Dive Brief:

• Grocery workers represented by seven local United Food and Commercial Workers union chapters in Southern California have voted to authorize a strike. The local unions represent about 60,000 employees of Albertsons and its banner Vons, and Kroger banner Ralphs. Employees are working on contracts that expired March 3.
• In a statement shared with Grocery Dive, Ralphs said that all 190 store locations will remain open despite the authorization and will maintain "business as usual." The company will continue to negotiate in good faith, the statement said. The next round of negotiations is scheduled for July 10 to 12, with additional meetings scheduled for July 15 to 17, July 30 and 31, and August 1.
• An Albertsons spokesperson told Grocery Dive in an email that the outcome of the strike authorization vote does not change anything related to the negotiation process. "We remain committed to negotiating a contract that is fair to all parties, including our employees, and will continue to work to achieve that," she said.

Dive Insight:

Months of negotiations between grocery store employees and representatives from Ralphs and Albertsons, which began in early March, have not gone well. In April, the Press-Enterprise reported that talks were taking place "sporadically," with meetings every other week.

According to the Los Angeles Times, the new proposed contract for grocery store employees includes wage increases of less than 1% and funding changes to health care plans, which have raised concerns from unions.  

Representatives from the United Food and Commercial Workers union did not immediately respond to Grocery Dive’s requests for comment, but in its latest Facebook post, UFCW local 324 wrote, "Together, we voted to reject the pitiful contract offer that corporate grocery executives left on the table. 96% of membership across Southern California UFCW Locals said no to corporate greed and yes to fighting for what we’re owed."

Though this vote does not guarantee an all-out strike, the authorization to call a strike has serious implications. The dust has barely settled from Stop & Shop’s 11-day strike in April, which involved 31,000 workers and resulted in an estimated $100 million loss for parent company Ahold Delhaize. Another grocery strike — this one poised to be twice as big — does not bode well for Albertsons or Kroger, especially given the heated competition in Southern California. 

This is not new territory for Albertsons, Vons or Ralphs. In 2003, the same banners saw 70,000 Southern California workers walk off the job for four months during the largest grocery strike in recent history, which resulted in $1.5 billion in lost sales. 

If a strike is called, Albertsons, Vons and Ralphs shoppers will have ample alternative options for their grocery shopping. Although Kroger and Albertsons have the largest market share among traditional grocers in the region, there are plenty of others including Trader Joe’s, Sprouts Farmers Market, Big Saver Foods, Walmart and several smaller grocery chains. Notably, Aldi is also expanding quickly in the area, with 64 total stores statewide and 15 new ones planned in Southern California in the coming months.