KROGER, FARMER JACK NARROWLY AVOID STRIKE IN DETROIT REGION

DETROIT -- Kroger Co. and A&P's Farmer Jack here have reached agreement on new 39-month contracts with members of United Food and Commercial Workers Union Local 876.

s expired, and will run through June 5, 2004.

According to Jack Finn, the union's legislative director, the negotiations process nearly collapsed the day the old agreements expired, with 95% of union members who participated voting to authorize a strike. He said extensive local media coverage of the situation pressured the two retailers into returning to the bargaining table almost immediately, with Kroger reaching agreement a day after the contract expired and Farmer Jack reaching agreement three days later.

According to the union, the new contracts enable the chains to retain a two-tier wage system, including a lower pay rate for new hires, but increase employees' health benefits and make provisions for increased full-time positions.

Jon Flora, president of Kroger's Michigan marketing area, said the agreement was positive for all concerned parties, including customers. "Kroger continues to grow in Michigan as a result of our good working relationship with our associates," he added.

Executives at Farmer Jack could not be reached last week for comment.

According to the union, the new agreements include wage increases of $1.50 an hour for all employees, boosting the minimum pay scale at the end of the 39 months to $16.22 an hour from $14.72, with existing employees getting wage increases of up to $1 more than the $1.50, the union added.

"Our ultimate wish list included getting rid of the two-tier system, but that proved difficult to do," Finn told SN.

He said the contracts also provide for increases of 30% in health benefits, boosting the employers' contribution to $3.50 an hour from $2.30, while maintaining no copayments for employees. In addition, the chains agreed to add 500 full-time positions "provided company growth continues," with half the increase coming from new hires and half from increasing the hours of existing employees.