Dive Brief:
- Many food and beverage companies, including PepsiCo, Mondelez International and Hormel Foods, are giving bonuses or other benefits to employees who manufacture and sell their products during the coronavirus outbreak.
- Pepsi said it would provide at least an incremental $100 per week for its more than 90,000 U.S. frontline employees during the next month. The soda and snacks maker also will provide enhanced benefits to all U.S.-based employees, including those who have to quarantine, in the coming months. Those who quarantine will receive 100% of their pay. PepsiCo also said it will hire 6,000 new frontline employees across the U.S.
- Hormel announced it would give more than $4 million as part of a cash bonus to its 13,000 plant production employees. The special bonus includes $300 for full-time workers and $150 for part-time team members. Mondelez International said its manufacturing, distribution and sales hourly workforce would get a $2 per hour pay increase through May 2 and sales representatives would get a $125 per week bonus.
Dive Insight:
There are many individuals working to not only help those who are sick but feed the tens of millions of Americans impacted by the coronavirus — many of whom are under orders to stay home to slow the spread of the virus. Even as many businesses, including restaurants, movie theaters and malls, have shut down, food and beverage production was deemed an essential operation, which allows workers to keep making products to stock grocery store shelves.
"With COVID-19 reshaping the way we run our business and live our lives, it's important that we acknowledge the people keeping us steady during turbulent times, notably the heroic work of the millions of doctors, nurses, and healthcare professionals around the world," Ramon Laguarta, PepsiCo's CEO, said in a statement. "At the same time, there is important work being done in other sectors, including our own, to help maintain the supply of foods and beverages."
It has become a challenging task for CPG companies. Many Americans have been stockpiling at home in case they can't get to the grocery store later or to reduce their chance of being exposed to the virus because they need to leave their homes.
Nielsen statistics emailed to Food Dive last Friday showed U.S. residents are stocking up on some of the products that likely include PepsiCo's signature soda and Frito-Lay chips or Hormel's Jennie-O turkey and Spam. Potato chips rose 29.6% for the week ended March 14 compared to a year ago, soft drinks sales increased 26.1%, canned meat was up 187.8% and fresh meat alternatives jumped 279.8%.
It seems like a smart decision for multi-billion dollar corporations to reward the hundreds of thousands of workers on the front line who are working hard to feed consumers, many of whom are safely ensconced at home. A few million dollars in bonuses and other benefits is a small price to pay to keep products — and the sales that come with them — flowing. Companies no doubt realize this, but they also are cognizant of the fact that providing these benefits generates goodwill with its workers, upon whom they will depend long after the pandemic has subsided. It also creates valuable PR that shows they're more than just faceless corporations out to profit from their employees and the situation.
Large CPGs have found other ways to do their part during the coronavirus outbreak. Alcohol companies such as Pernod Ricard, Diageo and Anheuser-Busch are producing and donating hand santizer to help alleviate shortages on store shelves. Other businesses have donated money to help with food security and emergency relief efforts in the U.S. and around the world.
But without employees, food and beverage companies wouldn't be able to manufacture their products. CPG companies are likely to find new and innovative ways to reward employees putting themselves at risk, especially the longer the coronavirus pandemic lasts.