HWFC Membership Meeting June 18, 2018

June 2018 Membership Meeting. Photo by Barry Koblenz | BaseTwelve Photo

Board President, Carolynn Presser started the meeting at 6:20 by announcing that we had reached quorum

Jim Kaufman, a co-chair of the GRC, presented a slide show of GRC meeting highlights. (All slide shows for this meeting are available on honestweight.coop under Membership meetings.) Jim shared that the GRC had:

  • Appointed Saul Rigberg as the GRC representative to the bylaws panel to replace resigning representative, Judith Brink;
  • Selected Muriel Miller as the Committee notes taker;
  • Created ground rules for conduct at GRC meetings and a pamphlet to post on the website;
  • Revisited proposed bylaws left from November 2017 and sent amendments to the bylaws panel requesting action on Sec 471;
  • Appointed Janice Adams, an applicant for the position of notes taker, to fill the seat made available by Chris Gockley’s resignation;
  • Reviewed the anti-harassment policy drafted and passed by the Board; and
  • Met on May 14 and June 11 and had scheduled a meeting for July 10. [Ed. Note meeting date was a typo – should have been July 9].

Jim Kaufman also reported that he was disappointed with the absence of a “hostile workplace” prohibition in the anti-harassment policy. He also mentioned that the GRC was investigating a “complaint filed regarding the Board’s action on Co-op Voice” for which it hopes to have a resolution soon. He reported Ursula Abrams has been working diligently on the Committee’s project to retrieve missing documentation.

Next up was the Membership Committee report which started off with Chair, Judith Brink, inviting all Committee members to the stage: Alan McClintock, Cathy Holmes, Janet Sorell, Susan Keegan, Sue Longtin, and Richard Clandorf. Each member shared a little about himself or herself. Before starting her slide show, Judith asked for a show of hands from those who contributed to making the Membership Meeting happen. Judith let the membership know that the Committee was also responsible for producing and updating the Member-Owner Manual, setting-up Membership Meetings, and advising the Board on ways to improve participation. She added that the Committee also has on-call people who will help out when needed.

She also explained that the Committee recruits ‘Mail Mavens’ to get Membership Meeting notices out. They would like the job to be obsolete, however, so she encouraged Member-Owners to sign up for emails. Judith disclosed that in her role as an orientation leader, she had seen participation in orientation for new members drop from 20 people twice a week to the teens. She noted that the ‘Folder Friends’ who put orientation folders together on Sunday mornings could use more help and that interested members should let the Committee know.

Cathy Holmes from the Membership Committee shared the success of the Coffee House, which started just last October. She encouraged attendees to come the third Saturday of each month at 6:30 pm and sign-up to play, read, or share their talent. Performances start at 7 pm with first come, first perform until 9 pm. Cathy noted that that more women and Co-op members are needed.
Judith described the celebrations that the Committee is organizing. To celebrate Member-Owners with chocolate and coffee, the Committee held the Cabin Fever Social last February and is planning an Ice Cream Soiree, for August 19th from 2-4. Non-dairy treats will be available with leftovers going to the staff. She noted that the Committee is also planning the five-year anniversary celebration [which was held to great success on June 23rd].

Judith also announced that the Committee wants our ideas for community gatherings.  Using yellow slips that were handed out, Member-Owners suggested things like sewing groups, a poetry slam, a book club, a volleyball team, a dinner social and kayaking.

Yevette Buddeau introduced herself as the Member-Owner Coordinator and shared a list of activities that are planned for the June 23rd anniversary celebration. She implored the membership to come and help, especially with breakdown at the close of the event.

At @ 6:40, Carol Ostrow, of the Communications Committee, introduced herself and showed the membership a cardboard house she had created for holding suggestions from members. She said the committee is planning a new newsletter under the governance of the Board. She showed a slide with four color and positioning options for the logo she is designing for the newsletter, which she announced will be called “Honest Slate.” Her intention for the logo was to communicate boldly while ensuring it looked like it belonged to a supermarket. She was looking for members’ feedback on the final logo.

Carol continued by describing the newsletter, which she said would incorporate the current Co-op Connections and the Inside Scoop in order to connect everybody in the co-op community: staff, Member-Owners and management. Carol also reported that the new newsletter would not be trying to replace anyone. She ran through the newsletter’s proposed column names and features including a Grocery themed column called “End Cap.” Carol also announced the Committee was looking for a project manager – someone to drive the schedule.

When asked why members were not voting on the title, Carol explained that the Board had voted on the title and followed with, “When the Board says jump, I just say how high.” Participants continued to question why they could not vote on the title. Board member Janet Sorell explained, “I guess theoretically they could.” She continued that the Membership didn’t decide on Coop Scoop, Co-op Voice, or other newsletters. “If there are objections to the name, we are open to hearing them. Let us know,” said Janet. In responding to a question, Carol asserted that the newsletter would be just for members.

