Two days of negotiations earlier this week failed to produce an agreement between Kellogg Co. and the union representing employees at its cereal plants.
Thus, 1,400 employees in the Bakery, Confectionery, Tobacco Workers and Grain Millers’ International Union — including 480 in Omaha — are continuing to strike.
In what Kellogg Co. called its “Last Best Final Offer” to the union, the company wrote in a Wednesday post that it proposed an agreement that would increase wages and enhance benefits for all employees, increase pension multipliers for legacy employees (defined as those who have been employed since before 2015) and no longer propose a permanent two-tiered wage and benefit structure.
The company’s proposed contract did not pass muster with union leaders, one of whom said the company proposed keeping the tiered structure put in place under the previous labor agreement in 2015. That agreement expired Oct. 5.
According to local union President Dan Osborn, most employees currently on the lower tier wouldn’t be eligible to ascend to the legacy tier for another 10 years.
“We would like to see a more timely path for those lower-tier employees,” he said. He added that the union would like to see lower-tier employees ascend as experienced employees retire.
Osborn confirmed that the union will not bring Kellogg’s proposal to a vote among union members. He said members have learned from making concessions in 2015.
“We are not willing to take concessions during this time like we did in 2015 when cereal sales were down and projected profits were down,” he said. “Not during a time of economic growth. Not during a time when our CEO (Steven Cahillane) is taking a 20% increase in his compensation (and) high-level executives have all taken increases in their compensation.”
According to Salary.com, Cahillane’s compensation totaled just over $11.66 million in 2020. In 2019, his compensation was just over $9.69 million.
Kellogg Co. said its offer expires at 11:59 p.m. Nov. 11.
“The union continues to insist on proposals that are unsustainable and unrealistic,” the company wrote. “They’ve proposed adding costs that would threaten the future success of our plants and cereal business.”
Kris Bahner, a Kellogg spokeswoman, said in an email Friday that the company has offered to continue the current pathway to legacy wages and benefits with significant wage increases for current and future transitional workers. The company, she wrote, has proposed maintaining the cost of living adjustment for legacy employees and enhanced benefits for all employees.
Kellogg asks that the union to allow workers to vote the offer, Bahner wrote.
"We remain ready and willing to consider any realistic offers from the union and hope we can reach an agreement soon so our employees can get back to work and back to their lives," she wrote. "In the meantime, we have a responsibility to our business, customers and consumers to run our plants, despite the strike. We are continuing operations at all four plants with other resources."
With striking employees currently earning only $105 per week, Osborn said a lot of employees have taken on other jobs to keep up on bills. Osborn said the union is going to create food pantries to help striking workers.
“All of us really believe that we’re fighting to save middle class and good-paying blue-collar jobs right now,” he said.