Tuesday, January 6, 2004
Grocery Union Suit Against Ralphs Makes Racketeering Claims
From Staff and Wire Service Reports
The unions representing striking and locked out grocery clerks filed a federal lawsuit yesterday against Ralphs markets, adding allegations of racketeering to claims included in a state court suit filed Friday.
Both suits claim Ralphs urged union members to work under false names.
The federal lawsuit was filed on behalf of two officials of the United Food and Commercial Workers International Union as trustees of the union’s pension and benefits funds, and includes claims under the Racketeer Influenced and Corrupt Organizations Act, the federal law targeting organized crime and other conspiracies.
The plaintiffs are represented by Joseph L. Paller Jr. and Robert A. Cantore of Gilbert & Sackman in Los Angeles.
The suit contends Ralphs was required under the union contracts to make contributions to the funds on behalf of union workers, though not on behalf of replacement workers. Ralphs failed to include the union workers employed under false names in the reporting required for the trust funds, the suit alleges.
In submitting the falsified reports by mail the chain committed mail fraud, the union claims, bringing itself within the ambit of RICO.
“...Ralphs has knowingly continued to employ and/or rehired some covered employees under false names and social security numbers, and then failed to include their real names, social security numbers and hours worked on its monthly reports,” the suit alleges.
The union is asking that Ralphs be blocked from continuing the alleged practices and that the company be required to correct allegedly falsified payroll records. The suit in state court alleges Ralphs managers went to some locked-out workers with whom they had good relations and offered to provide them with false identities so that they could return to work—in some cases using the Social Security numbers of the employees’ minor children or relatives.
Union officials also said the company may have coerced some workers, especially immigrant workers, with threats that they might not get jobs unless they agreed to cross the picket lines.
Ralphs then sent those employees to stores other than the ones they worked at prior to the lockout to avoid having them be recognized, the union alleges.
As a result, Ralphs allegedly failed to provide workers with pay stubs showing their real names and Social Security numbers, a violation of state and federal law.
The Los Angeles Superior Court suit also alleges that Ralphs failed to keep accurate and complete payroll records and knowingly falsified contribution and wage reports submitted to the Employment Development Department, California Unemployment Fund and benefit and pension funds.
The alleged misconduct began almost immediately after the strike began Oct. 11, according to the state court complaint, and violated Labor Code Sec. 226(a), which requires that employers furnish workers with accurate records of pay and deductions. Because the violations were intentional, the workers are entitled under Sec. 226(e) to recover either actual damages or at a minimum $50 for the first pay period in which a violation occurred and $100 for each subsequent pay period, up to a maximum of $4,000, the suit asserts.
Sec. 226(e) also provides for an award of attorneys fees, and the suit contends the unions are entitled to recover $100 for the initial and $200 for subsequent violations—also on a per employee basis—under the Labor Code Private Attorneys General Act.
Terry O’Neil, a spokesman for Kroger Co.’s Ralphs chain, could not be reached to comment on the suits yesterday. On Friday O’Neil said the company had not yet seen the state suit, but denied the charges.
“We believe the lawsuit has little or no merit,” O’Neil said Friday. “It is against our policy to knowingly hire anyone who uses falsified documentation.”
O’Neil also said Ralphs has had a policy of not hiring anyone who worked for any of the three chains at the time of the strike/lockout. Ralphs stores are staffed by management help and temporary help, he said.
The lawsuits are another escalation of the two-month standoff between 70,000 Southern California grocery workers and the companies that operate 860 Ralphs, Albertsons, Vons and Pavilions stores from San Diego to San Luis Obispo. A federal mediator recessed talks between both sides Dec. 19 after little progress was made on the key issue of health benefits. No new talks are scheduled.
The state attorney general’s office has said it is investigating whether the chains have broken antitrust laws by forming a financial pact to share profits during the strike.
Copyright 2004, Metropolitan News Company