Kellogg's says union not 'exploring creative solutions to resolve issues' amid strike
Kellogg says it addressed the union's 'primary concerns'
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The Kellogg Co. said the union covering 1,400 striking cereal-making workers isn't interested in "revising its proposals or exploring creative solutions to resolve issues" in order to end the ongoing contract negotiations.
| Ticker | Security | Last | Change | Change % |
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| K | KELLANOVA | 81.17 | +0.15 | +0.19% |
On Tuesday, Ken Hurley, Kellogg’s head of labor relations, detailed the company's "Last Best Final Offer," which he says addressed the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union's "primary concerns."
"The bottom line is that our proposals address what the union has told us are their primary concerns," Hurley said.
However, the union disputed this claim, saying Kellogg's terms and conditions were "unacceptable to our members."
Wyatt Elmore, a 14-year Kellogg employee, raises his fist as honking cars pass by while union workers from Kellogg's picket outside the cereal maker's headquarters as they remain on strike in Battle Creek, Michigan, Oct, 21, 2021. ( REUTERS/Emily Elconin / Reuters Photos)
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In early October, hourly workers employed at plants in Omaha, Nebraska; Battle Creek, Michigan; Lancaster, Pennsylvania; and Memphis, Tennessee, first took to the picket lines, ultimately threatening production of its iconic breakfast products. BCTGM Kellogg’s members at four plants make all the company’s well-known brands of cereal, including Fruit Loops and Frosted Flakes.
Kellogg Co. Frosted Flakes brand cereal boxes are displayed for sale at a Kroger Co. supermarket in Louisville, Kentucky, on Tuesday, March 5, 2019. (Luke Sharrett/Bloomberg via Getty Images / Getty Images)
However, employees were fed up after being at an impasse at the bargaining table for more than a year over an assortment of pay and benefits issues such as holiday and vacation pay, loss of premium health care and reduced retirement benefits.
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In response to the union's request, Hurley said the Michigan-based company withdrew its proposal for permanent two-tier benefits and planned to continue with its current process "that allows transitional employees to graduate to full legacy pay and benefits. "
The company said it's offering "a pathway to legacy wages and benefits" as well as "significant wage increases for transitional employees." The company also proposed "enhanced benefits for all employees," according to Hurley.
Hurley added that the company also withdrew its plan to provide guaranteed annual wage increases instead of cost-of-living adjustments, otherwise known as COLA.
The company issued its final offer last week, but the union turned it down, saying in a statement that the "company’s proposal was filled with conditions and terms as to what was acceptable to Kellogg’s" but "are unacceptable to our members."
KELLOGG SAYS STRIKING CEREAL WORKERS CAN STILL WORK
"The Company’s last best and final offer did not achieve what union members are asking for: a predictable pathway to fully vested employment without takeaways," a spokesperson for the union said in a statement to FOX Business.
The union is arguing that the "BCTGM Negotiating Committee has proposed a progression to the company’s two-tiered system based on time, defining a pathway based on the number of years an employee is with the company. Workers have stated repeatedly they want improvements to the Company’s transitional language."
The union added that the cereal maker "continues to insist on take-aways" and that "there will only be an agreement if the union accepts the proposal exactly as Kellogg’s has written it."
Kellogg is arguing that the union rejected its final offer before even putting it before employees.
"We asked the union to allow our employees to vote the offer," said Kellogg Co. CEO Steve Cahillane. "The union immediately rejected it and told us they would not put it before employees for a vote. We implore our cereal employees to demand their union put forth the offer for a vote."
KELLOGG WORKING TO 'MITIGATE SUPPLY DISRUPTIONS' AFTER STRIKE HITS US CEREAL PLANTSo
Cahillane said the union "continues to insist on proposals that are unsustainable and unrealistic" and that "they’ve proposed adding costs that would threaten the future success of our plants and cereal business."
Union workers from Kellogg's gather with signs while they picket outside the cereal-maker's headquarters as they remain on strike in Battle Creek, Michigan. ( REUTERS/Emily Elconin / Reuters Photos)
However, the strike is already threatening the production of its cereal brands. Last month, Kellogg said it was forced to continue "operations with other resources" to try and mitigate any supply disruptions.
To help, Kellogg told striking employees that they can continue working while in the midst of a strike and won't lose out on any benefits even after its proposal was rejected.
"We want to ensure all employees that you have a right to work during a strike, and this right is protected by federal and state laws — regardless of what you might be hearing from others," Kellogg said.
The Associated Press contributed to this report