Kroger Closing Two California Stores Over Pay-Raise Rules

(Bloomberg) -- Kroger Co. plans to close two Southern California supermarkets following passage of a local ordinance that requires grocery stores to raise their frontline workers' hourly pay by $4.

A Ralphs store and a Food 4 Less store in Long Beach, California, will close on April 17, the company said in a statement Monday. A spokesperson declined to provide additional information on the decision, such as how many employees will lose their jobs.

Several localities, including Seattle and Santa Monica, California, passed similar mandates in January requiring large grocery chains to increase pay during the pandemic. In Long Beach, the ordinance will require a $4 an hour “hero pay” raise for workers at chains that employ more than 300 workers nationally and at least 15 workers locally.

The company criticized the city for not raising the pay of its own frontline workers and said both stores had been struggling. The Cincinnati-based chain also said Long Beach was interfering with the traditional bargaining process.

“The irreparable harm that will come to employees and local citizens as a direct result of the city of Long Beach's attempt to pick winners and losers is deeply unfortunate,” Kroger said.

In response, a local union representing 22,000 members said in a statement that Kroger's move was “a blatant attack and retaliation” on essential grocery workers.

“Kroger closing these stores is a clear attempt to intimidate and discourage workers from standing up and using their voice to create better working conditions and wages,” said Andrea Zinder, president of the United Food & Commercial Workers Local 324.

Amid a recent wave of pay-raise mandates by cities and counties, the National Grocers Association, a trade group that represents over 1,500 retail and wholesale grocers, said in an email that the organization continues to advocate “for rewards” at the federal level for frontline workers.

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