Paula Weiss, Member-Owner and Co-op Voice Editor, pointed out that a group of Member-Owners named the Co-op Voice and that Carol Ostrow would remember that. Janet replied, “I was there too. We decided on a name.” Janet went on to explain that the Committee is just like a group of Member-Owners. Paula commented that the Communications Committee is a committee of the Board, not just a group of Member-Owners. This discussion went on for a bit.

Further News From Inside the Co-op

At @ 7:00, President of the Board Presser called for the conclusion of the presentation and introduced current Board members in attendance: Chris Dorando, Russell Ziemba, Alexis DeLaTorre, and Janet Sorell. She stated that the Board would be appointing two new Board members at the next meeting. Any Member-Owner interested in being appointed to the Board should let her know.

Chief Cooperative Officer (CCO) Rick Mausert followed this announcement with the Financial and Operational update slideshow presentation. He shared that we have a $27,000,000+ sales year-end projection producing a $100,000 delta over the required EBITDA (earnings before interest, taxes, depreciation, and amortization). [Ed. Note: Rick has confirmed to the Co-op Voice that sales were indeed above $27,000,000 at fiscal year close, pending the audit.] The EBITDA indicates our ability to pay back loans. He reported sales gains in several departments: Grocery, Food Service, Wellness, Dairy, Cheese and Bulk. Rick thanked the store’s workers for making this possible. He shared marketing techniques that we are using like the Times Union wrap-around ad, coupon offerings, the vehicle charging station, events like the Homegrown Happening, which we will do again this Fall, deeper storytelling about products in each department as well as articles and ads in Edible magazine. He explained the renovations made to the Empire State Plaza site and its new food offerings. (Photos are available at CoopVoice.com, the November 15, 2017 issue.)

Explaining that we continue to buy local, reward customers, and remain mission focused, he offered several examples of how we are fulfilling our mission:

  • A $10,000 contribution to the Food Pantries of the Capital District;
  • Purchasing from Adirondack Creamery, which gives 50% of its profits to help Syrian refugees;
  • Celebrating our-five-year anniversary with Arbor Hill Development Corp. to raise funds to help community kids; and
  • Providing free educational programs to the community.

He concluded with the good news that our three-year forecast shows us well ahead of the required EBITDA and that our Shareholder loan balance is under $600,000 – with 51% paid. There was no time for questions and Carolynn introduced the Staff Wage Expense Proposal.

News From the Staff

At 7:20, Martha Moskowitz presented a slide show entitled, “Employee Wage Concerns” explaining that this was not a budget presentation but rather reflected Staff concerns about how values are manifested in the budget. Staff identified ways to move forward and welcomed ideas. Effective for January 1, 2019, the state-required minimum wage will be $11.10 per hour. With the dollar add-on to the state’s minimum that HWFC has historically used, the new HWFC minimum wage would be $12.10/hour effective for 1/1/19. If HWFC implements the new required minimum wage with its dollar adder, about 77 employees currently being paid between $11.40 and $12.10 will see a wage increase in 2019.

About 64 employees, being paid between $12.10 and $15/hour, however, will see the size of their earned merit and longevity wage increases diminished when compared to the now increased wage of less senior employees — a phenomenon known as wage compression. At the moment, no comparable wage increase is currently in place for them.

Martha continued by asking the Member-Owners to think about what is moral and what will encourage longevity of employment. She recounted how Member-Owners and employees had brought their concerns to the early spring budget sessions with questions such as, “Does wage compression fit our model of People, Planet, Profit?” Martha also described HWFC’s wage disparity — with most staff earning below the living wage of $15/hr. If the highest paid employees make 5.7 times that amount, she asked, does such a system reflect our values if values are manifest in how we spend our money? She wondered out loud whether the Co-op has any plans for improving staff wages.

While the Critical Objectives for the 2018-2019 budget listed “prepare for wage increases and related costs,” the Staff would like the Board to pay urgent attention to wage disparity, improved wages, and decreasing turnover. In an effort to increase attention to this issue, over 20 staff members attended the May 1 Board meeting. As staff spokesperson for that meeting as well, Martha recounted how she had explained that the deli positions and the dishwasher Food Service positions, in particular, have enormous turnover. Most of the 60 people employed in Food Service are at the bottom of the wage scale. These are the most relentless, demanding, high customer-service jobs. Dishwashing is fundamental to the deli and she reported the Department had been through five dishwashers since January. A temp agency that charges $20/hour to fill the position was used for a while, she added. “What if the dishwasher was offered a higher rate to begin with.” she asked.

