Save Mart makes 'last, best and final' offer to union workers

Now it's Save Mart Supermarkets that is veering dangerously close to a strike.

Frustrated after months of negotiations, the Modesto chain gave its union workers an ultimatum of sorts Thursday: its "last, best and final" contract offer.

Leaders of the United Food and Commercial Workers urged their members to reject the offer -- which could lead to a work stoppage. Hoping to avert a walkout, the UFCW called on Save Mart to resume negotiations.

"Now is not the time to abandon the painstaking progress both sides have made," said Jacques Loveall, president of UFCW Local 8 in Roseville, in a message to his members.

While a strike isn't inevitable, Save Mart's move escalates the tensions gripping the entire supermarket industry in Northern California.

The three unionized chains -- Save Mart, Raley's and Safeway -- have been pushing for concessions since October, saying they need help dealing with competition from nonunion stores. The UFCW has already authorized a strike against Raley's, the Sacramento area's leading grocer.

In short, the region could be heading toward one of the biggest labor conflicts the state has seen since workers struck Southern California's major supermarket chains in 2003.

That strike lasted five months, cost the companies hundreds of millions of dollars in profits and forced workers to swallow significant concessions. It also left permanent scars on the industry by severing long-standing

customer loyalties.

Scores of Southern California shoppers deserted the union stores during the strike, and "up to 20 percent of those consumers never came back," said Burt Flickinger III of Strategic Resource Group, a New York consulting firm. "They started shopping at Costco -- everything from Costco to Whole Foods to Walgreens."

Since then, the situation has worsened for the traditional union chains. Nonunion stores such as Wal-Mart and Fresh & Easy have flourished up and down the state in the past few years, making a strike potentially far more destructive now for union companies.

"Geometrically worse," Flickinger said, referring to the fate awaiting union supermarkets if a strike hit in Northern California.

The region's last supermarket strike, in 1995, lasted nine days. By issuing a "last, best and final" offer, Save Mart runs the risk of triggering another walkout.

Ron Lind, president of UFCW Local 5 in San Jose, advised his members to reject the proposal and authorize a strike against the Modesto company. Local 8, covering much of the Central Valley, also urged members to dismiss the offer. No votes have been scheduled.

If the members reject the Save Mart offer, then the next move is up to the company.

Under the law, Save Mart could simply implement the terms of that final offer, said Joseph Grodin, a labor expert at the University of California Hastings College of Law. That would probably leave the union with little choice but to strike, he said.

Still, a strike could be a ways off. Experts said Save Mart could simply be trying to exert more pressure on the union.

"I would call it a bargaining position, a hard bargaining position," said consultant Bob Reynolds, of Reynolds Economics in Moraga. "Nobody wants a strike."

Save Mart said it had no choice but to issue a final contract offer, because of terms included when it extended the union's contract in mid-May. The extension ran out May 29.

But it's also clear that Save Mart is growing impatient.

"We have negotiated for eight months and across 50 independent sessions, all in good faith, with the objective of securing the competitiveness of our company and protecting quality jobs for our employees," the company said Thursday.

Save Mart operates more than 200 stores in Northern California. It controls about 3.5 percent of the market in greater Sacramento, according to Scarborough Research, and holds a stronger presence in the San Joaquin Valley.

The grocer's decision to submit a final contract offer seemed to catch the UFCW off guard.

While details of the offer weren't disclosed, all three companies have been seeking relief on health care costs and other issues.

"We believed that we were making considerable progress," Lind told members of Local 5 in a message posted on the union's website.

"The company has chosen to halt that progress and present us with an overall proposal that ... would cause deep and dramatic cuts to your health benefit plan," he added.

Loveall, the head of Local 8, said the union has offered to meet with Save Mart next Monday, Tuesday and Wednesday "with the intent of making every effort to reach a settlement."

Call The Bee's Dale Kasler, (916) 321-1066. ------ (c)2012 The Sacramento Bee (Sacramento, Calif.) Visit The Sacramento Bee (Sacramento, Calif.) at www.sacbee.com Distributed by MCT Information Services

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