FTC Chair Lina Khan’s Labor Protection Push Tested in Kroger-Albertsons Merger Trial
Federal Trade Commission Chair Lina Khan’s initiative to leverage antitrust laws for worker protection is facing its first major test in a trial that commenced on Monday. The FTC alleges that the proposed merger between grocery giants Kroger and Albertsons would undermine unionized workers’ bargaining power.
Khan, known for her focus on labor market issues since assuming her role in June 2021, aims to use antitrust regulations traditionally aimed at protecting consumers from high prices to address what she views as anticompetitive practices affecting worker compensation.
Khan’s concern stems from the merger’s potential to concentrate ownership and reduce competition, which could negatively impact wages and benefits for grocery store employees. The FTC argues that the deal would lead to increased grocery prices and diminish unions’ leverage in negotiating terms, particularly in regions where Kroger and Albertsons stores are in close proximity.
The United Food and Commercial Workers union warns that the merger might lead to store closures in areas like Los Angeles and Orange County, where many Albertsons locations are near Kroger stores. Kroger’s legal team counters that the company, a “proud union shop,” will uphold collective bargaining agreements and has committed $1 billion to enhance wages and benefits post-merger.
Critics argue that antitrust laws are not meant to address labor issues, but the FTC maintains that labor market competition should be a factor in merger reviews. The National Labor Relations Board has supported the FTC’s position, urging the court to dismiss Kroger’s arguments against the agency’s claims.
Khan’s labor market focus represents a broader shift in antitrust enforcement, seeking to address the impact of corporate consolidation on workers. The outcome of this case could set a precedent for how labor concerns are integrated into antitrust considerations.
Experts suggest that while the case may ultimately hinge on grocery prices, a ruling favoring the FTC’s labor claims could pave the way for future challenges to mergers based on their impact on labor markets.