Kroger Backtracks on Asking for Excess 'Hero Pay' to Be Returned

In 2018, Kroger—America's largest owner of grocery store chains—spent $752 million on advertising, according to data from Ad Age. And yet, this week, a mere $461.60 nearly may have undone all the goodwill millions can buy.

On Monday, a Twitter account going by the name "steele" posted an image of a letter addressed from the Kroger Payroll Department explaining to a redacted employee, "As you may be aware, you were overpaid your Emergency Pay in the gross amount of $461.60"—then asking for repayment in full. "Failure to repay the overpayment could result in further collection efforts," the letter added in bold.

In the days since, the post has attracted a lot of attention—racking up nearly 30,000 retweets—eventually garnering a response from the official Kroger Twitter account. Unsurprisingly, the grocer has decided to let this financial disagreement slide. "Thank for your reaching out," their tweet begins. "We've instructed our payroll department to directly inform the small number of associates affected by the recent overpayments of Emergency Leave of Absence pay that we will not seek repayment."

The timing couldn't have been much worse for Kroger. Last week, the chain came under fire for ending its $2-per-hour, so-called "hero pay" bonuses staff had been receiving for nearly two months on May 17, despite employees' concerns that their jobs were no less dangerous than before. As the Detroit Metro Times reported, after the backlash, Kroger announced a new "Thank You Pay" program that would be issued in two lump sum installments, with the second arriving on June 18.

So how did Kroger Payroll let an overpayment gaffe happen during such tumultuous times? It's not entirely clear. According to the Cincinnati Enquirer, based in the grocer's hometown, a Kroger rep was only willing to say it was "an unfortunate payroll accounting error" that affected employees who were paid to stay home due to illness (COVID-19 or otherwise) or other quarantine requirements.

The labor-sympathizing Dissent Magazine reported that these letters had been sent to multiple frontline workers at Kroger, with the UFCW Local 400—a union representing Kroger employees—writing that they "received numerous reports of Kroger members receiving collections letters from the company alleging that they were overpaid 'emergency pay' while on sick leave." (This language would seem to imply that workers may not have been intended to receive "hero pay" on top of their paid "sick leave" while at home, but, again, the source of the payroll snafu is not entirely clear.)

In Kroger's defense, the company says it's spent about $700 million to deal with the coronavirus pandemic, including additional pay to employees. And the grocer is far from the only major company with plans to phase out coronavirus-related worker bonuses: Yesterday, the Detroit Free Press reported that Costco, Whole Foods, CVS and others likely have end dates for their bonus pay arriving in the next month—though extensions are still possible.

But looking back to Kroger specifically, the company also reported net earnings of $1.659 billion for its most recent year. That's not to say that employee pay doesn't add up, but all of this does put 461 bucks into perspective—pandemic or not.