to tell people entering the retail grocery business today that there's no future here is wrong," he said. "This is a job to get you a better education, or a trip to Europe. It's not the job you're going to retire in."

UFCW members told their leadership clearly that, if concessions had to be accepted, "it's not going to come out of what we've got, it's going to come out of anybody hired after us," Fawkes said.

Brian Piwek, president of the Overwaitea Food Group, said the agreement strikes a good balance between protecting the company's long-term employees and responding to fierce competition in the grocery business.

Traditional grocers like Overwaitea and Safeway have been reeling for the last decade as new discount retailers like Real Canadian Superstore and Costco moved into B.C.. For a generation, selling food was a stable and predictable business that offered generous wages and long-term job security. But that world has been turned upside down by the new competition, Piwek
said.

To have been permanently saddled with high labor costs in such an environment "would have been devastating in the long-run," he said.

The company can no longer promise people coming in as clerks that they can work their way high-paying, managerial jobs. "We can't keep the promises we could keep in the '70s and '80s," he said. "The numbers just don't work."

Retail consultant Thomas Leung said Overwaitea and the union didn't have much choice. "The Real Canadian Superstore set the tone a number of years ago," he said. "It was only a matter of time before the other chains followed suit."

With the new deal in place, Pinter says he has been told by a company official that Overwaitea Foods will build 19 new stores in B.C. in the next three years. Piwek would not confirm that number.

Under the agreement, all new hires will come in at the junior clerk wage; the company and union have accepted that as much as half the total labor hours by the year 2003 will be done by the new part-timers. The deal also includes a generous buy-out plan to encourage current, higher-paid employees to leave.

But to Pinter and others at the Haney store, that's a recipe for disaster five years from now. While wages and benefits will be protected until 2003, they believe the deal is a sellout to the company.

The Haney store was one of 14 non-union outlets of Save-On-Foods that were brought into the union through a controversial mechanism called a voluntary recognition agreement, in which the union and the company agreed to let the union in without the explicit consent of those employees. The UFCW will also represent all new stores under the deal.

But Pinter and other Haney employees, who receive the same wages and benefits as unionized workers, think they've been dragged onto a dying horse. "I just think the whole thing stinks," said Ray Herman, a 21-year employee at the Haney store. "You're going to get guys working side-by-side with with other guys making twice as much."

Furthermore, said Pinter, any protection for the current employees will likely disappear after five years as well. If the company implements its plan, the new part-timers will outnumber the full-timers two-to-one by 2003. At that time, Pinter said, they are going to go after the full-timers. "We're going to be voted out of our benefit packages and wages by people who've been with the company for six months. Once we're in the minority, we're toast."

Pinter acknowledges the lower-wage competition from Real Canadian Superstore, but says the UFCW brought the problem on itself. In 1989, when Real Canadian Superstore first set up in the Lower Mainland, a newly-formed local of the UFCW, Local 777, negotiated a deal with wages about 30 per cent lower than the contracts at Safeway and Overwaitea.

Pinter said he participated in an organizing drive to bring the UFCW to the Haney store in 1989, but changed his mind and worked against the union when the 777 agreement was concluded. "I could see what that agreement was going to do to us and I did not support a union that would undermine our standard-of-living.

"This union did this to us and now they're claiming it's a wonderful agreement for everybody."

Such two-tier agreements are not common in Canada. A search of the national data base of 1,031 collective agreements found only six references to "two-tier'' agreements, although this certainly underestimates the total number of similar deals. Four of the six were in the food services business, all negotiated by the UFCW.

The UFCW deal got some sympathetic support from Teamsters' union representative Dave Kozak, who negotiated a similar deal last year covering 980 employees at Dairyworld Foods in Burnaby. The agreement brings all new hires in at 70 per cent of the full union rates of $22 an hour.

Kozak said the Dairyworld deal was forced on the union by ferocious competition in the dairy industry that has seen hundreds of jobs leave B.C. for Alberta and Saskatchewan, where total wages and benefits are about 40 per cent lower.

"They're never good," Kozak said of two-tier agreements. "But sometimes you just get a gun held to your head."

He said another two-tier agreement the union negotiated about five years ago with Gourmet Bakery in Burnaby resulted in about 60 new jobs coming to B.C.

