BNA Daily Labor: Three-Year East Coast Costco Contract For 3,500 Workers OK'd by Teamsters

March 12, 2010: Members of the International Brotherhood of Teamsters in three locals in New Jersey, New York, Maryland, and Virginia March 11 ratified a new three-year contract with Costco Wholesale Corp. that increases wages by $1.50 an hour over term and provides twice-yearly bonuses totaling between $5,000 and $8,000, based on years of service, the union announced.

Union members in February ratified a similar agreement with Costco at some 40 locations throughout California for 12,000 workers (33 DLR A-12, 2/22/10).

A tentative agreement was reached on both contracts in January, said IBT negotiations chairman and International Vice President Rome Aloise, adding that the terms of the agreements are mostly the same, except for the pension benefits.

East Coast Workers Not Offered Pensions

“Again, we see that the margin of ratification was the lowest in memory due to the members' dissatisfaction with Costco's refusal to give East Coast Costco Teamsters the same pension plan that Costco Teamsters enjoy in California,” Aloise said. “This issue will not go away and we intend to continue to pursue this issue throughout the term of the agreement.”

The West Coast contract allows employees to participate in the pension plan administered by the Western Conference of Teamsters Pension Trust Fund, which Aloise said is the largest single pension fund in the world, worth some $32 billion, Aloise said. Workers receive about $1.17 per hour worked in pension distributions. Employees on the West Coast also receive a 401(k) plan that provides employees beginning in the first year with 20 cents per hour. This increases to 60 cents per hour after 10 years experience.

Meanwhile, the East Coast contract only provides employees with the same 401(k) plan as the West Coast contract but no pension plan. However, employees on the East Coast do receive an extra profit sharing distribution West Coast workers do not receive. This takes the form of a contribution into the 401(k) plan, but is not guaranteed each year, Aloise said.

The West Coast contract is retroactive to Feb. 1, 2010, and expires Jan. 31, 2013, Aloise said. Effective March 1, 2010 and then Feb. 1, 2011 and Feb. 1, 2012, workers will receive a 50 cents per hour increase. The average hourly rate currently is $21.55. The “wall-to-wall” bargaining unit includes clerks, meat cutters, warehouse workers, stockers, and delivery drivers, Aloise said.

“The wage and bonus increases will maintain the members' distinction as the highest paid retail workers in the country,” the union said in a March 11 statement.

The contract essentially remained the same from the previous contract, other than improving language that will strengthen job security, the union said.

Costco did not immediately return a call seeking comment March 11.

By Alicia Biggs

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