KFC: Workers need to make concessions

WEDNESDAY, DEC. 21: KFC Bermuda says it is willing to negotiate with a new contract with its employees, but concessions need to be made if they are to remain in business.

Director Jason Benevides made that assertion today, a day after the Bermuda Industrial Union held a press conference and picketed the Queen Street fast food franchise.

In its last statement to the Bermuda Stock Exchange before delisting, KFC Bermuda posted a $20,000 loss for the first six months of this year. In 2010 the company showed $167,000 in net income.

Mr Benevides said KFC notified the BIU on February 1 that it intended to modify the terms of the existing collective agreement (CA) which was due to expire on April 15.

He said: “Negotiations began in good faith in April and continued through to August 2011 but unfortunately KFC was not able to reach agreement with the BIU on the requested changes to the CA.”

KFC issued the BIU a written notice on September 9 of its intention to terminate the CA.

Mr Benevides cited Article 38 of the Collective Agreement which states: “This Agreement shall come into effect on 15th April, 2008 and shall remain in effect for a period of not less than three years and thereafter shall continue in effect provided that at any time after 14th January, 2011, three months’ notice of termination or modification may be given by either party hereto.”

The effective date of termination was December 9.

Mr Benevides said back in September: “KFC also agreed to enter into mediation with the BIU with the assistance of the Department of Labour. After several mediation meetings, however, KFC and the BIU were still unable to reach agreement on a number of critically important points which KFC’s board of directors deemed to be essential for KFC to be economically sustainable.

“It has consistently been, and still is, KFC’s position that modification of the CA is necessary in order to allow the company to reform its cost structure to a sustainable level over the long term and remain a viable enterprise.

“These changes are essential for the continuation of the business and preservation of existing employment.

“KFC, like many businesses in Bermuda, has experienced a trend of declining sales and increased operating costs leading to net losses. The CA, which was in place through December 9 of this year, did not anticipate the changes in the economic environment that have occurred since 2008 and the economic realities that all business in Bermuda, especially those in the hospitality industry, are facing today.

“KFC remains committed to working with the BIU, or such other representatives as our employees specify, to establish a new Collective Agreement, and to ensure the continued well-being of our staff in these difficult economic times.

“Now is not the time for emotions to rule. Bermudian staff, Bermudian owned companies and Bermuda itself are suffering and we must all work together to find solutions to our shared challenges.”