Analysis from Sidney Abrams, Actuarial Consultant with the Segal Company
Under the current proposal from Vons, Albertons and Ralphs, current employees would have to pay the following amounts in order to maintain current health care benefits:
- $40 per week during the 1st year of the contract
- $70 per week during the 2nd year of the contract
- $95 per week during the 3rd year of the contract
In the future, these numbers are destined to be even higher due to the fact that the employers want to segregate all new hires into a separate, substandard plan. The group of current employees gets smaller and more expensive as they age.
Health Plan for Current Employees
“The Employer contribution rates above shall be the limit of the Employers’ obligation to the Benefit Fund, including any obligation or contribution otherwise owing pursuant to Article 15, Section A.2.”
With this proposal, the companies refuse to make contributions to the reserve fund, shifting the cost to the employees.
Health Plan for New Hires
“The Employer contribution rate will be capped at one dollar thirty five ($1.35) per hour worked by each employee that is both eligible for and enrolled in the new hire benefit plan. This capped rate shall apply through the life of this agreement.
If the cost of the Plan of Benefits set forth above exceeds the capped contribution rate of one dollar thirty five ($1.35) per hour, the Trustees are directed to make Plan changes that can be supported by the one dollar thirty five ($1.35) per hour contribution limit or increase employee contributions or a combination thereof.”
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