BrewDog boss hits back over real living wage controversy

After it was revealed last week that BrewDog would no longer be paying bar workers the real living wage, co-founder James Watt has defended the decision, saying that the company has to “balance [its] books”.

 

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Despite the company being an active part of the Living Wage Foundation’s campaign to pay workers the ‘real’ living wage, it emerged last week that BrewDog would no longer be paying current or future employees at its UK bars in accordance with a wage rate that factors in the ever-increasing cost of living.

From 1 April this year, workers outside of London will see hourly pay increase from £10.90 to £11.44, while wages for those working in BrewDog’s London bars would remain at £11.95 per hour. According to the Living Wage Foundation, the real living wage at present is £13.15 per hour in London and £12 per hour for the rest of the UK.

The decision sparked backlash from union Unite Hospitality, Punks With Purpose (a group of former BrewDog employees), and large parts of the media – the former even launched a petition on Megaphone calling for Watt to stick to BrewDog’s commitment to paying the real living wage. At the time of writing, it has garnered more than 16,000 signatures, with a goal of reaching 20,000.

In a long post shared across his social media accounts, Watt stated that last week had been “incredibly tough”: “If you saw the media storm last week (and let’s be honest – it would have been hard not to) you would be forgiven for thinking that we pay our fantastic people in the most miserly of ways. Or worse, that we had cut our teams pay.”

He then proceeded to list various things that he claimed BrewDog was providing its bar employees, including “better” starting packages than “90% of [its] competitors”, wage increases “almost double the UK average” since 2022, and he also said that would be giving “20% of [his] own equity in BrewDog to [its] amazing people over a four-year period”.

“Business is incredibly hard, especially when the UK economy is in such poor health, and sometimes you have to make incredibly difficult decisions,” he continued.

“The controversy last week was because we have only increased our nationwide bar team wages 20.4% since March 2022 and not the 26% that would have been required to retain a Real Living Wage status. No nationwide companies in hospitality that have this status, to the best of our knowledge. I would love nothing more than to give everyone in our business a huge pay increase, but we simply have to balance our books, offer fair value to our customers and ensure the long-term viability of our business. And ultimately, protect jobs,” he said.

In June last year, BrewDog’s results for the financial year to 31 December 2022 revealed a £24 million operating loss, a dent partially attributed to the increase in energy costs of brewing.

WLC has reached out to Unite Hospitality for its response to Watt’s statement.

Watt’s leadership as the “captain” of BrewDog has been mired in controversy in recent years with allegations of bullying and harassment, which he has denied.

This article originally appeared on the drinks business.

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