The Kellogg Company and more than 1,300 members of the Bakery, Confectionery, Tobacco and Grain Millers (BCTGM) union at Kelloggs’ four ready-to-eat cereal (RTEC) plants announced the ratification of a new 5-year contract. The contract covers Kellogg plants in Battle Creek, MI; Memphis, TN; Omaha, NE; and Lancaster, PA. The current contract is scheduled to expire on Oct. 3.

The deal includes ad 5-year moratorium on any plant closing, solid wage and pension increases and maintenance of health care benefits.

Jethro Head, BCTGM international vice president called the negotiations a great team effort.

"The five-year moratorium on plant closings provides our members with a sense of security and hope for the future,” Head said.

Kellogg says the new contract, which will allow the company to further invest in innovation and brand growth.

"We are pleased we were able to work with the BCTGM to agree on a contract that helps ensure our U.S. plants will continue to be more competitive in our global manufacturing network," said Alistair Hirst, senior vice president of Kellogg Global Supply Chain. "For our employees and for Kellogg, we remain committed to the future of this business and focusing together on producing the high-quality, nutritious foods that give people a better start to their day."

Kellogg said the contract narrows the gap in labor costs at the company's RTEC locations across its manufacturing network and in the industry. It includes significant concessions on future healthcare costs and there will be no retiree health care for new hires. While the contract prohibits the company from closing any plant, the deal does provide Kellogg the flexibility to optimize production lines.

 "This fair and competitive contract recognizes the important work of Kellogg's employees and helps to ensure the long-term success of the company's RTEC plants and business," Hirst said.