SEATTLE CHAINS TACKLE WORKERS' BENEFITS 2004-06-21 (2)

MARK HAMSTRA

SEATTLE -- The supermarket chains involved in labor negotiations with five locals of the United Food and Commercial Workers Union here submitted a benefits plan for a new contract last week that was soundly rejected by the locals.

"This proposal would effectively eliminate affordable, quality health care for workers," said Mike Williams, president, UFCW Local 81, Auburn, Wash., in a statement, adding the chains' proposal was "dead on arrival."

Among other changes, the chains suggested that new hires should contribute 20% of the weekly costs of the health plan and 30% of the cost of medical procedures.

"It's not a radical idea to have employees contribute to their health care plans," said Melinda Merrill, a spokeswoman for the chains. About 16,000 employees of Albertsons, Safeway and Kroger-owned QFC and Fred Meyer are covered by the contract, which expired in April.

Other changes proposed by the chains include raising the bar for eligibility for the pension fund so workers must be 21 and have one year of experience before qualifying for pension contributions. Now, workers are eligible at once and at any age.

Yet for employees who are eligible, the chains said they proposed a larger contribution to the pension fund than what the UFCW had suggested. The union had proposed an increase of about 14 cents per hour, vs. the 21 cents proposed by the chains.

"We believe this helps protect the pensions of current and future retirees," Merrill said.

She said the chains made very few changes to the retirement health benefits package that the union had suggested. Retiree contributions would be reduced from $299 per month per retiree and $336 per month per spouse to $150 per month per adult.

For current employees, the chains accepted the union proposal of having workers contribute $3 per week for employee-only coverage and $10 per week for family coverage. The chains agreed to increase their contributions up to 8% per year to cover increases in the costs of the health benefits plan.

The chains said the UFCW's proposal called for employer payments of $3.90 per hour per employee, while the chains proposed that they pay $3.63 per hour.

Other elements of the chains' proposal for health care coverage include:

An 80/20 plan in which employees pay 20% of the cost of medical procedures.

A $20 co-pay for office visits.

Prescription co-payments of up to $30.

The two sides are scheduled to meet again June 24 and 25.