Stop and shop’s humble beginnings can be traced back to 1914 when the Rabinovitz family founded the Economy Grocery Stores Company in Somerville, Massachusetts. After 4 years of the grocery’s opening, Sidney Rabb came up with a new retail idea of having a self-service supermarket.
The concept was new and enticing that time thus the store flourished by 1947 with 86 shops opened and the company decided to change the name to Stop and Shop, Inc. The grocery continued to expand and by 1996 it was obtained by the biggest food retailer in the industry, Ahold, hiring an approximate of 450,000 employees and servicing 40 million customers in 28 countries (Stop and Shop, 2011).
Stop and Shop had been suffering negative media attention when employees’ contracts expired and the company decided to alter health care benefits (Bartomioli, 2007).
This paper recommends needed modifications in Stop and Shop’s employment benefit packages for the improvement of the improvement of the relationship of employees with the management especially in 3 store branches namely New York, Serbia and Deep Caverns. The first alteration in the payment package is the improvement of employment benefits and compensations. In the last negotiation of Stop and Shop and its 5 unions, the grocery giant has agreed that
“All full-time workers will receive an increase of $25 per week retroactive to February 17, when the previous contract expired; then another $20 weekly increase in March 2008 and March 2009, the second and third years of the contract. Part-timers receive an immediate 35?-an-hour increase, also retroactive, and 35? yet again in years two and three of the contract.
On the issue of health care, full-time workers who are single must now contribute $5 per week toward their health insurance premiums; married workers with spouse must pay $10, and a worker with a family $15. Part-time workers will make no contributions toward health care premiums, retaining the current practice which covers union workers’ health insurance entirely except for co-payments and deductibles” (Appel, 2007).
It would be ideal if the company would increase the amount of pay to employees by 5% annually or depending on evaluation reports based on performance. The company must also lower down co-payment of healthcare benefits to those employees who will renew their contracts upon expiration.
For employees who perform well, additional rewards should be given to them such as stock options if they are able to stay with Stop and Shop for more than 5 years. This benefit can only be given on the employees 6th year in the company. This may serve as a gratitude to the employees who have served with loyalty and faithfulness in the company.
Adjustments on the compensation packages, employee benefits especially in healthcare and the addition of giving out stock options to good performing employees who have been loyal in serving the company will motivate workers to further improve Stop and Shop’s customer service to its superior level, productivity will also increase with the “my own” mentality planted in employees’ mindsets.
Eventually the stores in the 3 branches will expand even bigger with the results produced by the improvement of employment contracts. Once compensation packages are enhance and employees are happy and content with them, disruptions such as the threat of strike from the 5 unions will no longer be a problem and operations will be efficient bringing in more profits for the company.
Appel, A. (2007, March 12). Part-Timers Keep Health Benefits In Stop and Shop Settlement. New Haven Independent. Retrieved from http://www.newhavenindependent.org/index.php/archives/entry/part-timers_keep_health_benefits_in_stop_shop_settlement/
Bartomioli, K. (2007, February 22). At Stop and Shop: No Contract, No Strike, Yet. The Lakeville Journal. Retrieved from http://www.tcextra.com/news/publish/lakevillejournal/At_Stop_Shop_No_Contract_No_Strike_Yet/92800.shtml
Stop and Shop. (2011). Company History. Stop and Shop. Retrieved from http://www.stopandshop.com/about_us/company/company_history.htm