Krogers-Albertsons merger rocked by Colorado AG’s allegation supermarkets illegally colluded not to hire each other’s workers

Last week, Colorado state attorney general Phil Weiser sued to block the merger of two of the country’s biggest grocery chains, claiming that the deal would “lead to higher prices, worse service, lower quality, and reduced choice for consumers.” Weiser claimed that the deal would give the combined entity control over more than half of the state’s supermarket industry and in turn harm suppliers, workers, and “weaken the state’s supply chain resiliency,” according to the lawsuit.

The lawsuit also accused the two companies of an illegal “no-poach” agreement, in which they agreed not to hire each other’s workers while they were on strike. During a 2022 strike, which included employees at 78 stores owned by Kroger subsidiary King Soopers, the two companies reached a deal in which Albertsons would not hire striking workers and would not solicit Kroger’s pharmacy customers, according to the lawsuit. 

Albertsons’ senior vice president of labor relations, communicated the agreement in an email to his counterpart at Kroger, saying, “we don’t intend to hire any King Soupers [sic] employees and we have already advised the Safeway division of our decision and the division agrees,” according to an email quoted in the lawsuit. The president of Albertsons’ Denver division, Todd Broderick later confirmed that the agreement existed in testimony provided to the FTC, Weiser’s office wrote in the suit.

“ACI (Albertsons) and Kroger restrained the ability of Kroger’s striking union employees to find alternative employment and leave Kroger, which strengthened Kroger’s ability to resist union demands at the negotiating table,” the lawsuit read. 

The Biden Administration…