S.F.’s proposed hazard pay increase for grocery, drugstore workers heads to full board

San Francisco moved a step closer to passing a hazard pay ordinance on Thursday that could add an extra $5 per hour to the paychecks of city grocery and drugstore workers, in line with steps taken by other Bay Area cities and counties during the pandemic.

The city Board of Supervisors Government Audit and Oversight Committee cleared the way for the ordinance to go before the full board next week.

The proposed temporary pay increases — in recompense for working during a deadly pandemic — would apply to San Francisco grocery stores and drugstores with 500 or more employees across all stores, including at least 20 employees in the city. Janitors and security contractors at those stores would also see their pay increased.

The changes would take effect for 60 days and apply to workers making less than $35 per hour or $75,000 annually.

While the changes would not affect smaller businesses, larger local chains like Mollie Stone’s, which has less than 700 employees, would be included. Owner Mike Stone said during the committee meeting Thursday that the increases would come on top of bonuses and pay bumps he has already provided to his workers during the pandemic.

“We have done the right thing for our employees, customers and community over the last year,” Stone said. He added that since food industry workers have become eligible to get vaccinated against the virus, 60% of workers at his three San Francisco stores have received a shot or have an appointment to get one, and he expects that number to increase to 90% by next week.

Some chains instituted voluntary hazard or “hero pay” last year for essential workers, like those in the grocery industry, but ended the increases last summer. The proposed pay hikes would be compensation, but also recognition of the risks those workers have taken on the job through the past year, according to Dan Larson, president of the United Food and Commercial Workers Local 648 union chapter.

“Our members have been on the front line of this pandemic when it began nearly a year ago,” Larson said. If passed by the board, the changes would mean “dignity and appreciation for the dangers of the jobs they do every day,” Larson said.

The changes could have unintended consequences, according to Ron Fong, president and CEO of the California Grocers Association. Those could include increased prices for consumers and fewer hours for employees, Fong said.

Some stores could close if faced with what he estimated could be a 30% salary increase for some workers. National chain Kroger recently said it would close some stores after Long Beach passed a hazard pay ordinance.

Other cities across the Bay Area and the state have already tacked on pay increases for grocery workers and others doing essential, in-person work.

The San Mateo City Council signed off on its own pay increases for grocery and drugstores that employ more than 750 people nationwide, in part to avoid including regional grocers, similar to Mollie Stone’s, who have been providing increased pay and benefits to workers during the pandemic.

The Oakland City Council voted unanimously last month to require large grocery stores to add $5 an hour to worker wages. Fong’s group sued over the changes and he said if the San Francisco ordinance takes effect the grocers association would consider taking further legal action.

Last month, the San Jose City Council also passed a law temporarily giving workers at large grocery stores an extra $3 per hour to compensate them for running the risk of getting the coronavirus. In late February the Santa Clara County Board of Supervisors also passed a temporary $5 per hour bump in pay for workers at large grocery stores and pharmacies. The City of Berkeley also recently approved a similar temporary increase. South San Francisco passed a hazard pay ordinance of its own in February.