Macy's, unions reach contract deal

Workers at Macy's flagship store in New York City and the company reached a tentative contract deal Thursday morning after threatening to strike if contract negotiations failed.

The current contract expired at midnight Wednesday. The store, a Manhattan tourist hot spot on 34th Street, hasn't had a strike since 1972. Stuart Appelbaum, president of the Retail, Wholesale and Department Store Union, which represents the 5,000 workers including the 3,500 from the store, said contested issues included health care, unpredictable schedules, and pension plans for senior employees.

Contract details have not been revealed.

"Fireworks are nice, but if Macy's wants to be a responsible member of the New York community, they have to make sure that the people they employ are able to afford to live in the city,"Appelbaum told The Associated Press on Wednesday. Macy's is an iconic New York institution. What happens in these negotiations will set the trend for the city and for the country."

Macy's saw the threat of the strike as real and had placed ads in local newspapers including the New York Times seeking temporary workers. 

Macy's is struggling with slowing sales growth and intensifying competition on all fronts. Shoppers increasingly spend more of their money at places like TJ Maxx, and other discounters, or they don't spend money in stores at all. Online threats have reshaped the retail landscape.

Industry watchers believe that could become the country's biggest clothing merchant by next year, dethroning Macy's.

Macy's is not alone in facing new pressure from its workers.

The union representing workers at Macy's says the cost of health care for workers is unreasonable. Deductibles for a single worker is $3,000, and $6,000 for a family, according to the Retail, Wholesale and Department Store Union,

The RWDSU's Appelbaum says workers want more predictable schedules. And liberal return policies, which have become crucial in the battle for consumers who are shopping online, have cut into worker sales commissions.

In an email to The Associated Press, Macy's spokesman Jim Sluzewski said that crediting sales returns against a worker's pay is "fair and equitable."

With the Associated Press