Kroger will no longer provide spousal health insurance benefits to its employees starting January 1, 2014, according to a an agreement between the company and several union, including Local 700 United Food and Commercial Workers union , ratified in late June.
United Food and Commercial Workers Local 700 leaders declined request for comment, but John Elliott, the spokesperson for Kroger’s Central Division in Indianapolis, says Kroger’s new insurance policy is more generous than what is required by the Affordable Care Act.
Under the agreement, Kroger will provide what Elliott calls a more stable pension fund, various pay increases, and health insurance benefits for part-time workers who work as few as 20 hours per week. The Affordable Care Act mandates companies with 50 employees or more provide health insurance to employees who work 30 hours or more per week.
“We went into this discussion knowing that we wanted to protect coverage for our part-time associates,” Elliott says.
He adds that while the Affordable Care Act played a role in Kroger’s decision, the real reason for the change in health insurance policy was the increasing cost of health care in the United States.
“There is a lot of comment about the Affordable Care Act and so on and those mandates are something that we have to factor into those discussion, but frankly, healthcare costs were going up dramatically with or without the Affordable Care Act, it just adds some specific requirements that we have to fund to deal with,” he says.
Elliott says 89 percent of union members voted to ratify the contract.
“We have a long history of working together side by side, sleeves rolled up at the table, to collaboratively solve problems together,” he says.
But not everyone was pleased with the outcome of the labor agreement.
Robert Young, who has been a Kroger employee for more than 40 years, says he is reeling from the changes in spousal insurance policies. He and his wife, Nancy, both worked at Kroger since they graduated high school. They met at their home store in Paris, Ill., and were married in 1978.
Nancy Young, who is now retired, was diagnosed with ovarian and colon cancer in October of last year, and under Kroger’s new health insurance policy, she will no longer qualify for her husband’s health insurance benefits.
“All the time we were working, we never used the insurance at all,” he says. “My wife came down with ovarian cancer and had colon cancer at the same time. We’ve dealt with that since October of last year. But now that we really need it, Kroger takes it off the table, we no longer have it.”
Young says employees at his store were not notified of the changes in health insurance policies except for a flyer posted on a bulletin board this month.
To help combat the costs of changing insurance policies, Kroger has promised a one-time $1,000 payment to compensate affected employees, but Young says they still have to pay taxes on that sum, and it will not be paid out to employees until February 2014, leaving them with one month of unaccounted health insurance.
“How long do they think that will last when you go out and try to find insurance for your spouse?”