Supermarkets to Decide on Battle Against Council

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Supermarket representatives are expected to meet this week to consider launching a legal challenge to a recently passed L.A. ordinance requiring purchasers of grocery stores to retain existing workers for 90 days.


The landmark ordinance, which the City Council passed last month on a veto-proof 11-2 vote, marks the first time the city has stepped into the hiring and firing decisions of private sector companies that do not receive city funds.


After the vote, a spokesman for L.A. Mayor Antonio Villaraigosa said he intends to sign the bill, although as of late last week he had not yet done so.


The vote was timed to news of a pending buyout of Boise-based Albertsons Inc. and its 20 L.A. stores. However, on the day following the City Council’s Dec. 21 vote, the Albertsons board broke off talks with a consortium that included the CVS Corp. drugstore chain, Cerberus Capital Management and Kimco Realty Corp.


The ordinance requires that purchasers of all stores larger than 15,000 square feet retain existing workers for 90 days after the sale takes effect. After that, the purchasing company must complete a performance evaluation for each existing employee and consider offering continued employment to all satisfactory employees.


The ordinance allows employees to file lawsuits. If the purchasing company is found in violation, it could be required to reinstate former employees with back pay.


In proposing the ordinance, City Councilman Alex Padilla said he was responding to concerns that health and safety practices among food handlers could be compromised if new employees are brought on too quickly.


Grocery store owners and business groups, including the Los Angeles Area Chamber of Commerce, say the ordinance is an unwarranted intrusion into the private sector.


They also said that public health was a flimsy justification for broadening the city’s powers. “We fail to see how the ordinance accomplishes that goal,” California Grocers Association president Peter Larkin told the council immediately before the vote.


Chief Assistant City Attorney David Michaelson said in a report to the council that “this (ordinance) is a relatively new and untested application of the city’s police powers.”

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Howard Fine
Howard Fine is a 23-year veteran of the Los Angeles Business Journal. He covers stories pertaining to healthcare, biomedicine, energy, engineering, construction, and infrastructure. He has won several awards, including Best Body of Work for a single reporter from the Alliance of Area Business Publishers and Distinguished Journalist of the Year from the Society of Professional Journalists.

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