Mott's Workers Ask Dr. Pepper Snapple Why $550 Million in Profits Isn't Enough (5/20/10)

  Mott's worker Ira "Bud" Bristol asks Dr. Pepper Snapple CEO Larry Young (seated at right) why the company is trying to decimate wages and benefits at Mott's despite huge profits.

With just three days until Dr. Pepper Snapple (NYSE: DPS) intends to implement new contract terms that would impose wage and benefit cuts on more than 300 full time manufacturing workers at the Mott’s plant in upstate New York, several Mott’s workers/shareholders addressed the DPS Board of Directors at their annual meeting in Frisco, Texas.  In addition to questioning the need for cuts in the face of the company’s record profit and growth, the workers issued a warning about the effects of a prolonged labor fight on Mott’s reputation and the larger Dr. Pepper Snapple image.

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“Forcing these cuts on us when DPS made $555 million in profit last year is unacceptable,” said Timothy Budd, who has worked at the plant for 24 years.  “Why do you want to cut the wages and benefits of the very people whose hard work and dedication contribute to the company’s success and help make Mott’s such a successful brand?”

RWDSU Local 220, which represents the workers, has been trying to secure a fair contract for months.  Despite the company’s profitability, DPS is demanding a $1.50 per hour wage cut for all workers, a pension freeze for current employees and a pension elimination for future employees, decreased employer contributions to the 401K and increased employee contributions toward health care premiums and co-pays.  Plant workers overwhelmingly rejected this offer and voted in favor of authorizing their negotiating committee to call an unfair labor practice strike. The union has continued to demand that the company bargain in good faith in order to quickly reach a fair contract.

The Williamson plant is the only plant that produces Mott’s applesauce, including high margin single serve packs, with 70 percent of the workforce in skilled labor categories.  A labor dispute could damage the value of Mott’s family-friendly brand by associating it with corporate greed and union busting.  Additionally, the product may suffer quality issues, as the skilled workforce is not easily replaceable.  The Mott’s brand is responsible for more than $500 million worth of DPS’s retail sales each year.

“Why would DPS, with millions in profit, risk interrupting production at a high volume plant?” asked Ira Bristol, who has worked at the plant for almost five years.  “Destroying goodwill and creating this antagonistic atmosphere will badly hurt the production system and bottom line, not to mention negatively affect employee morale and tarnish the Mott’s and DPS brands around the country.”

In the event of a labor dispute, the RWDSU plans to communicate with the 1.3 million UFCW members throughout North America as well as with other unions and allies, in addition to setting up informational pickets at locations throughout the U.S. and Canada to educate consumers about Mott’s/DPS labor practices.  The effects of such efforts, combined with production issues, could disrupt the sales of Mott’s products and negatively impact the company’s current run of growth and profit.

“It is shocking that a profitable company would gamble away their relationship with their workforce and their reputation in the Rochester, New York, area as a reputable employer all in the name of corporate greed,” said Stuart Appelbaum, RWDSU president.  “Driving down wage and benefit standards, while exponentially increasing CEO compensation is bad management and bad business.  Dr Pepper Snapple CEO Larry Young and DPS should be ashamed.”