A consortium of 30,000 union workers at Canadian food stores have gone on strike over company demands to reduce wages by as much as 25% and reduce pension benefits as well.



For their part, grocers want to remain competitive with Wal-Mart, the 800-pound retail gorilla. Who has the upper hand and why?



Please consider Ontario Loblaw workers approve strike mandate amid stalled contract talks.

Loblaw Co. workers in Ontario have overwhelmingly voted to give their union a strike mandate if Canada's largest grocery chain doesn't back down from concession demands that it says are necessary to remain competitive against its non-unionized rivals.



Over 97 per cent of members of the United Food and Commercial Workers union, which represents nearly 30,000 employees at stores under names such as Loblaws, Zehrs, Real Canadian Superstores and Fortinos, have voted in favour of a strike.



Loblaw says it must modify some of its existing agreements in order to stay competitive, as earnings have declined about five per cent from where they were five years ago.



Workers are frustrated over company proposals that would cut wages by up to 25 per cent, increase waiting times for benefits eligibility and reduce full-time jobs. Workers at those stores make between the minimum wage of $10.25 and $25 an hour, plus benefits.



But Loblaw says that it must increase efficiency to take on a growing number of non-unionized competitors, like U.S.-based retail giant Wal-Mart, which has been ramping up its focus on low-cost groceries.



"We are striving to reach an agreement that would enable the company to continue to meet the demands of today’s highly competitive retail landscape," Julija Hunter, the company's vice-president of public relations, said in an emailed statement.



"In many contracts we pay 10 per cent more than competitors and have 15 per cent less flexibility. That’s a real competitive disadvantage. That’s not sustainable," Hunter said.

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