Kellogg’s to close Omaha, Nebraska plant, destroying 550 jobs

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Kellogg’s employees stand outside the company’s breakfast cereal factory in Omaha, Nebraska, December 2, 2021. (AP Photo/Josh Funk)

On Tuesday, W.K. Kellogg Co. announced it would close its cereal plant in Omaha, Nebraska, by the end of 2026 and reduce production at its Memphis, Tenn., plant. The company said it would increase production and investment at its plants in Battle Creek, Mich.; Lancaster, Pennsylvania; and Belleville, Ontario. Even with that, 550 jobs would be permanently lost.

The majority of the workers affected are members of the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union (BCTGM). The union bureaucracy’s response to the announcement was simply pathetic, confirming that it will do nothing to fight the cuts.

BCTGM Local 50G President Kenneth Merritt said, “It’s a very, very early announcement, so it gives us a little bit of hope and opportunity to think that something might change.”

Last October, Kellogg Company split into two separate companies: breakfast cereal brand WK Kellogg Co. and snack brand Kellanova.

The company announced its second-quarter financial results earlier this week, showing revenue of $672 million, down 4 percent from the second quarter of 2023. However, net income rose to $31 million, up 15 percent from the second quarter of 2023, with a profit margin of 4.6 percent, also down from 3.9 percent in the second quarter of 2023.

In February, the company announced that its net sales for 2023 would be $2.763 billion, up 2.5% from a year earlier, and that full-year net income would rise to $110 million, up 540% from a year earlier.

The company is again on track to reach billion-dollar sales in 2024 and 2025.

Sold out strike 2021

These layoffs are only possible because of a sell-off by the BCTGM bureaucracy. In 2021, 1,400 Kellogg’s workers went on strike for nearly three months at four grain plants, including the Omaha plant, as well as plants in Battle Creek, Michigan, Lancaster, Pennsylvania, and Memphis, Tennessee. The company was ruthless, threatening to carry out mass layoffs in retaliation for the strike.

Striking Kellogg’s workers stand outside the company’s breakfast cereal plant in Omaha, Nebraska, Thursday, Dec. 2, 2021. (AP Photo/Josh Funk)

The final deal, passed under questionable circumstances, was pushed through by BCTGM officials who isolated striking workers, forced them to vote on nearly identical contracts to squeeze them, and used internet censorship to stifle discussion and criticism of the union and the deal.

Leaked management emails show the deal “simply shifts money from one bucket to another” with no increase over the previous offer, adding: “We are confident it will be accepted (as) the majority of the union’s negotiating committee is in favour and plans to recommend it.”

The workers’ main demand was to end the hated two-tiered pay structure, under which “transitional” workers earned significantly less than “traditional” workers. Instead, the new contract expanded it, removing limits on the number of “transitional” workers the company could hire at each plant. The contract also included a modest 3 percent pay increase, effectively a pay cut due to inflation.

In a revealing statement, former union president Dan Osborn said he did not view the plant closure as the company’s retaliation for the strike, insisting, “That contract that we had at the end of the strike was not very lucrative because we didn’t get the huge bonuses that we did at John Deere,” he said. “We basically kept what we had.”

In opposition, the WSWS called on workers to take control of the strike from the bureaucrats and appealed for the broadest possible working-class support for the extension of the strike. In particular, the WSWS stressed the need to establish lines of communication between Kellogg’s workers in other countries and cited the role of Warwick Dove, one of 150 dismissed Australian Kellogg’s workers, in the 1995 US strike.

In response to the ad, the employee commented on Facebook: “This is why you don’t dedicate your life and family time to the company! They don’t care about anything but the bottom dollar.”

Another commented: “Let’s not forget that this also impacts many other businesses that store their products (many warehouses locally) as well as the shipping companies that get that product out of Omaha!”

Establish committees of rank-and-file workers that will defend jobs!

The expected plant closures and layoffs are part of an ongoing bloodbath of jobs. In all, more than 124,000 jobs have been eliminated by 384 companies in the United States. The unemployment rate continues to rise, as does the threat of a recession that would put even more jobs and businesses on the line.

But the fight is not over. Jobs and livelihoods can and must be defended, but it will require workers taking control and forming rank-and-file committees at plants in Battle Creek, Michigan; Lancaster, Pennsylvania; Memphis, Tennessee; and Omaha, Nebraska to fight to defend jobs and against plant closures.

The committees should reach out to other groups of workers in the union and in different industries. Demonstrations and actions should be planned and organized. Workers should link up with the IWA-RFC (International Alliance of Workers’ Rank and File Committees) and build lines of communication throughout the country and internationally. There is no time to waste! It is possible to defend jobs and improve living conditions, but it requires breaking with the union bureaucracy and democratically asserting workers.