In their thoughtful consideration of what can be done to address these problems, staff suggests tiered wages for deli and housekeeping and offering a living wage. However, the obstacles to these solutions are myriad, said Martha. We learned from our chief fiscal officer that it would cost $500,000 to get acceptable wages. But, she added, that is unachievable — asserting, we can’t just decide to make more money. Our expected 2018/2019 EBITDA margin is very narrow. What do we do? She shared that the Board promised that 25 percent of the earnings above EBITDA would go to bonuses but what other suggestions are there to address this problem? She shared some staff suggestions:

  • Freeze upper management salary believing it fair for them to wait for their salary increase, in solidarity with lower-wage employees;
  • Finding $2,000 at a time to put towards the problem;
  • Providing deli workers with weekly 30-hour shifts, a 25-cent raise and re-prioritizing personnel expense;
  • Introducing fundamental shifts in our wage philosophy with Bylaws amendments, such as a wage ratio of 1:3. With this ratio, if the lowest staffers were paid $15, the highest paid salary would be capped at $90,000. Martha acknowledged the potential challenges in finding skilled people agreeing to work for this capped wage when it is less than market rates;
  • Introducing salary transparency;
  • Eliminating (or charging for) paper bags.

As an example of how cost savings can happen, Martha recounted how operations staff had found a different plastics provider last year to save money. She closed with the message that staff wants to be progressive and wants your ideas – adding a quote from HWFC’s Mission Statement:

We welcome all who choose to participate in a community which embraces cooperative principles, shares resources, and creates economic fairness in an atmosphere of cooperation and respect for humanity and the earth

She asked for questions and suggestions.

Member-Owners gave Martha a very warm, lengthy, round of applause and rose to her call for questions by providing significant and very positive feedback, including a frequently mentioned regret that HWFC was not already adequately valuing staff. Many suggestions for increased wages were provided, such as implementing more Member-Owner time investment, reducing the number of paid staff, and lowering the discount.

[Ed. Note: The packet for the July 10, 2018 Board Meeting contained a proposal from Board Member Janet Sorell on increasing the Staff’s Bonus Pool. The proposal listed several funding ideas heard at the Membership meeting such as diverting Member-Owner discounts on a voluntary basis and charging for paper bags. Ms. Sorrell added some new ideas like creating a bag token and holding a Reduce, Reuse, Recycle Yard sale — both to further fund the staff bonus pool. It was good to see a Board member make a proposal. The Co-op Voice looks forward to further discussions on this topic.]

Café Plans

At nearly 8pm, CCO Rick Mausert returned to the podium with a presentation on the café proposal. Ballot boxes were opened. Rick explained that his objectives were to: increase seating comfort and functionality (mentioning that his choice for new chairs were made from recycled plastic); introduce a safe and pleasant outdoor seating space; and generate additional sales for the café. Rick estimated that the improvements could generate 125 more meals per week, bringing in $78,000 in additional sales.

Member-Owners had several questions, many directed at one of the redesign options with features that repositioned some seating space on risers, apparently making the space inaccessible to visitors with mobility issues. The Board was questioned on their decision to sanction inaccessible space and failure to provide a formal feedback mechanism. (Rick did mention there had been two feedback sessions before that evening’s meeting.) Compliance with the Americans with Disabilities Act or ADA was discussed. Janet Sorell explained she did not personally view Board action as sanctioning the designs, but as letting the Membership decide.

Participation continued with questions about: placement of the composting station and how HWFC anticipated increasing deli production (to serve the increased café visitors) with little space in the kitchen. A Member-Owner who is also a staff member said staff is barely able to finish their duties in time as is. She continued by describing why she was offended by the proposal — for the burden it puts on co-workers. Other comments included focusing instead on solving wage compression and concentrating on the people making the good food. Other commenters questioned the minimal increase in seating, adding alarms to the outside fence gates, and the design’s apparent adverse impact on the perennial garden and smooth stones/ permeable paving. Rick shared that the cost of the design was $1,500 and concluded his presentation.

Open Discussion began at 8:19. Members expressed their hope that the plan for the outdoor café did not represent a retreat from the mission of People, Planet, Profit, towards Profit, Profit, Profit. In response to a question about his earlier financial report, Rick explained that the margin narrows in the second year because several balloon payments and shareholder loans become due. Responding to another question about how the main store, which already had difficulty keeping the Empire Plaza site supplied with salads, was going to come up with extra food when the café was also demanding more production. Rick explained that the deli manager in accepting the plan said he wanted to invest in an industrial grill and do cooking outside.

Other suggestions for increasing productivity included adding another employee restroom because employees are not effective in production while waiting in line for the few bathrooms we currently have. The discussion came to a close with a return to the issues of the minimum wage and whether the café was taking priority over staff wages. Janet Sorell spoke up saying she thought some comparisons in the staff presentation weren’t quite accurate, adding that wage transparency may be great in a big corporation, but that in a small entity, it can be toxic. She closed with the thought that, ideally, a 1:3 ratio would be great, but we have to look at what kind of salaries we are competing against. It is her belief, she said, that all employees had to be compensated and she suggested that we could ask members to forgo part of their discount to go toward employee wages. Ballot boxes were closed and the meeting was adjourned at approximately 8:30pm.

[Ed Note: The Inside Scoop reported the next day that the café vote showed 74% of responders favored making no change in seating and 76% wanted no change in fencing. Rick also reported to the Co-op Voice that café plans were now on hold.]