Tom Knight, director of the Centre for Labor and Management Studies at the University of B.C., said such agreements have been much more common in the U.S. than in Canada. The airline industry, for instance, experimented in a big way with two-tier deals in the 1980s, but later dropped them because they were bad for employee morale.

"You created more dissension because you had people doing exactly the same work for very different rates of pay," he side.

In a fiercely competitive situation, "it has it's place," Knight said. "But there's a downside."

  • posted by siggy
  • Mon, Apr 15, 2002 6:41pm

Another thing to remember about the '96 deal is that it also dragged Safeway members with it!

A few months later they were forced to gag down a *me too* deal.

  • posted by Troll
  • Mon, Apr 15, 2002 7:34pm

This sort of stuff has to end. The UFCW has to go.

  • posted by Scott Mcpherson
  • Mon, Apr 15, 2002 11:48pm

It cetainly appears so doesn't it Troll? These guys are just in too deep to be saved. Don't worry, if another union doesn't take a serious run at them soon the employers will show them the door in good time. Word has it OFG just might test the waters sooner than anyone thinks. I guess we'll all find out.

  • posted by Scott Mcpherson
  • Mon, Apr 15, 2002 11:48pm

It cetainly appears so doesn't it Troll? These guys are just in too deep to be saved. Don't worry, if another union doesn't take a serious run at them soon the employers will show them the door in good time. Word has it OFG just might test the waters sooner than anyone thinks. I guess we'll all find out.

  • posted by remote viewer
  • Tue, Apr 16, 2002 12:29pm

I think you are right Scott. As much as I respect everyone's right to determine what's best for them (and that includes those who favour reforming their current union), I think that in some cases, it will take a change to another bargaining representative to improve a group of workers' situation.

This is particularly so in cases of locals where agreements have been made that restrict the workers' right to strike. The Provigo "Partnering Agreement" is a prime example of one of these. The Local 1518 restrictions - where only half the bargaining unit can strike - are another. Without the right to strike or to strike effectively, what leverage have the workers got? How do you get out from under these agreements? It's almost impossible. Will the company agree to give up these restrictions? Fat chance. Will the union be able to bargain them out? Not likely if it has given up most of its leverage. In the case of the Provigo deal, it's not even in the collective agreement. How do you get rid of it? It's in the Locals affected by these strike restrictions that I think changing unions may be the workers' only option. Think about it: even if they reformed their union, they'd still be stuck with these restrictive side deals and no power to get rid of them.

  • posted by Scott Mcpherson
  • Sat, Aug 10, 2002 10:20am

quote:


"I think not to tell people entering the retail grocery business today that there's no future here is wrong," he said. "This is a job to get you a better education, or a trip to Europe. It's not the job you're going to retire in."


And I think it's just as wrong to unionize these people if you can't deliver a future for them. Taking dues from these people just so you can suck 100K out of them is disgusting. If you had a conscience you'd be assamed of yourself but you don't do you Tom. Firing you would have been near the top of my list buddy so thank your lucky stars those ballots were stuffed. It's people like you that create anti union haters and ultimately it's people like you who'll bring the union down.

There is so much more to this contract than meets the eye. For starters it never occured to anyone that with zone #1 nogotiating on behalf of everyone that the employer would cry about "cost of living differentials" from region to region? If I was sitting at the employers table I'd make the argument that people on the Island and in the interier have a lower cost of living and as such should earn less pay than people in zone #1.

Zone #2 can't vote and if the employer puts a final offer to the members that see's zone #2 take home less money than their counterparts in zone #1 there is nothing they can do about it. This is a huge savings for the employer and the union can pass the buck to zone #1 members that "they" sold out the interier people. If the employer plays their cards just right they can and will tear local 1518 apart.

