Supermarket talks expected to resume

Negotiations on a new labor contract for Southern California supermarket workers, abruptly halted Tuesday, are expected to resume next week amid a dispute over health benefits.

“We want to get back to the table,” said Rick Icaza, president of United Food and Commercial Workers union Local 770 in Los Angeles.

Both sides said Wednesday that they wanted to avoid a repeat of the contentious strike and lockout that disrupted Southern California grocery shopping for nearly five months beginning in October 2003.

The union broke off talks Tuesday over what it said was a proposal by the large supermarket chains that would gut the trust fund that purchases health insurance for workers.

But Ralphs, which along with Vons and Albertsons are negotiating a contract for a combined 65,000 workers, dropped its usual silence on labor matters and said Wednesday that the supermarket chain had offered a much improved health insurance proposal during the bargaining.

Ralphs said its proposal would tap $500 million that has accumulated in the health benefit trust fund and $1 billion in employer contributions to make it easier for employees to obtain health insurance and make other benefit improvements. It did not release more-specific details.

Vons also commented on the negotiations. In a letter to workers, Vons President Tom Keller said there had been “reasonable progress at the bargaining table.”

“We have been working hard on healthcare benefits and funding, which are complex and challenging issues. So far, the employers and the unions have tentatively agreed to make significant improvements to the health benefits our employees would receive,” Keller said.

One of the union’s priorities in the current talks is to reduce the 12- or 18-month waiting period -- depending on the job -- for a new employee to gain health insurance.

The two sides had agreed to reduce the waiting period to six months, according to people familiar with the talks. Children of employees also would be covered in six months instead of 30 months.

The waiting period for spouses would fall to 24 months from 30 months.

Union officials also have made a priority of improving pay and benefits for the “second tier,” the roughly 33,000 lower-paid workers hired by the three chains since 2004.

Before the talks broke off, the union and the employers were close to an agreement to allow second-tier employees to work their way into a higher level of benefits after some still-to-be-determined period of service. This step up in benefits, however, would still be less generous than what the 32,000 veteran employees -- the “first-tier” workers -- now receive.

Although both sides have agreed on how to improve and broaden health coverage for grocery workers, they are fighting over how to fund it.

“What they are talking about is the employers improperly funding the healthcare plan. If this went forward, we would be out of money before the contract runs out,” Icaza said.

The employers pay an average of $2.95 per hour worked into the health benefit trust fund for each employee eligible for health insurance.

According to individuals familiar with the talks, the employers have proposed paying a range of $2 to $2.50 an hour into the fund. The payments would start when a worker became eligible for coverage and the amount would change during the length of the contract.

But there wouldn’t be enough money to fund the plan as negotiated, union officials contend.

The contract for grocery workers at the big chains was set to expire March 5 but has been extended twice.

Either side must give 72 hours’ notice before canceling the contract, and neither side has done so.

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jerry.hirsch@latimes.com