Ralphs Pleads Not Guilty to Hiring Violations

Ralphs Grocery Co. pleaded not guilty Monday to charges that store managers violated federal laws by secretly rehiring nearly 1,000 locked-out workers during the bitter Southern California supermarket labor dispute of 2003-04.

Representatives of Southern California’s largest grocery chain appeared in U.S. District Court in Los Angeles, alongside shackled, orange-jumpsuit-clad suspects in other matters, to listen as the company’s case was assigned to Judge Percy Anderson.

Ralphs’ representatives, including senior counsel Mary Kasper, waived their right to have the federal indictment read before moving to Anderson’s courtroom, where they entered the plea of not guilty.

The trial is set for March 28.

According to a December grand jury indictment, Ralphs used fake names and Social Security numbers and falsified thousands of employee records sent to various government agencies to conceal the rehiring of experienced workers.

The violations reflected “tacit approval, if not encouragement, by Ralphs’ senior management,” the 53-count indictment alleged.

Ralphs’ corporate parent, Kroger Co. of Cincinnati, earlier admitted that some store managers had falsified records to rehire locked-out workers but has denied that the actions were sanctioned by the company.

“We have been willing from the beginning to pay a reasonable fine and move on,” said Lynn Marmer, Kroger’s vice president for corporate affairs.

If convicted on all counts, Ralphs and Kroger could face fines totaling more than $100 million, as well as back pay and restitution for workers and their union, the United Food and Commercial Workers.

The labor dispute was the largest and longest ever in the U.S. grocery industry. It started Oct. 11, 2003, when the union struck Vons and Pavilions, both owned by Safeway Inc. of Pleasanton, Calif. Ralphs and Albertsons Inc. had been bargaining jointly with the Safeway stores and in solidarity locked out their workers.

More than 59,000 workers at 852 supermarkets in Southern and Central California were involved in the dispute. That included about 300 Ralphs stores that employed 19,000 grocery clerks and meat cutters, authorities said.

The strike and lockout ended after 4 1/2 months, when members of the food workers union ratified a new contract that provided reduced wages and health benefits for new hires.

Even as the fallout from the dispute continues, the union and the grocery chains are set to resume contract talks in the coming year. The contract expires in March 2007.