Kellogg Co. announced Thursday it has reached a second tentative agreement with union representatives for 1,400 workers from the company who have been on strike since Oct. 5.
The agreement on a new master contract is pending a vote Sunday from picketing workers at the company’s ready-to-eat cereal plants in Battle Creek; Lancaster, Pennsylvania; Memphis Tennessee; and Omaha, Nebraska.
The results of the contract vote are expected to be released Tuesday.
Both sides previously reached a tentative agreement before union members “overwhelmingly” voted it down Dec. 5, seeking better wages and benefits.
“We value all of our employees,” Kellogg Co. Chairman and CEO Steve Cahillane wrote in a statement. “They have enabled Kellogg to provide food to Americans for more than 115 years. We are hopeful our employees will vote to ratify this contract and return to work.”
The impasse has largely centered around the company’s two-tiered compensation structure agreed upon in 2015 under which employees are divided between “legacy” and “transitional” workers. The transitional workers are newer employees who receive lower wages and fewer benefits than their veteran colleagues.
According to Kellogg’s, under the new tentative agreement pending ratification:
• All employees with four or more years of service graduate to legacy wages and benefits.
• Each year of the contract, transitional workers graduate at a rate of 3% of the plant’s headcount.
• Wage increases for all.
• No changes to health care aside from a new vision benefit offering.
• Pension multiplier increase for legacy employees.
In its summary, the company noted that all medical and prescription drug coverage will be reinstated to Oct. 5, 2021. Employees who elected and paid COBRA premiums will be reimbursed for premiums paid.
There will also be increased severance for permanent plant closings by $10,000 for each level, and a renewal of the 2015-20 plant closing moratorium for the term of the contract.
In September, the company informed employees it would be cutting 212 jobs in Battle Creek by 2023 as part of consolidation and relocation of production across its ready-to-eat cereal network in North America.
With the labor dispute now stretching into its third month, Kellogg Co. has come under increasing political pressure for its handling of the strike.
President Joe Biden released an official statement on Dec. 10 admonishing the company for its plan to permanently replace striking workers. Sen. Bernie Sanders (I-Vermont) has planned a rally outside company headquarters in downtown Battle Creek on Friday.
The last nationwide walkout among Kellogg’s cereal makers was in 1972 and lasted 21 days.
Contact reporter Nick Buckley at email@example.com or 269-966-0652. Follow him on Twitter:@NickJBuckley