On Tuesday, February 16, grocer QFC announced that it would close two Seattle stores this spring: one in Wedgewood and one on Capitol Hill (the 15th Avenue East location). A statement from the grocer says the decision was “accelerated” by the recent hazard pay bill passed by the city council, although QFC also noted that the two stores were “underperforming.” The locations will remain open for the next 60 days, through April 24.
“When you factor in the increased costs of operating during COVID-19, coupled with consistent financial losses at these two locations, and this new extra pay mandate, it becomes impossible to operate a financially sustainable business,” the statement from the company read, in part.
As for what will happen to the employees at those locations, corporate affairs manager Tiffany Sanders tells Eater Seattle, “We are working with our associates on the specifics at these two locations and will do our best to relocate when that is possible. We will honor all contractual commitments.”
Seattle’s hazard pay mandate is a $4 per hour increase that applies to those covered by the minimum wage law who work at supermarkets with more than 500 employees worldwide and at stores bigger than 10,000 square feet. Businesses impacted by the rule include stores with a wider presence beyond Seattle. QFC’s parent company is grocery giant Kroger, which announced the upcoming closure of two of its stores in Long Beach, California, after the passage of a similar hazard pay bill in the city.
The new announcement also follows on the heels of a contentious back-and-forth between PCC Community Markets and local union UFCW 21, representing Washington retail workers. Not long after Seattle’s council passed its new law on January 25, PCC’s CEO Suzy Monford released a letter contending that the bill would unfairly hurt the co-op’s business, since it didn’t have the resources or profit margins of larger chains.
Moford’s letter was met with backlash from PCC workers and customers, and PCC eventually agreed to give the $4 per hour pay boost not just to Seattle workers, but to all of its nearly 1,500 union-represented staff at 15 locations throughout the Puget Sound region. It wasn’t alone. Trader Joe’s also recently decided to extend hazard pay to all its workers across the U.S., although the grocery chain is now canceling mid-year raises.
Meanwhile, two industry groups — the Northwest Grocery Association and the Washington Food Industry Association — also recently filed a lawsuit against Seattle, alleging that the hazard pay mandate unconstitutionally inserted itself into collective-bargaining agreements and showed favoritism toward employees at larger chains, rather than help all grocery workers.
The fate of the lawsuit remains unclear, but it hasn’t seemed to deter local lawmakers from considering policies in the same vein. On Friday, February 12, King County council members introduced yet another piece of legislation that would essentially extend the temporary raise to eligible grocery workers in a much wider area: all of unincorporated King County.
As for the QFC decision, UFCW 21 didn’t mince words in its blistering statement: “Today’s announcement by Kroger to close these two Seattle QFCs is a case of over-the-top greed and bullying, and it shows how out of touch Kroger is with our community. The public overwhelmingly supports hazard pay and supports our grocery store workers.”