Trader Joe's increases pandemic pay nationwide, while Kroger announces store closings over hazard pay mandates

Trader Joe’s has boosted extra pandemic pay for its hourly and non-management employees by $2 an hour at stores nationwide.

Now, those employees will temporarily receive an extra $4 an hour with the "Thank You" wage "in recognition of the outstanding, inspiring work they do every day, in our stores and communities," the grocer said in a blog post.

The increase comes as President Joe Biden calls on employers to provide hazard pay to frontline essential workers as part of his American Rescue Plan. City councils in Seattle and several California cities, including Long Beach and Berkeley, have passed mandates for grocery store companies to pay essential workers additional pay.

Los Angeles and other cities are considering mandates providing an additional $4 to $5 an hour in raises, also called "hero pay." 

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Many cities referenced research by the Brookings Institute that found retailers, including big grocery chains, earned "eye-popping profits" since the pandemic while doing away with hazard or hero's pay.

Trader Joe's website post does not mention the mandate but a message to employees attributed the pay increase to the recently approved order in Seattle, The Seattle Times reported.

Two grocery industry trade groups – Northwest Grocery Association and the Washington Food Industry Association – filed a lawsuit against the city of Seattle Wednesday over the new law that mandates $4 an hour pay raises for grocery stores.

The law applies to grocers with over 500 employees worldwide and stores larger than 10,000 square feet in Seattle. It mandates a $4 an hour pay boost for all workers in retail locations, a bump that stays in effect as long as Seattle remains in a declared civil emergency.

The suit alleges the city's law interferes with the collective-bargaining process between grocery stores and unions and "picks winners and losers" by singling out large grocery companies.

Stores closing in response to mandate

Not all businesses are handling the mandated pay raises the same way as Trader Joe's.

The Kroger Co. announced it will close two grocery stores, a Ralphs and a Food 4 Less, both in Long Beach, California on April 17 in response to a local ordinance requiring extra pay for certain grocery employees working during the pandemic.

“As a result of the City of Long Beach’s decision to pass an ordinance mandating Extra Pay for grocery workers, we have made the difficult decision to permanently close long-struggling store locations in Long Beach,” the company said in a statement. "This misguided action by the Long Beach City Council oversteps the traditional bargaining process and applies to some, but not all, grocery workers in the city."

A lawsuit filed by the California Grocers Association claims that the Long Beach ordinance interferes with the collective bargaining process between grocery stores and unions representing workers.

A $5-per-hour hazard pay wage increase was approved Tuesday by the Oakland City Council. In Los Angeles, the City Council voted to draft a similar ordinance. 

The Los Angeles suburb of Montebello previously approved a hazard pay measure and others are being considered in the L.A. suburb of Pomona and in San Jose and other San Francisco Bay Area cities.

Marc Perrone, international vice president of the United Food and Commercial Workers union, lashed out at Kroger for its “billions in profits because of the sacrifices of grocery workers” while recognizing city leaders for stepping up to take care of essential workers.

The food workers union, which represents 1.3 million workers in grocery, meatpacking and other industries, has been campaigning to have grocery worker hero pay, union and nonunion, reinstated.

“Rather than provide the hazard pay these grocery workers have earned and deserve, Kroger decided to threaten these workers and the community’s access to food in the middle of a public health crisis,” Perrone said in a statement.

Contributing: Susan Selasky, Detroit Free Press; Associated Press

Follow USA TODAY reporter Kelly Tyko on Twitter: @KellyTyko