Grocery chain Kroger has been forced to close two local stores in southern California because the retailer can’t afford to continue paying workers an additional $4 per hour in “hero pay” stemming from the COVID-19 pandemic.
The two Long Beach stores, Ralph’s and Food 4 Less, closed their doors on Saturday as staffers emptied shelves and packed up equipment, the Daily Mail reported.
Kroger officials noted that the closures stem from the fact that the two locations were “underperforming stores,” a term likely meaning that it was costing more to keep them open than they were earning.
The decision to pay workers the additional $4 per hour was not made by Kroger but rather via city ordinance. Long Beach officials passed a “hero pay” requirement in December which mandated that retailers and pharmacies which employed 300 or more workers overall, or more than 15 people per location, to pay the higher wage as compensation for working during the pandemic.
Kroger noted in February, in response to the city’s mandate, that it would not be financially possible to keep the two “long-struggling” stores open if the company was forced to pay workers the additional wages.
“The irreparable harm that will come to employees and local citizens as a direct result of the City of Long Beach’s attempt to pick winners and losers, is deeply unfortunate,” the company noted in a statement. “We are truly saddened that our associates and customers will ultimately be the real victims of the city council’s actions.”
Kroger offered workers jobs in other stores, but some employees, including Santiago Vasquez, could not make it work.
“I was offered to stay with the company in Huntington Beach and Seal Beach,” he told CBSLA. “But I’d rather just work a minimum wage job around where I live.”
Some members of the community came to the locations on Saturday to scoop up some bargains, though there wasn’t much left.
“I came to get the last-minute deals and say goodbye to the store,” shopper Nick Savala told CBSLA. “It’s almost like you’re losing a part of your family because you get to recognize the faces you see when you come shopping. So, it’s a real bummer.”
Robert Garcia, the mayor of Long Beach, said before signing the ordinance earlier this year that grocery staffers “have been on the front line of this pandemic and deserve this support.”
In addition, he wrote that grocers have earned record profits during the pandemic as justification for forcing them to pay workers more.
The city of Los Angeles also finalized a rule requiring grocery stores to pay workers an additional $5 per hour, FOX11 reported that last month. City officials subsequently called for an investigation into Kroger after the retailer announced it would close three locations in May.
Union leaders blasted Kroger over its decision to close those locations, accusing the retailer of punishing workers and communities near the stores. An estimated 200 workers are reportedly affected by the closures.
But the California Grocers Association came out in opposition to the hero pay mandates, saying that the additional wage expense would be cost-prohibitive to many stores and do nothing to improve the health safety of workers.
About a year ago, Kroger announced it would implement a “hero bonus” in the amount of $2 per hour, the Daily Mail noted.
The bonus was paid between March 29 and April 18, 2020, to store workers as well as those in the grocer’s supply chain, in manufacturing, and in its pharmacies and call centers.
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