Author: Daniela Travierso

Teammates,

We have been receiving many questions since our last Safeway Talks communication. Many employees are asking why the Company challenged the November 20, 2023, Final Offer Selection (FOS) decision, in the first place. As we have mentioned previously, the FOS decision put significant financial pressure on our business and if left unaddressed, would have continued to impact the competitiveness and long-term viability of Safeway.

The FOS decision was overturned in part because of inaccurate and irrelevant information submitted by your Union. The court recognized that the Arbitrator’s wage decision was “based on facts not supported by the evidence.” Further, the judge recognized that the Arbitrator’s decision was “unreasonably” based on market comparators of which “none are part of Sobeys’ competitive climate.” 

We had no choice but to take action on the FOS decision to protect the Safeway business.

We have contacted your Union and provided a number of dates for the parties to meet and discuss a resolution that could benefit all parties.

We urge you to fill out the Union’s survey; encouraging the Union to meet with the Company.

We are confident that we have the ability to reach a deal that works for all employees; including employees who are not at top-rate or overscale. This is why it is in the best interest of all employees, for the Company and the Union to meet.

We will continue to keep you updated as we proceed. In the meantime, here is an FAQ document that addresses the questions that have come to our attention.

As you are aware, we challenged the Arbitrator’s ruling on the Wage Reopener and we’re committed to keeping you informed on the process. As a reminder, we challenged this ruling because it put us in an uncompetitive position in the Alberta market, with top-rate wages more than 8% higher than our major competitors. We had no choice but to continue to work through the process to protect our Safeway business.

Today, we received news that the Judge determined that the Arbitrator made multiple errors in their decision, including the error of relying on wage settlements that were not part of Safeway’s competitive environment and information that was factually incorrect.  As a result, the Judge has overturned the Arbitrator’s decision and has ordered that the matter be heard again in a new arbitration.

The court recognized the errors and we are optimistic that the new Arbitrator will focus on the Alberta market and the competitive landscape in which we operate.

We recognize that this decision will cause uncertainty for our top-rated teammates. We assure you that we will share more on our path forward in the coming days.

As shared with you in August, top-rated teammates were awarded their second wage increase. This said, Safeway continues to challenge the Arbitrator’s ruling on the Wage Reopener, and there may need to be difficult decisions taken.

It can’t be reiterated enough that the wage increases for top-rated teammates have negatively impacted the profitability of the stores and resulted in many locations becoming unprofitable. Safeway is now in an extremely uncompetitive position compared to the rest of the Alberta grocery industry.

As a result, the organization is required to assess if further action is needed to address this challenging position. All options are being considered including closures, conversions, and hours reductions — any of which could result in the potential loss of jobs.

Having to make any of these choices would be extremely difficult, and the organization doesn’t take the evaluation process lightly given the potential magnitude of impact. It’s because of this reluctance to make any of these tough choices that Safeway has no other option than to continue to challenge the Arbitrator’s ruling.

Further updates and details on the judicial review process and any difficult choices that must be made will be shared with you.

In December 2023, we informed you about our challenge of the Arbitrator’s decision on the Wage Reopener. In our view, there were several critical errors made in the ruling. The information the Arbitrator relied on to base their decision was partially inaccurate and was not in line with the Alberta market and competitive landscape.

This decision, which rewards only top-rated teammates, has now put significant negative pressure on our business and creates future risks for all teammates. We can’t stress enough that these wage increases have put Safeway in an extremely uncompetitive position compared to the rest of the Alberta grocery industry.

The impact of the decision has made several of our stores unprofitable. As a result, we may have to make difficult choices to address this situation. It is for this reason that we continue to challenge the Arbitrator’s ruling.

What we want is a decision that is fair and market competitive which enables us to continue to run profitable stores while providing opportunities for all of our teammates well into the future.

As required, we implemented the first wage increase for top-rated teammates last August. At that time, we communicated that the second increase for top-rated teammates would occur this August. We are honouring that commitment and these teammates will receive their increase on their next pay.

We can’t stress enough that these wage increases for top-rated teammates have placed us in an extremely difficult position compared to our competitors. We will continue to be transparent in communicating the impact of the Arbitrator’s decision on our business and any difficult choices we may need to make as we move forward.