Are large grocery chains putting profits before people?

Discussion
Source: Walmart blog - "Supporting Our Associates"
Jun 24, 2020
George Anderson

America’s largest supermarket chains have stepped up during the COVID-19 pandemic with added safety measures, pay and benefits to support frontline workers in stores and warehouses. For all they’ve done, a new analysis by Oxfam concludes, they haven’t done enough.

The non-profit dedicated to ending poverty analyzed the personnel policies of Albertsons/Safeway, Amazon.com/Whole Foods, Costco, Kroger and Walmart in five areas: paid sick leave, hazard pay, personal protective equipment, engagement with workers and their labor representatives, and gender and dependent care.

“The COVID-19 pandemic has laid bare our deep systemic inequalities and massive failures in our economic system,” said Irit Tamir, director of the private sector department at Oxfam America, in a statement. “Nowhere is that more visible today than in America’s supermarkets, where workers are risking their lives every day in order to keep food on our tables.”

The Oxfam report states that at least 100 grocery workers have died from COVID-19 and that major chains, which continue to report strong sales, are seeking to roll back hazard pay despite seeing the numbers of infected with the virus growing in many parts of the country where they operate stores.

Seven states — Arizona, Arkansas, California, North Carolina, South Carolina, Tennessee and Texas — have reported a record number of positive cases and hospitalizations in the past week. The seven-day rolling average of new cases across the country has increased more than 30 percent from the previous week, according to a CNBC analysis of data from Johns Hopkins University.

As the disease remains unchecked in much of the U.S., the federal government is looking to end support for local coronavirus testing sites by the end of the month, according to reports from the Houston Chronicle, Talking Points Memo and The Washington Post. Nearly 124,000 Americans have died from complications connected to COVID-19 to date.

The Oxfam report takes issue with large chains failing to meaningfully engage with employees and their union representatives at a time when good communication is paramount.

“Companies should fully recognize the human, not just the business value of their workers, and stop treating them as expendable,” said Ms. Tamir. “Whole Foods and Amazon especially seem hell-bent on rejecting the crucial idea that they should genuinely listen to their workers.”

Amazon, which offers a minimum wage of $15 an hour, and other non-union grocery chain operators have consistently maintained that their labor practices and policies are employee-friendly eliminating the need for collective bargaining arrangements.

DISCUSSION QUESTIONS: Do you agree or disagree with Oxfam’s analysis that large grocery chain operators are not doing enough for frontline workers? Where do you currently see the biggest need for improvement when it comes to employee management in grocery stores?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"It's pretty simple. The risk premium shouldn't go away until the risk goes away. And it clearly hasn't. "
"This sounds less like they are not doing enough for front-line workers and more like the preamble to the next union strike."
"Risk assessment is a key issue here – could technology have a role to play in terms of improving? Absolutely, but it cannot always be deployed overnight."

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18 Comments on "Are large grocery chains putting profits before people?"


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David Weinand
BrainTrust

The workers in essential retail have certainly gone above and beyond what they originally signed up for. I am a little surprised to see the conclusions in this report as we’ve seen most of the industry step up during this crisis. We’re seeing the steps taken to reopen the economy blow up in the faces of those that put the plans into place so now I believe the essential retailers that were leaders when this thing started will have to again lead by being proactive to protect (and pay) the workers that are helping to fatten their balance sheets.

David Naumann
BrainTrust

Most grocers have done a very good job of compensating employees well from a pay perspective and I agree they probably haven’t done as much as they could on the softer side of things like communications and appreciation for front-line workers. The other miss for most grocers is not requiring customers to wear face masks, especially in areas with greater COVID-19 outbreaks. You are putting employees at greater risk when they have to deal with customers without masks.

Paula Rosenblum
BrainTrust

Most retailers (with a very few notable exceptions) do put profits before people. On a good day, among the good ones, it’s somewhat equal. This is not new news. I mean seriously, we can own the nature of the business model.

The only thing that changed is that during the lockdown, those people became front-line workers and had to be better taken care of than before.

Do I believe Oxfam? Of course. Do I think it’s going to change? During or after the pandemic if retailers want consumers to shop in stores, yes it will. The “drug” of home delivery or buy online, pick up at the curb has taken hold, and the only way to come off of it will ultimately be to improve the in-store experience (remember that?).

Right now during the pandemic retail workers are still at risk, and while the labor pool is large it’s also not ignorant. Things have to change.

Richard Hernandez
BrainTrust

All the grocers here have been very proactive with keeping employees and customers protected while shopping in their stores. There have been upticks in the number of grocery store employees who have tested positive for COVID-19 (they have been transparent to the media when positive cases are reported), and that comes from more customers in the stores. Now, at least in this area, employees and most customers are still wearing masks and sanitizing their hands and carts before they enter the store. As long as supermarkets remain essential to the communities they serve, the retailers will need to be vigilant to ensure policies and procedure set up initially are still being followed by all.

Neil Saunders
BrainTrust

Grocery and other retail workers have been on the front lines of this pandemic and everyone should be grateful for them for doing their jobs. As far as I can see, most retailers have responded reasonably with safety measures and with elevated levels of pay and bonuses. These things need to continue as the pandemic is far from over. That said, the report seems very harsh in its assessment: I don’t believe that most retailers genuinely view their staff as expendable.

Jeff Sward
BrainTrust

It’s pretty simple. The risk premium shouldn’t go away until the risk goes away. And it clearly hasn’t. In fact, it’s increasing in way too many states. Maybe the pain of paying the premium might push some of those companies to ask for a more helpful strategy from the entity that is supposed to be protecting our citizens. You know, our government? A little encouragement to wear masks and to social distance would go a long way in mitigating the upward climb of the curve. That’s proven. And yet we get the opposite.

