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Delayed Toronto Stock Exchange  -  04:00:00 2023-02-03 pm EST
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Loblaw bargaining standoff a sign of heightened labour tension: expert

11/22/2022 | 05:02pm EST

Tense bargaining between Loblaw Companies Ltd. and its distribution workers in Calgary is emblematic of wider labour movement trends being driven by the pandemic and high inflation, a labour expert said Tuesday.

After months of contract negotiations, relations between the two sides worsened this week after the company served layoff notices for almost all of the 534 unionized workers at the distribution centre, said Teamsters Local Union 987 of Alberta.

Workers have twice rejected offers from the employer and are asking for better quality-of-life and wage increases, the union said.

Simon Black, an associate professor of labour studies at Brock University, said while wage increases are important to workers at a time of high inflation, there’s also an increased focus on working conditions in negotiations, such as scheduling, time off and breaks.

Recent strikes by education workers in Ontario are an example of this, where workers were asking for staffing guarantees, he said.

“They're not bargaining strictly around wages,” said Black. “They are bargaining about staffing levels, and how staffing levels affect stress levels … and how it affects work life balance.”

With the continued tight labour market, unionized workers are trying to seize on a moment in which they could make real gains in bargaining, said Black.

“If workers can’t exercise that extra kind of leverage and bargaining power they have in the labour market right now, then this window will close on them.”

So far in 2022, tensions in bargaining by Canadian workers have been at heightened levels, with the average length of work stoppages more than double last year, and the number of full-time equivalent days not worked up more than 43 per cent, according to Statistics Canada.

While inflation has made it difficult for workers’ pay to keep pace, Black said there’s also general frustration among the workers who were called “heroes” in the initial phases of the pandemic.

Combine that with Loblaw’s continued profits throughout the pandemic, and workers are less likely to want to make concessions at the bargaining table, said Black.

Loblaw put forward a decent wage increase in its offer to the distribution centre workers in Calgary, said John Taylor, business agent for the Teamsters local.

But the workers rejected it because they’re looking for more guarantees around shift scheduling and seniority, such as weekend days off and consecutive days off, said Taylor.

He said the workers once had such language in their agreement and are trying to get it back in this round of bargaining.

“This is not about the money,” said Taylor. “It’s about the working conditions.”

But Loblaw wouldn’t budge, said Taylor, adding that on Tuesday morning the company informed the union it’s applied for a lockout.

“Every time we bargain with this company is difficult,” he said.

Loblaw spokesperson Catherine Thomas said in an email the company is disappointed that its offer was “narrowly rejected.” She said the wages on offer are “some of the most competitive” in the industry with some reaching more than $33 per hour.

“During negotiations, wages and the wage structure were the most important areas for the union and our colleagues, and ones we believe we’ve addressed,” she said.

Taylor said the wage increases on offer would have seen workers make between five and seven dollars more per hour by the end of the five-year contract.

Thomas said Loblaw is preparing for a work stoppage at the distribution centre, and said it’s hopeful an agreement can be reached.

Canadian Labour Congress president Bea Bruske lamented in an emailed statement how, despite the hefty profits at Loblaw, the company isn't able to meet the quality-of-life demands of workers.

"They were deemed essential – and this employer is thanking them by serving them with layoff notices."

This report by The Canadian Press was first published Nov. 22, 2022.

Companies in this story: (TSX:L)

© 2022 The Canadian Press. All rights reserved., source Canadian Press DataFile

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Analyst Recommendations on LOBLAW COMPANIES LIMITED
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Sales 2022 56 144 M 41 954 M 41 954 M
Net income 2022 1 858 M 1 388 M 1 388 M
Net Debt 2022 3 402 M 2 542 M 2 542 M
P/E ratio 2022 20,8x
Yield 2022 1,37%
Capitalization 37 345 M 27 907 M 27 907 M
EV / Sales 2022 0,73x
EV / Sales 2023 0,70x
Nbr of Employees 220 000
Free-Float 44,6%
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Number of Analysts 11
Last Close Price 115,24 CAD
Average target price 132,95 CAD
Spread / Average Target 15,4%
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Galen G. Weston Executive Chairman, President & CEO
Richard Dufresne Chief Financial Officer
David Markwell Chief Technology & Analytics Officer, Executive VP
Robert Sawyer Chief Operating Officer
Robert Wiebe Chief Administrative Officer
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