Craft beer behemoth, Brewdog, has recently announced that it will no longer pay its employees the real living wage. Instead, workers will receive the UK government’s national minimum wage of £11.44 per hour from April. This rate falls below the £12 cost of living-based rate. The Aberdeenshire-based firm cited the move as “necessary” in an attempt to regain profitability after experiencing a £24m operating loss in the previous year. However, former staff members have criticised the company for “abandoning its principles” with this action.
In a letter to its employees, BBC Scotland News reports that Brewdog has had to make some “hard decisions” to maintain its financial stability, especially in light of a “bumper” festive period. The brewer had been paying the voluntary wage since 2015. Bryan Simpson, hospitality organiser of Unite, stated that “to withdraw the real living wage now, during the most acute cost of living crisis in a generation is outrageous.”
The real living wage is independently calculated, based on living standards in the UK and is separate from the government’s national living wage. Effective 1 April, the rate will increase to £12 per hour outside London and £13.15 per hour for workers in London in line with inflation. However, Brewdog staff members over the age of 23 will receive a slight pay rise from £10.90 to £11.44. London workers will see no increase from their current rate of £11.95.
The Punks with Purpose campaign group, set up amid mistreatment allegations in 2021, has expressed their disapproval of Brewdog’s decision. The group advocates for ex-workers and states: “The real-terms pay cut for hard-working front line staff proves there is no principle too dearly held for them to abandon.”
Brewdog’s decision comes despite its revenue growth to £321.2m in the 2022-23 financial year. The company attributes the operating loss to increased production costs for its most popular product, Punk IPA, and increased energy bills at its Ellon plant. Co-founder James Watt previously apologised to staff after a BBC Disclosure documentary in 2022 revealed claims of inappropriate behaviour. Brewdog’s spokesperson stated that the company remains committed to its staff and has a more generous benefits package than the industry average
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