Dear UFCW Local 455 Kroger Members,
For nearly 50 years our membership had proper oversight and access to healthcare as participants of the South Central Health and Welfare Fund. In 2019, the Company began pursuing a bargaining objective to merge healthcare funds and standardize healthcare benefits across the different Kroger operating areas. The South Central Fund provided fair oversight and good access at an affordable rate. Since the Company insisted on the closure of South Central, they have been on a path to merge funds to create savings for the Company, increase your costs, and limit access and oversight of your healthcare.
Your Local is still trying to repair the damage that was caused by Kroger’s unilateral implementation of the Company plan in 2020 and the closure of South Central. Over this time, your costs, access, and oversight should have been getting better for you, not worse. As Kroger has forced consolidation they have also implemented a control structure over your healthcare as participants of the Atlanta Fund and that is not what you bargained for.
One Local Union Has Disproportionate Voting Power Given to Them by Kroger
One Local possesses 43% of the voting power, making it impossible (coupled with the 75% Rule – See Issue #2) for the other participating Locals to outvote them and the Company on issues of substance. This affects the ability to make changes to the Plan Document or meaningful change for the participants unless it serves the controlling Local or Kroger’s interest.
Despite being one of the larger groups in the Fund, Local 455 does not have the same rights, per the Fund rules, as the controlling Local to equal voting representation and oversight at Fund meetings.
All Locals Should Have Equal Representation and Voting Power at Fund Meetings – One Local, One Vote
Your Health and Welfare Fund, in its current form, is not serving our members fairly and does not have proper governance procedures due to Kroger and one other participating Local agreeing in secret to voluntarily give themselves more power than the other participating Locals in the Fund. This provides Kroger an opportunity to operate without proper oversight from your Local Union due to a control structure Kroger has created. Each participating Local should have an equal voice and equal voting power regarding the Atlanta Health & Welfare Fund. Locals with greater voting power should not have the authority to make changes to members benefits for which they do not have a bargaining relationship.
Another change to your service due to the control structure put in place by Kroger, plan participants and their families are subjected to unnecessary dependent audits and are having issues with frequent requests to continually have to resubmit verification documentation (marriage and birth certificates, spousal affidavits, legal guardianship proof), and in some instances their family members lose coverage for an entire year. The frequency of these audits was never the case for nearly 50 years under the South Central Fund.
▪ WE NEED ONE LOCAL ONE VOTE ▪ and ▪ EACH LOCAL SHOULD BE TREATED THE SAME ▪
One Local Union Has Disproportionate Voting Power Given to Them by Kroger
One Local possesses 43% of the voting power, making it impossible (coupled with the 75% Rule – See Issue #2) for the other participating Locals to outvote them and the Company on issues of substance. This affects the ability to make changes to the Plan Document or meaningful change for the participants unless it serves the controlling Local or Kroger’s interest.
Despite being one of the larger groups in the Fund, Local 455 does not have the same rights, per the Fund rules, as the controlling Local to equal voting representation and oversight at Fund meetings.
All Locals Should Have Equal Representation and Voting Power at Fund Meetings – One Local, One Vote
Your Health and Welfare Fund, in its current form, is not serving our members fairly and does not have proper governance procedures due to Kroger and one other participating Local agreeing in secret to voluntarily give themselves more power than the other participating Locals in the Fund. This provides Kroger an opportunity to operate without proper oversight from your Local Union due to a control structure Kroger has created. Each participating Local should have an equal voice and equal voting power regarding the Atlanta Health & Welfare Fund. Locals with greater voting power should not have the authority to make changes to members benefits for which they do not have a bargaining relationship.
Another change to your service due to the control structure put in place by Kroger, plan participants and their families are subjected to unnecessary dependent audits and are having issues with frequent requests to continually have to resubmit verification documentation (marriage and birth certificates, spousal affidavits, legal guardianship proof), and in some instances their family members lose coverage for an entire year. The frequency of these audits was never the case for nearly 50 years under the South Central Fund.
▪ WE NEED ONE LOCAL ONE VOTE ▪
▪ EACH LOCAL SHOULD BE TREATED THE SAME ▪
Changes to the Trust Agreement (Fund’s governing document) require a vote of 75% of the Union Trustees
This is a key component of the control structure that makes it impossible to hold Kroger accountable on issues of substance, and solidifies power in a few individuals hands while preventing any changes to the following items:
- Amendment of the Plan Document
- Amendment of this Trust Agreement
- Selection and/or termination of Fund providers providing medical, prescription drugs, dental, vision and/or life insurance benefits;
- Acceptance or termination of an Employer participating in the Fund;
- Selection and/or termination of the Fund’s benefit consultants, attorneys and auditors;
- Selection and/or termination of the Fund’s administrator, currently the UFCW Unions and Employers Benefits Administration LLC;
- Amendment of Eligibility Rules not provided for under a collective bargaining agreement.
