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Safeway reaches tentative agreement with union, averting strike

Activists prepare to enter a Safeway store with signed petitions during a United Food and Commercial Workers rally in Washington on Feb. 19, 2020. (Alex Brandon/AP)

The owner of Safeway has reached a tentative agreement with a union representing workers at more than a hundred grocery stores in Washington, Maryland and Virginia, union representatives confirmed Thursday, staving off a possible strike at the last minute.

The two parties did not come to an agreement until 2 a.m. on the eve of a planned strike vote. The contract was ratified by a majority of the members in a vote Thursday afternoon.

A spokeswoman for Albertsons, which owns Safeway, said the company is satisfied with the agreement.

“We are pleased that 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,” Albertsons spokeswoman Christine Wilcox said in an email. “We are grateful to our team that diligently worked with the Unions to make today a success.”

United Food and Commercial Workers Local 400, which represents workers at Safeway and Giant, had taken issue with the company’s stance on retirement obligations. The negotiations continued for six months as the two parties struggled to reach an agreement.

Union representatives said the agreement would protect members’ retirement benefits. The company’s pension fund is short $1.7 billion and is expected to become insolvent next year.

Representatives of the union said that its agreements with Giant and Safeway are the only contracts in the country in which workers have guaranteed retirement benefits from a multi-employer pension plan.

“These negotiations were long and unusually complex due to the difficult pension issues we needed to resolve, but I am pleased to say we were able to reach a tentative agreement with Safeway that preserves retirement security for our members,” Mark Federici, president of UFCW Local 400, said in a statement.

Albertsons has been controlled by private equity firm Cerberus Capital Management since 2013, when Cerberus purchased Albertsons as part of a consortium of investors. The union has repeatedly criticized the private equity fund for job losses at some Washington area locations as the fund seeks to exit its investment through an initial public offering.