Macy’s (M) iconic Manhattan store faces the prospect of a strike this week as the retailer squares off with union workers over its health plans and overtime.
Four of the department store’s New York area locations, including the 1-millon square-foot emporium on 34th Street, face disruption if Macy’s and Local 1-S of the Retail, Wholesale and Department Store Union can’t resolve their impasse by midnight Wednesday night. There hasn’t been a strike at Macy’s in New York since 1972.
“It’s outrageous and wrong for Macy’s to use ads for scab jobs as a last-minute scare tactic,” said Stuart Appelbaum, President of the Retail, Wholesale and Department Store Union in a statement.
A Macy’s spokeswoman said that because many issues have yet to be resolved, the company must be ready to continue operating in the event of a strike. “Placing ads seeking temporary replacement workers is a standard but necessary practice to ensure store preparedness in the event of a strike as our intent is to serve our customers throughout this renegotiation process.”
A union source says the biggest point of contention has been the health plan, which was depicted as being unaffordable and having too high a deductible. There is also friction around work hours on holidays.
A disruption at Macy’s could not come at a worse time: the retailer last month reported its fifth straight quarterly comparable sales decline, hurt by a heavy discounting environment in apparel, a key category, and consumer spending shifts away to areas like home improvement. The Manhattan flagship is by far the biggest store in the fleet and is crucial to marketing the overall chain.
The potential labor dispute comes amid a push by retail and restaurant workers to raise the U.S. minimum wage to $15 per hour.
While Macy’s and the union have until midnight Wednesday night to reach a deal, it is entirely possible negotiations could go past the deadline, as they did in 2011, when Macy’s workers also seemed poised to strike but ultimately did not.