In Plea Agreement, Ralphs to Pay $50 Million to Workers Locked Out in Calif. Grocery Strike

by Mike Hall, Jul 27, 2006

In late 2003 and early 2004, some 59,000 California grocery store workers were walking picket lines in a lockout and strike over the major grocery chains’ efforts to slash health  care benefits. News stories at the time showed the picket lines were cutting into store sales and that stores deployed managers to staff stores.

One chain, Ralphs, kept its stores running—by rehiring locked-out workers through illegal means. Yesterday, Ralphs pleaded guilty in federal court to felony charges related to those hirings during the nearly five-month walkout by the United Food and Commercial Workers (UFCW).

As reported in the Los Angeles Times, Ralphs used phony names and Social Security numbers to rehire some 1,000 workers and violated federal laws regarding identity fraud, conspiracy and pension reporting requirements for the Social Security Administration and the Internal Revenue Service.

Under the terms of a plea agreement between the chain and federal prosecutors, Ralphs will pay $70 million in fines, split with $20 million going to the federal government and $50 million in a special restitution fund, most of which will be distributed to the 19,000 Ralphs’ workers who were locked out. The judge will rule on the agreement at the Oct. 16 sentencing hearing.

Greg Conger, the president of UFCW Local 324, told the Times, “Justice is finally being served. It’s been a long hard process.”

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