Tony Orlando
BrainTrust
It is pretty easy to bash supermarket chains as they continue to do their best to bring products into their stores, and make the shopping experience safe. The money issue is always brought up and for those who believe that the workers need $15 hour just for starters, they simply do not understand the bottoms lines in our industry. The pandemic did create additional traffic and increased sales, which has helped the bottom lines. Most of us appreciate that, but our workers were not mistreated and all received raises for their efforts, plus personal bonuses as well. If you want examples of companies putting profits before people, just look at Nike, Apple, Levi’s, GM, etc. who shipped most of their work to China, who make products for much less and put those workers at risk with shoddy working conditions. These are mega-billion dollar companies who talk a good game, and until they start bringing back their production to the U.S. they remain hypocrites, as their actions do not put employees first. I’ll leave it at… Read more »
Lisa Goller
BrainTrust

Although we’re past the panic stage, COVID-19 still threatens health and safety.

Yet retailers’ prompt pivots have helped to minimize harm among workers and consumers. For instance, most major retailers provide PPE, limit in-store traffic, encourage physical distancing, install plexiglass shields, implement sanitation protocols, add curbside pickup, check associates’ temperatures, and heavily invest in delivery workers and e-commerce to minimize the number of people in stores.

Hazard pay was intended as a temporary solution; providing a higher minimum wage (even without a pandemic) is more meaningful for front-line workers’ long-term well-being.

One area of opportunity for retailers is to take front-line workers’ mental health seriously. Even with all the positive process changes, front-line workers still face the chronic stress of needing to work in an environment with above-average health risks for them and their loved ones.

John Hyman
Guest
2 months 24 days ago

I can’t wrap my head around the correlation between hazard pay and/or providing a higher minimum wage being “more meaningful for front-line workers’ long-term well-being.” $15/hour is meaningless if you lack substantial healthcare and are on a ventilator.

Steve Montgomery
BrainTrust

The grocery retailers we frequent were very quick to react by installing Plexiglass dividers at the checkout, not allowing any returns, requiring masks for both customers and employees, offering increased pay, offering increased time off as needed and broader medical coverage, etc.

The only question is how long these efforts should last. My vote is until the pandemic is over. The proverbial fly in the ointment is markets where customers are not required to wear a mask or if they are ignore the requirement.

Jeff Weidauer
BrainTrust

It’s true that grocers have worked harder on the optics of their response than the reality of it. Even so, I don’t agree that the industry sees its workers as expendable. It’s a fine line and continues to move.

Dr. Stephen Needel
BrainTrust

This sounds less like they are not doing enough for front-line workers and more like the preamble to the next union strike. Oxfam is not putting forth a solution, they want the companies to increase engagement with the unions – that’s their big complaint. This is America – you don’t like the place you’re working, you are free to leave. If everyone doesn’t like the place they’re working, you’re free to strike. Just don’t expect much in the way of community support. We don’t “look for the union label” much anymore.

Ken Lonyai
BrainTrust

I just went to Trader Joe’s for the first time since this started. Although there were some procedures, from a germ/virus exposure perspective, things were very lax, putting both staff and customers at risk. Going through the motions rather than maintaining safe protocols is exactly what creates dire consequences. Trader Joe’s and others need to step up yet again.

Dr. Stephen Needel
BrainTrust

Could be your Trader Joe’s, Ken — on Monday, mine in Atlanta had a masks only, shopper limit, all carts cleaned policy. Same yesterday here in Wellington, Florida.

Ken Lonyai
BrainTrust

Same thing, but masks were falling off of a number of shoppers/staff with no staff speaking up and cart “cleaning” was a team member giving each cart two spitzes of something while semi-distracted chatting with another staffer.

Oliver Guy
BrainTrust

This is significant and potentially hugely controversial. No matter how much an employer does, there are always those who would say they could have done more. It is fascinating to see how Amazon are actually running TV advertisements in the United Kingdom that include explaining how they are keeping their employees safe during these times.
Risk assessment is a key issue here – could technology have a role to play in terms of improving? Absolutely, but it cannot always be deployed overnight.

Michael Blackburn
Guest
2 months 24 days ago

Yes, it’s premature to be pulling back the bonus pay, especially as cases are increasing in over half the states. To their credit, grocers were quick to increase pay. Yet despite this cost and other COVID-19-related operating costs, most still reported not only record sales, but profits as well. A true profit sharing plan could have been considered. As for “bashing” grocery relative to other sectors, I don’t really see the grocery space acting any more ethically correct over the past years than these other players. Most of the major players are focused on the outdated theme from the ’80s of maximizing shareholder profits; profits before people. Ultimately perhaps it’s the consumer’s fault, always searching for cheap prices rather than a good value.

Craig Sundstrom
Guest

Oxfam probably has a point, but the strident tone of their “study” makes it easy to dismiss it as advocacy more than neutral observation (indeed one might argue it’s a bit opportunistic, using COVID-19 to address what it sees as longstanding systematic issues … some of them probably outside the scope of what the companies can realistically deal with).

So what (more) should companies be doing … or more to the point, what CAN they be doing with a confusing array of regulations differing between states and sometimes even within states, and certain people (in high positions) actively working to undermine what is in place?

wpDiscuz
Braintrust
"It's pretty simple. The risk premium shouldn't go away until the risk goes away. And it clearly hasn't. "
"This sounds less like they are not doing enough for front-line workers and more like the preamble to the next union strike."
"Risk assessment is a key issue here – could technology have a role to play in terms of improving? Absolutely, but it cannot always be deployed overnight."

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