Wayne Hanley knew there was more at stake than a national grocery chain war when giant discounter Wal-Mart Canada Corp. bolstered its food retailing a couple of years ago. What he saw was a major test for the future of his union.

The United Food and Commercial Workers' health rests largely in the grocery sector, but the industry is slowly shifting to non-unionized players. At the same time, the UFCW suffers from an ongoing contraction in food processing.

The grocery business accounts for about 60 per cent of the union's membership. Trouble is, the industry is under huge pressure as Wal-Mart builds its non-unionized footprint. And major chains such as Loblaw Cos. Ltd. are increasingly feeling the heat from largely non-unionized retailers, including Sobeys Inc. and even Shoppers Drug Mart Corp.

For Mr. Hanley, the union's national president, it's a battle he can't afford to lose. If he can get the industry onside with a strategy of building membership while being flexible enough with the chains to allow them to stay competitive, he will come out on top. If he can't, his union stands to see an erosion in its single largest source of strength. Either way, it's a battle he sees as overdue - and under way.

"Maybe we as an organization haven't reacted quickly enough," Mr. Hanley said in a recent interview. "There is no better time than now, because of the economy and because of the number of inquiries and calls we get from stores on a more frequent basis ... We are focusing our resources on organizing our core sectors."

The declining proportion of unionized employees in the grocery field underlines the urgency of Mr. Hanley's task. Between 40 and 50 per cent of the industry's employees are unionized today, down from between 60 and 70 per cent two decades ago, according to Statistics Canada, companies and the union.

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