Pension Issues Hold Up Labor Deal for Kroger in Houston

After months of negotiations have failed to land a contract with union workers, Kroger's Houston division this week spelled out its offer in a press release.

The deal on the table for United Food and Commercials Workers Local 455, which represents workers at the retailer's stores in the Houston market, contemplates $56 million in wage increases for employees, as well as plans to ensure access to reliable and affordable healthcare benefits, the retailer said.

The union, however, has refused to vote, Kroger contended, over objections to moving workers off an unstable pension plan and into a company-administered replacement.

The Cincinnati-based retailer has been moving to shore up or buy out pension liabilities for years now, including a deal reached earlier this summer with Ahold Delhaize and Albertsons and the UFCW to withdraw from varied multiemployer plans. 

"Kroger's commitment to increase wages and ensure our associates have access to world-class affordable, secure and reliable healthcare benefits is a core priority for the company," said Joe Kelley, president of Kroger's Houston Division. "Our plan removes any uncertainty front-line associates experience with their current health and welfare trust fund plan.”

Details of Kroger's "last, best and final" offer, first revealed in August, include:

Kroger has also offered to invest nearly $1 billion to improve the stability and security of past and future pension benefits for 33,000 associates across 14 divisions, including Houston meat clerks. 

UFCW Local 455 had not responded to WGB’s request for comment by posting.

The Kroger Houston Division operates more than 100 stores in Southeast Texas and Louisiana and employs more than 18,000 associates.