Whiskey Rebellion: Jim Beam Workers Go On Strike After Failed Negotiations

Workers at two Jim Beam distilleries in Kentucky went on strike after contract negotiations failed late on Friday. Just hours before an existing contract was set to expire, over 200 union members overwhelmingly rejected the latest terms from the world's largest bourbon producer and walked off the job.

"We hope this is settled shortly," said Bill Ball, a 47-year veteran at Jim Beam. "If it's not, we're here for the long haul."

Strike at Jim Beam starts.
Workers at two Jim Beam distilleries walk off the job. [Image by Luke Sharrett/Getty Images]

According to the union, the workers in the Clermont and Boston distilleries opposed the new terms by a significant margin. Union representatives did not disclose what exactly encouraged the huge disapproval of the newly proposed contract and initiated the Jim Beam strike.

Staffing shortages forced many workers to take on 60- to 80-hour workweeks due to the high demand for Beam whiskey. To keep up, the company often brought in temporary workers, often overlooking opportunities for more experienced or knowledgeable employees for new roles or shifts.

"Some key issues include the following: job security in regards to the high number and excessive use of agency workers, failure to honor and recognize seniority, vague and open-ended contract language, poor labor scheduling resulting in burdensome and strenuous work hours that have led to an undesirable work/home balance," said union representative Janelle Mudd after a vote on Tuesday approved a strike should negotiations fail.

Roughly 95 percent of the world's bourbon comes from Kentucky. As demand for premium spirits and cocktails continues to increase, both bourbon and whiskey producers have experienced an unprecedented boost in sales over the past several years.

In 2015, bourbon production surged to a 50-year high as Kentucky distilleries like Jim Beam filled nearly 2 million bourbon barrels. That is a 44 percent increase above 2014 production, according to the Kentucky Distillers' Association. The state's bourbon industry employs approximately 15,400 people and pays nearly $707 million in annual wages.

Jim Beam strike started on Sturday.
Jim Beam strike leaves the production of popular bourbon in question. [Image by Luke Sharrett/Getty Images]

While it is unclear how the Jim Beam strike will affect production, the distiller plans to keep operations flowing as smoothly as possible.

"Given our inventories and contingency plans, we currently do not anticipate shortages of Jim Beam or any other products made at these facilities," said David Hunter, chief supply chain officer for Beam Suntory.

However, some workers like Ball think Jim Beam's backup plans will only lead to an inferior product.

"If Jim Beam wants to put the product out with the quality that we've done in my 47 years, it has to have our help to do it, so it's done right," Ball said.

Strikes in the whiskey industry are quite rare, and trade experts don't expect this one to have much consequence on the business overall.

"Historically, these strikes do not have a ripple effect," Fred Minnick, a bourbon historian, said on Saturday. "They tend to be more isolated events."

However, Minnick did concede that workers in the industry are generally highly skilled and specialized for the job and cannot simply be replaced should the Jim Beam strike go on too long. Severe injuries can easily occur if a worker is not properly trained and experienced, he said.

Jim Beam will continue to work with the union to bring the strike to an end. Since Friday's vote, the company has made some additional revisions to its offer, including pay raises and other concessions concerning overtime and temporary workers. Friday's vote marks the second time union workers have rejected Jim Beam's new contract terms.

"We hope that these team members will reconsider the attractive terms offered and ultimately support the proposal," noted Hunter.

The Jim Beam brand is owned by Japanese beverage company Suntory Holdings Ltd. It is uncertain just how long the Jim Beam strike will last or if it will ultimately effect whiskey supply worldwide.

[Featured Image by Scott Olson/Getty Images]