Empire, parent company of Sobeys, announced strong third quarter financial results this week as the company prepares to pay out about $35 million in buyouts for its Safeway employees. Sobeys owns 50 Safeway stores in British Columbia. In the past year, it has closed another 10 Safeway locations that it plans to convert to FreshCo, the company’s discount banner.
“Clearly Sobeys was ready to pay significant money to reduce their labour costs through a voluntary buyout based on how quickly they made offers to our members,” said President Kim Novak. The company made the buyout offers just weeks after Special Officer Vince Ready handed down his decision last December that enforced concessions at stores he deemed to be struggling financially and approved the conversion of Safeway stores to FreshCo.
President Novak said that as sales continue to increase and the unprofitable stores reach profitability, she expects to see improvements for union members. “Despite a very tumultuous five years since Sobeys acquired the stores from Safeway, our members have continued to work hard for this company. In light of the reduction of labour costs as a result of the voluntary buyout and the exodus of many long service employees, I expect that Sobeys will respect and appreciate the continued service of those employees who have chosen to stay and ensure the day-to-day operation of the stores.”
President Novak added that she is skeptical of Sobeys’ aggressive expansion plan for FreshCo and is concerned about the company’s low wage model. “You can’t keep workers at minimum wage rates for extended periods of time, especially when retention is already a problem. We don’t agree that a discount banner requires discount wages and benefits.” The union remains open to negotiating wage improvements for members, she said. “Higher wages would create more stability for our members, which in turn would help Sobeys retain the employees they require to run their operation.”