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Giant and Safeway workers approve new contracts, averting possible Safeway strike

Workers at Giant Food and Safeway in Maryland and the mid-Atlantic ratified new contracts with each of the grocers Thursday, with the Safeway employees averting a potential strike after reaching a tentative deal earlier in the day.

The United Food and Commercial Workers, which represents 25,000 employees at both companies in Maryland, Virginia and Washington, presented tentative agreements to each group at two separate meetings. Safeway workers were scheduled to take a strike vote, but union and Safeway officials agreed to a tentative contract at 2 a.m. Thursday and members approved it overwhelmingly.

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“We were able to reach an agreement with UFCW Locals 400 and 27 early this morning that recognizes our employees for their hard work on behalf of the company,” said Beth Goldberg, a spokeswoman for Safeway’s Eastern Division. “The agreement was unanimously ratified by our employees.”

The UFCW recommended approval of each proposed contract, which were negotiated over six months.

The Giant contract covers 14,100 Giant Food workers in Maryland, Virginia and Washington, including abouyt 2,600 in the Baltimore area. Union officials said the Giant contract guarantees full pension benefits for retirees and current employees, keeps workers’ wages ahead of minimum wage increases and expands access to health benefits for part-time workers.

Activists hold signs during a United Food and Commercial Workers rally at the Safeway store, Wednesday, Feb. 19, 2020, in Washington. The United Food and Commercial Workers Local 400 has been in negotiations on a new contract that would cover employees at hundreds of stores in Maryland, Virginia and Washington. (AP Photo/Alex Brandon)
Activists hold signs during a United Food and Commercial Workers rally at the Safeway store, Wednesday, Feb. 19, 2020, in Washington. The United Food and Commercial Workers Local 400 has been in negotiations on a new contract that would cover employees at hundreds of stores in Maryland, Virginia and Washington. (AP Photo/Alex Brandon)(Alex Brandon/AP)

The contract with Safeway’s more than 10,000 workers boosts wages and pension contributions and maintains current health care coverage, the UFCW said.

Funding pension benefits for current workers and retirees proved the most contentious issue, union leaders said. They said the agreements were among the only ones in the U.S. that secured a defined benefit multiemployer pension plan.

“We stood up to Wall Street and we won,” said Mark P. Federici, president of the UFCW’s Local 400, in a statement. “Our members and retirees can still count on their pension benefits being there for them.”

The contract includes an increase in company pension contributions by $18.6 million per year, or $74.4 million over the four-year life of the agreement. And it boosts wages by $49.5 million overall over the four-year life of the contract. Wages will increase in steps, by $4 million the first year, by $8.8 million the second year, by $15.3 million the third year and by $21.4 million the final year.

The union had recommended on Feb. 19 that workers reject an earleir offer from Safeway for a new contract that would cover 116 Safeway stores and fuel centers in Maryland, Virginia and Washington.

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The union had said the grocer was refusing to fully fund pensions, but the company had said it was offering to fulfill pension obligations.

The grocer said it would cover the portion of pension benefits that would not be guaranteed by the government’s Pension Benefit Guaranty Corp. if the plan goes insolvent. About 50,000 retirees and employees draw or plan to draw benefits from the pension fund.

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