Praveen Parmasivam

(Reuters] -Kellogg Co announced Tuesday that a majority U.S. workers in the cereal industry voted no to a five year contract. It was forced to employ permanent replacements after employees extended a two-month-old strike.

It has already employed temporary substitutes at its cereal plants of Michigan, Nebraska Nebraska, Pennsylvania, Tennessee. On Oct. 5, 1,400 union members struck after their contracts expired. Talks over payments and benefits were stalled.

Kellogg (NYSE 🙂 stated in a statement that while it was not what we had hoped for “we must still take steps to maintain business continuity.”

According to the company, “unrealistic expectations”, created by the union, meant that none of the six offered, which included the one proposing wage increases for all employees who have served at least four years, was made.

The union members claim that the two-tiered system in which transitional workers get less pay and benefits than those who are more tenured, would remove power from the union.

Jeffrey Jens, an union member said that they have created a clear path – however, it’s too complicated and unfair to all.

Numerous politicians, including Elizabeth Warren (Democratic senator) and Bernie Sanders (Democratic senator), have spoken out in support of the union. Many customers however have declared that they boycott Kellogg’s products.

Kellogg is among the many large U.S. businesses that has been hit by worker strikes over the past few years, as the labor markets tightens. Although the company warned that there would be a loss of profit due to the strike, it was not yet able to quantify this.

Last month, farm equipment maker Deere (NYSE:) & Co reached an agreement with striking workers.