Kellogg Plans to Use Salaried Staff to Reopen Plants Amid Strike

(Bloomberg) -- Kellogg Co. is preparing to restart production at four U.S. cereal plants where output has come to a halt as workers strike for better pay and benefits.

The facilities are in “various stages of preparing for startup,” Kellogg spokesperson Kris Bahner said in an emailed statement. The company didn’t say specifically when production would resume. “We are implementing contingency plans to mitigate supply disruptions, including using salaried employees and third-party resources to produce food.”

The strike was called this week by about 1,400 workers at plants in Omaha, Nebraska; Battle Creek, Michigan; Lancaster, Pennsylvania; and Memphis, Tennessee. Those locations produce cereals including Rice Krispies, Raisin Bran, Froot Loops, Corn Flakes and Frosted Flakes.

Kellogg has struggled to meet pandemic-heightened demand for its cereal. In February, Chief Executive Officer Steve Cahillane said the company was having trouble making enough Frosted Flakes, and in May, said the product remained among the cereal brands that were “bumping up against capacity.” The company is scheduled to report third-quarter earnings on Nov. 4. 

The work stoppage follows recent strikes at Mondelez International Inc.’s Nabisco bakeries and PepsiCo’s Frito-Lay plants. Despite bringing in other employees and supervisors to continue making snacks, production at Mondelez’s plants dropped during the strike.

David Woods, International Secretary-Treasurer of the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union, said the company may have trouble running the facilities without regular employees. “These are not easy machines to run,” he said.  

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