UPDATE: July 15, 2020: The heads of three Canadian grocery chains told a House of Commons committee late last week that while they were in communication in the weeks leading up to June 13, when all three announced they would end extra pay for their frontline workers, they each came to their decision independently.     

Eric La Flèche, president and chief executive officer of Metro; Sarah Davis, president of Loblaws; and Michael Medline, president and CEO of Empire, all said that numerous factors, including the reopening of other retail stores, slowing sales velocity and a general return to normalcy within the country, contributed to their decisions. Davis said she sent an email to Metro and Empire along with Walmart and Save-On Foods on June 11 notifying the competitors of Loblaws' decision, while La Flèche said he contacted other grocery chains in May and June to ask if they were considering ending or extending employee pay increases, according to Canada's Global News.   

Medline noted that his company's two-Canadian-dollar hourly pay increase was not about safety but about recognizing workers for their extraordinary efforts. He expressed disappointment that the committee did not also call "two of the largest American corporations in the world" to testify — referring to Walmart and Amazon. “I’m interested that they are not being called to this committee as their programs ended long before ours,” Medline said.

Dive Brief:

• A Canadian House of Commons committee has decided to call executives of several of the country’s leading grocery chains to explain why they decided to stop paying frontline workers extra for working during the pandemic, according to a Yahoo Finance Canada report.
• Members of Parliament want to hear from Canadian grocers Loblaws, Metro and Empire, which all ended programs under which they provided workers with two Canadian dollars per hour on top of their normal pay on June 13. The committee might also ask labor union officials to appear before it, according to Yahoo Finance Canada.​
• Canadian Prime Minister Justin Trudeau has also jumped into the fray, telling reporters after the grocers’ announcements that they would end the extra pay that he expects that “people who’ve stepped up during this time be properly supported and paid for it,” CTV News reported.

Dive Insight:

Like their counterparts in the United States, grocers in Canada are facing backlash for their decisions to return wages to pre-pandemic levels even though the virus has not ended.

The three grocers that Parliament is summoning account for a wide range of banners across the country. Metro runs brands like Food Basics and Super C in addition to its namesake banner; Loblaw operates stores under brands such as Real Canadian Superstore and Loblaws; and Empire stores fall under names including IGA, Sobeys and Safeway.

As in the U.S., Canadian grocery stores saw a rush of consumers driven to stock up by the pandemic that translated into outsized sales. In a reflection of that, Empire announced last week that same-store sales rose 18% during the quarter that ended May 2, while net earnings rose 43%.

In America, Kroger posted stellar results for the quarter that ended May 23, weeks after drawing ire for ending its “hero pay” program for workers. Another high-flying U.S. grocer, Albertsons, ended its “appreciation pay” program on June 13, just before announcing that it is using its strong financial performance to jet onto the stock market.

Canadian labor leaders not only want the grocers to restore the pay they had been providing, but some also want it to become permanent. “It has become clear, based on governments, based on the employers, that the respect that our members are shown by consumers is certainly not shown by the corporations,” Jerry Dias, national president of Unifor, which represents workers in the supermarket industry and other sectors of Canada’s economy, said Friday during a virtual rally on Facebook.

Canadian politicians also want to know why the chains all decided to end the extra pay on the same day. In a unanimously adopted motion, the House of Commons industry committee said it wants the companies “to explain their decisions to cancel, on the same day, the modest increase in wages for front-line grocery workers during the pandemic, including how those decisions are consistent with competition laws,” Yahoo Finance Canada reported.