  • posted by T S
  • Sun, Aug 11, 2002 10:05pm

Word has it OFG
just might test the waters sooner than anyone thinks. I guess we'll all find
out.

oh thats rich.. OFG Still has the loman issue at hand and they are going to lock employees out? pffff. will never happen they will drag their feet, drag their feet ,then drag their feet some more , If things dont go their way they will find some clause to take to the LRB , Like maybe the guy signing the contract didnt have the authority to sign that part. etc. . OFG is still waiting for the death nell of Lomans,,,( IF) things go according to their plan , BEND over retail. this is a co that has lost millions and guaranteed to reimburse MILLIONS to EV for set up costs to spite 165 full time employees at lomans, who make less than a full time cashier. and less than canadian superstore warehouse , who 12 years ago started this mess by earnnig 1$ hr less, THEN the UFCW will give the old, live to fight another day spiel, this is the best we could do, well win this fight bothers, yadda yadda bla bla we have all heard it before, Just gives us yer dues they say. Brooke sundin only negotiates CONCESSION contracts. and new hires are already minimum wage. The 2 sides will meet agrree to let thing slide , Lets just keep the doors open, people working. As OFG wait for Gordie campbell to change the successorship laws and other labour laws so he can give hydro to Jimmy without having to take the UNIONs. do I sound Bitter probbly, But does it ring true?? Imagine this cardboard signs over the save on signs changing the name to Foods Save, Jimmy sells the stores to himself Installs clown mangement co, says he doesnt own stores, controls all aspect of the stores, then buys them back without the union, dang i must be getting cynical ,sounds like the loman deal. then UFCW can start another econo fight,,, No dont think so UFCW will sell you out with some back room deal Ove r the promise of opening new stores. Just my opinion

  • posted by <Jimbo>
  • Mon, Aug 12, 2002 7:24am

Righht on TS...You hit the nail on the head.
Don't forget the part about blaming the employees themselves for the mess they are in because they make too much money and get waaaay to much time off.(even though it was Jimmy who offered the package in the first place!)

  • posted by siggy
  • Mon, Aug 12, 2002 7:35am

quote:


Word has it OFG
just might test the waters sooner than anyone thinks. I guess we'll all find
out.

oh thats rich.. OFG Still has the loman issue at hand and they are going to lock employees out?


You have to be more clear. Are you reminiscing or is there something 1518 members should know?

  • posted by <Jimbo>
  • Mon, Aug 12, 2002 11:09am

I don't know what TS meant, but I just heard 22 stores were taken from Lomans this morning and were switched to the new facility.That cuts the workload a lot. That is Lomans work and is supposed to be protected at least untill the end of the contract.
Whatcha gonna do Brooke? Whatcha gonna do?
Think you have the BALLS to call an overtime ban or ANYTHING??????
Somehow, I doubt it, but we will be watching what you do to help the Lomans guys. Retail...Take note!

  • posted by <Loman Life>
  • Mon, Aug 12, 2002 5:09pm

Ivan must be breathing a sigh of relief. Now it seems unlikely that any work action can get in the way of our date with destiny. Ivan couldn't have been a better spokesperson for the company on this issue unless they wrote the letter for him.
July 31 letter from Ivan to the members, " We realize there is ongoing frustration with having to work overtime when the Collective Agreement says it is voluntary." One minor point Ivan. Nowhere in the labour relations board ruling are the words voluntary or overtime used. That was a very brave stand you took there Ivan. Brooke must be very proud.

  • posted by Scott Mcpherson
  • Mon, Aug 12, 2002 6:47pm

If your contract states that all retail bound frieght must be sent out from the lomans location and the employer has shifted 22 stores to the other warehouse prematurely than the UFCW should declair the loads hot and expect retail members not to touch them/work them etc.

  • posted by <Jimbo>
  • Mon, Aug 12, 2002 7:33pm

Ha...No doubt they should, but guess what?

Ivan said "it's reeeeally hard to get a hot edict"

Brooke didn't mention it last time the BC Fed met, (even though we asked him to and he assured us that he would) and the next sitting isin't untill sometime in September so by the time it came out our contract will be over and we will be toast!
And did I mention, Iavn said it would be reeeeeealy hard."

Harder than he wants to work I guess.

  • posted by siggy
  • Mon, Aug 12, 2002 7:43pm

quote:


Brooke didn't mention it last time the BC Fed met


Don't they have e-mail, internet, Puralator Courier and private jets at their disposal to overcome Brookes' somewhat disturbing oversight?

  • posted by <Jimbo>
  • Tue, Aug 13, 2002 7:18am

No...no I guess they don't.

Damn eh?
Oh well, it was a reeeeeeally good idea though.

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