Longtime Hy-Vee employees, now laid off, say they feel blindsided

Hy-Vee is undergoing major restructuring that's resulting in company layoffs. (Photo by: Linh Ta/Iowa Capital Dispatch)

For more than 30 years, Rick Bland dedicated his career to working for Hy-Vee.

Like many Iowa high school students, he started working for the West Des Moines-based company as a 16-year-old grocery clerk in Newton.

He stayed with the company through his adulthood.

Fast forward through 10 transfers, promotions and family moves, Bland ended up in Lamoni three years ago to work as a private brands manager and then a produce manager.

Everything ended Friday in a 30-second conversation when Bland was told his job was no longer needed due to store restructuring.

“I would have done whatever,” Bland said. “I would have done the dairy and produce altogether.”

Hy-Vee has provided few public details about employee layoffs other than to disclose upper-level restructuring at the store level, changes to its dieticians and potential “promotions, reallocations or reductions,” for lower-level store staff.

This is a part of the company’s efforts to “evolve,” in the competitive retail industry, its communications people emailed in a statement.

But for people like Bland, it feels like a push to leave long-time workers behind.

“My options are just Casey’s and Kum & Go,” Bland said. “I didn’t go to college or anything because I worked at Hy-Vee through high school and learned everything I needed to do there.”

What is happening at Hy-Vee?

On Feb. 18, the company sent out a statement saying it was restructuring its upper-level store positions.

Before the staffing changes, every Hy-Vee had a “store director,” who operated and oversaw their location. Earlier this year, some store directors were moved up to “district store director” positions, which oversee multiple locations or down to “store manager,” positions to gain training and oversee day-to-day operations.

While the upper-management changes were happening, Hy-Vee corporate asked store directors to re-evaluate their locations and become more “efficient,” though Christina Gayman, spokesperson for Hy-Vee, declined to provide details.

When Hy-Vee ended its overnight hours, it announced store directors could make staff, “promotions, reallocations or reductions.”

Changes have also been made to the company’s more than 100 dietitians, who help customers inside stores. About 30 people were moved to corporate positions, while the other positions are up to a store director’s discretion, Gayman said.

Beyond individual stores, the company also announced Friday it was ending its online fulfillment centers and repurposing its four locations, including one in Urbandale. While some of those employees will be moved to individual stores, others will need to re-apply for jobs in the company or go elsewhere.

About 300 people at the Urbandale fulfillment center will be laid off.

“Any changes we’re going to make have already happened, especially at the store level,” Gayman said. “People’s shopping habits and preferences change and they have over the last few years, but you also see the benefit of us being employee-owned is being flexible.”

Gayman said she didn’t know the total number of people who were laid off and said the company would not disclose it either way.

Consumers shouldn’t take the layoffs as a sign Hy-Vee is in financial trouble, said Jon Hauptman, a grocery store consultant with Inmar Intelligence.

For the last five years, Hauptman said, the traditional supermarket industry has been struggling due to increased competition from budget stores like Dollar General or specialized stores like Whole Foods.

Instead, Hauptman said Hy-Vee has bucked the trend by delaying laying off staff. In 2019, Kroger laid off hundreds of people.

Sales at traditional stores are down 1.7% since last year, Hauptman said, particularly in rural areas.

“Hy-Vee is an industry leader,” Hauptman said. “The actions Hy-Vee has taken to tighten their belt (are) responsible due to the fact they’ve held off longer than most have.”

Long-time worker feels blindsided

For Iowans, particularly in smaller communities, a full-time job at Hy-Vee may be one of the better-paying positions in town.

Jeri Pershy, a 55-year-old mom, felt that at her job at the Centerville Hy-Vee.

Pershy didn’t attend college and is a mom of six kids. But her full-time job as the wine and spirits department head earned her closer to $55,000 a year, including health insurance for herself and her self-employed husband.

But when Hy-Vee turned the Centerville grocery store into a “Dollar Fresh,” the company’s latest dollar-store initiative, Pershy said major changes started happening.

Instead of making homemade doughnuts for the store, the baker was sent to work in the gas station.

Brand-name items on the shelves were swapped for Hy-Vee-branded goods.

There was so much store director turnover that in seven months, they had four different leaders.

She felt that change was coming.

“I was a nervous wreck,” Pershy said. “My life is going to change dramatically at some point and I don’t have power over this.”

After 13 years of working for Hy-Vee, on Feb. 28, Pershy was told she was being let go with no severance pay.

She questions how a modern, Midwest staple like Hy-Vee can hire pro football player Patrick Mahomes as a spokesperson or open Wahlburgers restaurants, but leave behind the employees the company claims to care about.

Now she’s applying for unemployment benefits. The majority of that money will go toward getting health insurance.

“You carry yourself with a little bit of pride that you work for this well-respected company that has helped lives in the Midwest,” Pershy said. “There’s no rhyme or reason to some of the people they’re letting go.”

Bland feels the same way.

He knew all of the customers’ names. He knows the history of the company, like when it tried to sell clothes in the early ’90s and gasoline in the ’80s.

He knows the company’s mantras of what makes a good employee and took pride in providing a clean, fresh produce section to his small town.

But he also worked 45 hours a week for about $23 an hour, earning more than the majority of the people at his store.

Now, his family doesn’t have health insurance and he received only two weeks severance for nearly 33 years of work.

He wishes Hy-Vee would have given him a goal to achieve or another job option – he was willing to do whatever it takes.

“It’s so hard to comprehend that I don’t work there anymore,” Bland said. “My brain still thinks I should be at work.”


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