Deletion of the 75% Rule
These items being walled off from change are what is part of stopping reform of your Healthcare Fund. This rule needs to be deleted for the Fund to have fair and proper oversight for each participating Local and their members.
▪ NEEDS TO BE DELETED ▪
One Local Can Establish a Quorum (Officially Have a Meeting) Without the Other Locals
The quorum of the Board of Trustees consists of three (3) Union Trustees, two (2) of whom must be appointed by the Atlanta Local. As it stands today, that one Local (L1996) can have a quorum with Kroger and leave the other Locals out.
A Quorum That Includes Every Local
A quorum should require participation from a Trustee from each participating Local, ensuring that decisions affecting your healthcare are made and decided by the Local with which you have a bargaining relationship.
▪ NEEDS TO BE ADJUSTED TO ONE FROM EACH LOCAL ▪
One Local has Permanent Chairmanship of the Fund
Kroger has agreed that one Local, which holds the largest block of votes, will also have permanent chairmanship of the Fund.
A Chairmanship that Rotates Among All Participating Locals
The Chairmanship should rotate through all of the participating Local’s to create better oversight, more balance and prevents conflicts of interest.
▪ NEEDS TO BE ADJUSTED TO ONE FROM EACH LOCAL ▪
All of these items were put in place to serve someone and it is not you.
Your healthcare Fund should have proper oversight and equal treatment among participating Locals – no special rules agreed to in secret that concentrates power in the hands of just a few that does not serve the participants interest.
Why Does This Matter to You?
The way the Atlanta Fund is currently structured concentrates significant power in just a few hands—Kroger and one Local — rather than providing equal representation among all participating Locals. This allows individuals with no collective bargaining relationship with our members to direct changes to our members’ healthcare benefits and administration. These changes, affecting our members, should not be controlled by parties who do not represent them at the bargaining table.
This can affect:
- How your healthcare benefits are administered.
- How appeals are handled and whether participants have real or proper recourse.
- How future benefit changes are made.
- Whether benefit cuts can be considered without equal participation from your Local.
- Whether your Local has an equal voice in decisions affecting your healthcare.
- Does the Fund Administrator only cater to one Local who has all the power?
- Non-controlling Locals have no real input and the Fund denies vital information if it doesn’t serve the created control structure.
The quorum structure creates serious concern. In its current form, Kroger and one Local can establish a quorum (officially have a meeting) without the involvement of Local 455 or other participating Locals. This means they can make changes without the involvement of the other groups. This is not real oversight.
The voting structure creates perhaps the biggest concern. Kroger has no obligation or willingness to resolve or communicate with any other Local because only one has the controlling votes. This puts you in a bad position because it waters down your Union’s ability to provide proper oversight of the healthcare we bargained for.
In the event there is a disagreement on the Union side, pertaining to changes to anything covered under the 75% Rule, can become moot because one Local possesses 43% of the voting power and no agreement can be reached without the controlling Local.
The permanent chairmanship of one Local, combined with its greater voting power, concentrates even more control over the Fund. It also provides an incentive for that Local to agree with Kroger on changes they want to make to the Fund and provides less incentive for Kroger to deal with the other participating Locals.
Five to ten years or more without proper oversight of your healthcare benefits could present major issues if not corrected in a timely manner.
In years past, our members have forgone wage increases to secure a Healthcare Fund that works for them— not to see their healthcare and the quality of service they receive rolled backward by Kroger.
These special rules developed in secret that have been forced on you are not mandatory, do not serve your best interest, and are not a part of regular Taft – Hartley Healthcare Funds and proper oversight. Ask yourself this –
“Why were these restrictions put in place to begin with and for the benefit of whom? Why would one Local and Kroger get together in secret and agree to voluntarily give themselves more power at everyone else’s expense?” Who are the restrictions serving and benefitting, because it is not you or your families.
Kroger stacking the deck against you and putting their thumb on the scale at the Trustee table is not a part of proper administering of your healthcare benefits, it is just another way Kroger is working to undermine your rights and the quality of service our members receive.
Our CBA. Our Healthcare. Our Voice. Our Vote.
We can change what happens next.
We Want to Hear From You
How have the changes to your healthcare benefits over the years affected you and your family?
Tell us about changes you have experienced in costs, coverage, eligibility, deductibles, prescriptions, or access to care.
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