Report on Pay Equity and Occupational Segregation at Kroger: Emphasizing Sustainable Development Goals

Introduction

In June 2023, Kroger’s annual shareholders meeting addressed a motion requesting annual reporting on pay gaps across race and gender among its 430,000 employees. The motion, introduced by Sam Dancy, an African American employee and long-time member of the United Food and Commercial Workers’ (UFCW) Local 3000, led to an unprecedented apology from then-CEO Rodney McMullen for workplace discrimination. Despite his urging to reject the proposal, it passed with 51% of shareholder votes, prompting Kroger to enhance disclosure practices in compliance.

Context and Sustainable Development Goals (SDGs)

This case highlights critical aspects of SDG 5 (Gender Equality) and SDG 10 (Reduced Inequalities), focusing on eliminating wage disparities and promoting equitable workplace practices. The union’s role and corporate accountability align with SDG 8 (Decent Work and Economic Growth), emphasizing fair labor practices and inclusive economic growth.

Workplace Control and Wage Disparities

Union Influence and Managerial Discretion

Unions like UFCW play a vital role in standardizing wages and reducing disparities within occupations through collective bargaining. However, managerial discretion in hiring, promotion, and firing continues to perpetuate occupational segregation based on racial and gender stereotypes, contributing to wage inequality despite union presence.

Impact of Corporate Power

The decline of labor movements and increased corporate control have widened racial and gender wage gaps. The 2003 lockout involving Kroger and other grocery chains resulted in a two-tier contract system, exacerbating workplace inequality and challenging union solidarity. This situation underscores the importance of SDG 16 (Peace, Justice, and Strong Institutions) in fostering equitable labor relations.

Occupational Segregation at Kroger

Analysis of Wage Disparities

In April 2025, Kroger reported no significant racial or gender wage gaps when controlling for job-related factors. However, union payroll data reveals substantial occupational segregation:

1. Kroger’s workforce is divided into nine wage classifications, with standardized pay within each classification.
2. Significant racial and gender disparities exist in the distribution of workers across these classifications.
3. For example, 96% of Meat Cutters are male, and white workers are more likely to be Food Clerks, a higher-paid classification, while women are more likely to be General Merchandise Clerks, a lower-paid category.

Occupational Segregation and Wage Inequality

• Median hourly wages differ significantly: $26.75 for Food Clerks versus $17.98 for General Merchandise Clerks in California (2024).
• Such segregation exacerbates wage inequality, reflecting systemic issues beyond individual job pay.
• Similar patterns are observed at Albertsons, Kroger’s competitor, indicating industry-wide challenges.

Subsidiary-Level Disparities

Ralphs, Kroger’s higher-end subsidiary, employs a workforce that is 63% white and pays $2.24 more per hour on average than Food 4 Less, a lower-cost subsidiary with a predominantly Black and Latino/a workforce. This segregation aligns with SDG 10 by highlighting the need to reduce inequalities within and among communities.

Union Initiatives and Proposed Solutions

Bargaining Proposals to Address Wage Gaps

UFCW has introduced proposals aimed at reducing wage disparities:

• Equalizing wages of General Merchandise Clerks to those of Food Clerks within three years.
• Reducing the hours required to advance wage steps from 900 to 600 hours, enabling faster progression to top pay levels.

These measures are projected to significantly decrease the Black-White wage gap at Ralphs by 2027.

Challenges and Broader Implications

While union representation reduces inequalities within job classifications, occupational segregation driven by managerial rights and structural inequalities remains a barrier. Addressing these issues requires comprehensive strategies beyond wage adjustments, including tackling residential segregation and educational disparities, in line with SDG 4 (Quality Education) and SDG 11 (Sustainable Cities and Communities).

Conclusion

Kroger’s claim of no pay disparities within job classifications masks deeper occupational segregation that perpetuates racial and gender wage gaps. The ongoing efforts by UFCW to negotiate equitable wages and reduce occupational segregation are critical steps toward achieving SDGs related to equality, decent work, and reduced inequalities. Enhanced transparency and corporate accountability remain essential for sustainable progress.

Methodology

The findings presented are based on raw payroll data from 2021 and 2024 for UFCW Locals 324 and 770 at Kroger and Albertsons.

1. Sustainable Development Goals (SDGs) Addressed or Connected

1. SDG 5: Gender Equality
   • The article discusses gender wage gaps and occupational segregation by gender in the grocery industry.
   • It highlights the feminization of retail grocery work and the disparities in pay and job classification between men and women.
2. SDG 8: Decent Work and Economic Growth
   • Focus on fair wages, workplace equality, and collective bargaining rights.
   • Issues of wage disparities, labor rights, union negotiations, and job security are central themes.
3. SDG 10: Reduced Inequalities
   • The article addresses racial wage gaps and occupational segregation by race.
   • It discusses structural inequalities and how they affect hiring, promotion, and pay within the workforce.

2. Specific Targets Under Those SDGs Identified

1. SDG 5: Gender Equality
   • Target 5.1: End all forms of discrimination against all women and girls everywhere.
   • Target 5.5: Ensure women’s full and effective participation and equal opportunities for leadership at all levels of decision-making in political, economic and public life.
   • Target 5.A: Undertake reforms to give women equal rights to economic resources, including access to ownership and control over land and other forms of property, financial services, inheritance and natural resources.
2. SDG 8: Decent Work and Economic Growth
   • Target 8.5: Achieve full and productive employment and decent work for all women and men, including young people and persons with disabilities, and equal pay for work of equal value.
   • Target 8.7: Take immediate and effective measures to eradicate forced labor, end modern slavery and human trafficking, and secure the prohibition and elimination of the worst forms of child labor.
   • Target 8.8: Protect labor rights and promote safe and secure working environments for all workers, including migrant workers, particularly women migrants, and those in precarious employment.
3. SDG 10: Reduced Inequalities
   • Target 10.2: Empower and promote the social, economic and political inclusion of all, irrespective of age, sex, disability, race, ethnicity, origin, religion or economic or other status.
   • Target 10.3: Ensure equal opportunity and reduce inequalities of outcome, including by eliminating discriminatory laws, policies and practices and promoting appropriate legislation, policies and action in this regard.

3. Indicators Mentioned or Implied to Measure Progress

1. Pay Gap Reporting
   • Annual reporting of pay gaps across race and gender among workers (as requested in the shareholder motion).
   • Measurement of wage disparities controlling for factors such as position, tenure, hours worked, performance, geographic location, and collective bargaining unit.
2. Occupational Segregation Metrics
   • Proportion of workers by race and gender in different wage classifications or job titles (e.g., Food Clerks, General Merchandise Clerks, Meat Cutters).
   • Likelihood ratios comparing demographic groups’ representation in specific job categories.
3. Wage Differentials
   • Median hourly wages by job classification and demographic group.
   • Wage gaps between racial groups (e.g., Black-White wage gap) and gender groups within subsidiaries.
4. Union Bargaining Outcomes
   • Changes in wage scales and progression rates (e.g., reducing hours needed to reach top pay level).
   • Impact simulations of wage proposals on reducing wage gaps.

4. Table: SDGs, Targets and Indicators

Source: phenomenalworld.org