Kroger closes two stores after raising $ 4 to workers affected by covid-19: The Kroger retail chain closed two stores in California after Long Beach passed a “Hero Pay” ordinance for workers affected by COVID-19. The “Hero Pay” stimulus increases pay for workers in retail stores and pharmacies with 300 or more employees.
“Hero Pay” is a bonus that was created due to the dangers of the covid-19 pandemic. In Long Beach, eligible workers have seen a $ 4-an-hour increase in their wages. Democratic Mayor Robert Garcia approved the ordinance in January. Other California cities have taken similar steps, with Los Angeles passing “hero pay” with an increase of $ 5 for every hour worked.
Local leaders and workers unions hailed the move, but it was not well received by employers: the Merchants Association of California requested an immediate injunction to stop the wage increase, but a federal judge denied the effort.
Kroger Alleges Losses From Salary Increase … But Profited During Pandemic
In response, Kroger began closing stores in cities where “Hero Pay” ordinances exist. The retail chain announced its intentions to close two Long Beach locations, prompting protests from workers and union members.
Kroger claimed the stores were “underperforming” and that employees had the opportunity to relocate to other locations, FOX Los Angeles reported. “Despite our efforts to overcome the challenges we were already facing in these locations, the additional payment mandate makes it impossible to run a financially sustainable business,” Kroger noted.
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Mayor Robert Garcia responded by citing a report from The Brooking Institute that Kroger had doubled its profits during the pandemic and spent “almost $ 1 billion in 2020 to buy back its own shares .” The mayor has threatened to sue Kroger over the Long Beach closures, although it is unclear why he would.
A Kroger spokesperson told FOX Business in February that approving “Hero Pay” was a “wrong move” on the part of the Long Beach City Council. The company plans to close three locations in Los Angeles on May 12, citing “Hero Pay” as the main factor in its decision.
“The mandate will add an additional $ 20 million in operating costs over the next 120 days, making it financially unsustainable to continue operating the three underperforming locations,” Kroger said in a statement. Stay connected with Krogerfeedback.pro for the latest news on Kroger stores. Feel free to comment below.