Kellogg bringing in salaried staff to reopen cereal factories as strike continues

Dive Temporary:

  • Kellogg is bringing in salaried employees and “third-party assets” to be able to reopen its ready-to-eat cereal vegetation in Michigan, Nebraska, Pennsylvania and Tennessee as a strike by 1,400 manufacturing facility staff enters its fourth day. The corporate is “implementing contingency plans to mitigate provide disruptions” of its cereals, firm spokesperson Kris Bahner stated in an announcement.
  • On social media, supporters of the employees are calling for a boycott of Kellogg merchandise similar to Frosted Flakes and Froot Loops cereals, Eggo waffles and Pop-Tarts in the course of the strike. Former U.S. Secretary of Labor and economist Robert Reich Tweeted that the strike signifies staff are “fed up with company greed and corruption.”
  • The strike follows a yr of ongoing labor unrest throughout the meals {industry}, together with a six-week strike at Mondelēz factories sparked by related grievances over working hours and pay. Kellogg’s fast response, together with submitting a lawsuit towards the employees’ union, exhibits how keen it’s to keep away from additional provide chain disruptions throughout a time of excessive cereal demand.

Dive Perception:

Kellogg staff might hope {that a} strike throughout a labor scarcity and excessive demand for cereal will rapidly win them a contract with higher pay and advantages, however the cereal big’s eagerness to outsource work and resort to authorized treatments suggests in any other case.

The Bakery, Confectionery, Tobacco Employees and Grain Millers Worldwide Union (BCTGM), which represents the Kellogg staff — in addition to these concerned within the Mondelēz strike — has raised related grievances. In an announcement, it stated that Kellogg’s proposed contract would take away premium well being care advantages, vacation and trip pay, and cost-of-living wage will increase. The union stated that 30% of the corporate’s workforce would pay greater well being care prices. It additionally stated Kellogg plans to maneuver manufacturing traces to Mexico.

Kevin Bradshaw, vice chairman of the union’s Memphis, Tennessee, chapter, informed native information station WYMT that staff are additionally dissatisfied with the corporate’s plans to remove a fee system that gave workers the chance to progressively maximize their entry-level wage.

“The corporate made $380 billion in 9 months throughout a worldwide pandemic,” Bradshaw stated. “We had family members that we misplaced, co-workers that we misplaced to COVID-19. We’re not asking them to pay greater than they’ll afford. They only don’t wish to pay it as a result of they don’t wish to pay it.”

Bahner stated that Kellogg was “disenchanted” with the union’s determination to strike. The corporate disputes the notion that the contracts they supplied staff weren’t sufficient, saying that it included pay raises and that their advantages are among the many greatest within the {industry}.

“Our proposals not solely keep these industry-leading stage of pay and advantages, however supply vital will increase in wages, advantages and retirement,” Bahner stated.

The strike takes place towards a backdrop of provide chain chaos for Kellogg, because the firm has additionally needed to cope with customers’ return to highschool and work. Gross sales of its ready-to-eat cereals fell 21% within the second quarter of 2021 in comparison with the identical interval a yr in the past, when demand had skyrocketed with most customers caught at house. In the meantime, in Kellogg’s most up-to-date quarterly earnings name, CEO Steven Cahillane stated its cereal stock continues to be impacted by provide chain points. “We’ve not been capable of get the extent of capability as rapidly as we’d need,” he stated.

In an effort to be extra conscious of demand, Kellogg introduced in September a $45 million provide chain “restructuring” at its ready-to-eat cereal vegetation that included chopping 212 jobs at its Battle Creek, Michigan, cereal plant over the subsequent two years. 

The Kellogg strike is enjoying out at a quicker clip than earlier labor disruptions this yr within the meals and beverage house. Whereas the Mondelēz strike took practically every week to start out making nationwide headlines and spurring boycotts, the Kellogg strike has witnessed each nearly instantaneously. Mondelēz started busing in alternative staff to its factories round 9 days after the Mondelez strikes started, a union chief informed Immediately. Kellogg started outsourcing two days after its strike started.

The maker of Frosted Flakes and Corn Pops additionally filed a lawsuit on Tuesday towards BCTGM within the U.S. District Courtroom of Nebraska, saying that it “seeks to recuperate damages for ongoing breaches of a labor settlement.” The corporate stated the union’s “improper actions” have the intention of inflicting “vital financial hurt” to Kellogg earlier than they’re able to negotiate a brand new contract. BCTGM had not responded to Meals Dive’s requests for touch upon the lawsuit as of press time.

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