PCC reaches a tentative agreement with union workers, may avert strike

After months of stalled negotiations, pickets, strike threats and mounting financial uncertainty, PCC Community Markets reached a tentative labor deal with its 1,600 unionized hourly workers, both sides said Wednesday. 

The agreement, which will run two years, comes less than a week after PCC workers represented by United Food & Commercial Workers Local 3000 authorized a strike against the Seattle-based organic grocery store chain.

Union members still must ratify the deal in a vote Feb. 6, but the bargaining committee is recommending a yes vote, according to a UFCW email shared with union members and the media.

If approved, the new contract will mean the “largest wage increases ever at PCC, making PCC workers some of the highest paid grocery store workers in the Puget Sound” according to the union email.

“We are pleased that PCC Community Markets and UFCW Local 3000 reached a tentative agreement on the co-op’s labor contracts,” a PCC spokesperson said Wednesday.

A deal would also wrap up a months-long, often-rancorous bargaining process that highlighted PCC’s financial stress while exposing tensions within the union, with some members taking a much more combative approach that included picketing the now closed downtown Seattle location.

Even at this late stage, two of the 10-member union bargaining team voted no on the contract, and several union members later said they would vote to reject the contract next week.

Specific details of the tentative agreement hadn’t been shared publicly by Wednesday afternoon. But in its email, UFCW offered a general description of the deal, including that it would maintain workers’ health care plan, give workers more control over scheduling and secure pensions “for all workers.”

But it wasn’t yet clear how much more money PCC offered workers in this deal versus the offer that union members rejected Friday, when a strike was authorized. Union officials had complained that the rejected offer would have meant only a 10-cent to 20-cent increase over earlier PCC proposals.

Last year, some PCC workers said they made only slightly more than Seattle’s minimum wage, which was $18.69 in 2023 and is $19.97 this year.

Wednesday’s agreement, which was reportedly reached well after midnight, comes amid financial turmoil at PCC. After years of profitability and rapid expansion, the co-op barely broke even in 2021 and ended 2022 with a loss.

In November, PCC announced it was closing its downtown Seattle location, which had struggled from a lack of office workers downtown and had accounted for about a third of the co-op’s 2022 losses, PCC officials said. The store closed Jan. 19, leaving the chain with 15 locations.

PCC has blamed the losses on slower-than-expected sales and persistent inflation. But the co-op has also pointed to higher labor costs, notably the $4-an-hour pandemic hazard pay mandated by Seattle, Edmonds and Burien.

However, union officials said some of PCC’s troubles stemmed from a too-rapid growth strategy that has seen seven new locations since 2015 and dramatically increased operating expenses.

They pointed to the co-op’s own financial data, which shows operating expenses growing much faster than revenues since 2015.

Although the co-op’s leadership hasn’t commented on its previous strategy, Krish Srinivasan, who took over as CEO in early 2022, has emphasized PCC’s efforts to turn around its finances.

“In looking ahead to 2024, the co-op is focused on restoring and securing its long-term financial viability,” Srinivasan said in a statement in November.

PCC officials’ positive statement about the tentative agreement suggest they may see it as a necessary step in recovering that stability.

Some union members said they worried that agreement still won’t bring wages up high enough to allow employees to live anywhere near where they work.

They say turnover is already so high that some workers feel they have little choice but to take on additional work. “I make minimum wage, and the majority of the time we do the work of multiple people on a shift,” said Sunniva T. Zaratkiewicz, who works at the PCC in Columbia City and plans to vote no next week.

“I don’t hate this job,” Zaratkiewicz said, but added that “I would love to make more money.”

Zaratkiewicz and several others said they objected to initial UFCW comments, which appeared in The Seattle Times, saying the tentative deal had been “fully recommended” by the bargaining team, given that two members had voted no.

A UFCW spokesperson said the term “fully” was meant to convey that “the entire package of tentative agreements are fully, or all … recommended,” but also noted that “fully” had been removed from the later announcement of the deal.