Negotiation Updates

July 19th, 2022

The company met again last week with UFCW SoCal Locals to continue bargaining for a new pharmacy contract.

Contract negotiation is about finding areas of agreement and working through issues where we disagree. It’s about allocating available resources in a balanced way for your wages, health care, pension and other benefits. It’s about meeting your needs and ensuring customers have access to affordable medicines while keeping stores competitive.

Determining Factors of Any New Contract
While the union continues to make proposals that are unrealistic and extremely costly, it is important to note the terms and conditions of any new contract, including wages and health care and pension benefits, are based on many factors:

• Cost of living
• Market Share/Competition
• Cost of doing business
• Plus, other factors

Among the biggest factors for the Ralphs Pharmacy contract are the low percentage of total share of market in California for prescriptions and the cost of doing business, which includes the rising cost of goods and the steps the company takes to reduce the impact of inflation for Ralphs shoppers.

• California is a very expensive state to do business in – the most expensive across the Kroger family of companies due to labor costs (wages and benefits) and conditions, legal and environmental issues, and overhead like rent, utilities, transportation, etc.
• Competition in Southern California is fierce with many different options for customers to choose from when shopping for affordable prescriptions, fresh food, and essentials.
• During this time of inflation, the company is receiving price increases on items across the board. To help offset the impact to our associates and customers the company works to negotiate supplier pricing where possible, and we’ve increased our overall pricing investment to minimize the impact of inflation for Ralphs shoppers.

Committed to Reaching an Agreement
We hope you agree, these negotiations are a time for the company and the union to face issues head on and focus on fair and balanced solutions. We are confident by working together we can reach an agreement that is win for everyone.

Next Steps
The company will meet again on July 22. We will keep you up to date on negotiations with regular updates posted on your store communication board, FEED, www.RalphsCBA.com, and through your store leader. If you have any questions during this process, please talk to your store leader.

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