A federal bankruptcy judge has requested that supermarket operator Great Atlantic & Pacific Tea Co. increase workers' severance payments at 25 stores slated to close in the next few months, including five on Long Island.
Judge Robert Drain in the federal bankruptcy court in White Plains asked Tuesday that severance payments to workers at the 25 supermarkets be increased to 52 percent of the amount owed, instead of the 25 percent proposed by A&P. The judge also set a deadline Thursday for A&P and unions to set a plan on senior workers' bumping newer employees.
Last month, A&P announced that 472 workers could lose their jobs between Oct. 19 and Nov. 1 when it closes the five supermarkets on Long Island: Pathmark stores in Baldwin and Centereach, and Waldbaum's in Carle Place, Oceanside and Riverhead.
The judge's recommendation was reported on Tuesday by the news website NorthJersey.com. In a statement Tuesday evening, the United Food and Commercial Workers International Union said, "We have made clear to the judge that hardworking men and women sacrificed for this company to succeed. These sacrifices are real and A&P must meet its responsibilities. This is especially true when it comes to severance and bumping."
A&P asked the court for permission to change some provisions of its union contracts. A&P argued that bidders Acme Markets Inc., Stop & Shop Supermarket Co. and Key Food Stores Cooperative Inc., conditioned their purchases of 18 stores for about $600 million on being "free and clear" of all union bargaining agreements. Stop & Shop plans to take over nine Waldbaum's and Pathmark locations on Long Island, while Key Food is interested in two Waldbaum's locations on Long Island.
Last week, A&P revealed that on top of the October layoffs, a further 13,000 employees at stores on Long Island, in New York City and the Hudson Valley are at risk of being laid off by Thanksgiving. More than 4,600 workers at 45 Long Island supermarkets could be affected by potential layoffs scheduled between Nov. 12 and Nov. 26.
It's uncertain how many workers will lose their jobs. Stores that are bought may rehire workers now employed by A&P. Montvale, New Jersey-based A&P, founded in 1859, filed for Chapter 11 bankruptcy in July. A&P operates nearly 300 stores under the banners of A&P, Waldbaum's, Pathmark, Food Emporium, Super Fresh and Food Basics. A&P previously filed for bankruptcy in 2010.
Last week, A&P asked the bankruptcy court to approve about $5 million in retention payments to 495 executive and management employees to prevent them from resigning while the company sells its stores.
"If they have the money for that, they should be able to pay our severance money," said Laura, an employee at Waldbaum's in Stony Brook who declined to give her last name. "We should be entitled to all of our severance pay," she said Tuesday. "We have kept the company going for the last five years."