Stop & Shop Situation A 'Serious Concern': Massachusetts Treasurer

MASSACHUSETTS — Massachusetts State Treasurer and Receiver-General Deborah B. Goldberg, along with the state treasurers of Connecticut and Rhode Island, have sent a letter to Stop & Shop and its parent company, Dutch-Belgian multinational retail and wholesale holding company Ahold Delhaize, expressing "serious concerns" about the possibility of the company to "eliminate union health insurance" and "threatening to shift warehouse operations out of Massachusetts."

Last week, the Teamsters union threatened to set up picket lines at all New England Stop & Shops — amid animated verbal wrangling over a distribution center contract in Freetown.

Demonstrations could begin at the end of this month, according to a negotiation deadline.

The dispute centers around Teamsters members accusing Stop & Shop of "pushing" employees at a distribution center in Freetown, to accept what the union considers a substandard health care plan. Stop & Shop officials are saying the company is trying to cut "high" operational costs at the center.

"Stop & Shop is driving forward a multi-year strategy that includes efforts to lower prices and improve the in-store experience," a statement from the company said. "An important component of this is reducing overall costs — and that includes the high operational costs at our distribution facility in Freetown, MA. Stop & Shop solicited and received third party bids showing we could achieve millions in annual savings by transferring the work done at our Freetown distribution center to a third party. Because of our commitment to our union associates, we approached Teamsters Local 25 leadership with a request to identify only a fraction of that annual savings in our new contract."

The situation raises "serious concerns about the long-term stability of the company and its relationship with employees, customers, and the communities it serves," according to the letter from the state treasurers.

The letter is addressed to Frans Muller, the president and CEO of Ahold Delhaize in Amsterdam; and J.J. Fleeman, the CEO of Ahold Delhaize USA.

Here is the full transcript of the letter:

"Dear Mr. Muller and Mr. Fleeman,

"As the state treasurers of Massachusetts, Rhode Island, and Connecticut, we write to express
our deep concern regarding the ongoing labor dispute between Stop & Shop and Teamsters
Local 25. Stop & Shop plays a vital role in our states—serving our communities, employing
thousands of workers, and contributing to our local economies. We value the company’s
presence in our states, just as we value the well-being of the workers who make your business
run every day.

"Reports that Stop & Shop has proposed eliminating union health coverage and is threatening to
shift warehousing operations out of Massachusetts if workers do not accept these terms raise
serious concerns about the long-term stability of the company and its relationship with
employees, customers, and the communities it serves. A strike impacting over 900 Teamsters,
as well as potentially 30,000 UFCW members throughout New England, would have
far-reaching operational and economic consequences.

"Beyond the immediate disruptions, such a dispute poses a significant reputational risk to Stop & Shop and Ahold Delhaize. The company has built a strong customer base over decades, in part because consumers trust that it treats its workers fairly. A labor dispute of this magnitude risks eroding that trust, driving loyal customers to competitors and causing lasting damage to Stop & Shop’s brand. Today’s consumers are increasingly attuned to how companies treat their workforce, and widespread media attention on a prolonged labor conflict could lead to substantial backlash, negatively impacting both short-term sales and long-term market position.

"We recognize that businesses with strong labor relations and fair employment practices tend to
deliver more stable and sustainable returns. We urge Ahold Delhaize to engage in good-faith
negotiations that prioritize both its workforce and its long-term corporate value. A resolution that
ensures fair wages, benefits, and working conditions will not only protect your employees but
will also safeguard Stop & Shop’s reputation and long-term success in our states.
"We welcome the opportunity to discuss these concerns further and look forward to your
response."

The letter is signed by Goldberg, Connecticut State Treasurer Erick Russell and Rhode Island State Treasurer James Diossa.