Empire Company Limited says a recent labour decision allowing it to offer buyouts to Safeway employees in British Columbia gives it the opportunity to improve store profitability in the province.
In a press release issued Thursday, Sobeys’ parent company said the decision, passed down by a government-appointed labour mediator, would enable it to better manage operational costs and contributed “to a level playing field for Empire to compete in B.C.”
“We are in the midst of turning around our Western Canadian stores,” said Empire CEO Michael Medline in the release. “This decision is a major building block in improving our customer service, employee relations, profitability and flexibility.”
Empire plans to convert approximately 25% of its 255 Safeway and Sobeys full-service stores into FreshCo discount banners. The first five Western Canadian FreshCo stores are expected to open in the spring of 2019 (three in B.C. and two in Manitoba), with an additional seven expected to open in B.C. in 2020.
Last week the company announced the 10 conversion locations in B.C. They include:
- Maple Ridge
- Richmond (Broadmoor and Blundell)
- Surrey (Strawberry Hills and Newton)
Empire estimated the voluntary buyouts could cost it as much as $35 million, depending on how many employees take up the offer. The company said it would also absorb approximately $10 million in closure costs related to five of the outlets that would be shuttered during renovations.
Empire did not respond to requests for comment.