BrewDog Progress Update – July 21

The following is a point by point breakdown of BrewDog’s progress update, published on July 13th 2021 by James Watt on the private BrewDog shareholder forum, and on his personal LinkedIn profile, which we have chosen not to link to. The text is replicated here, in full.

Independent Review

We have appointed Wiser to conduct a full, unbiased review of culture within BrewDog. Wiser are one of the leading culture consultancies globally. They have a wealth of experience working on employee research projects for Nike, ASOS, the BBC, Pret, and many more, where their experienced team immerse themselves in a company to listen and learn about the things that matter. To give you an indication of the timelines involved, we intend to share the high-level findings internally and externally before the end of the year. As part of this culture review, we will reach out to former employees as well as our current team to get the fullest picture we can.

Feedback:

This is good progress, and it appears Wiser are equipped to handle the culture review. We understand that Wiser have now been in touch with BrewDog’s current team, and we look forward to them reaching out to former staff – we suggest this should not to be limited to those who left in the last twelve months, as the last year and a half is not representative of how things were at BrewDog before the pandemic. 

We also ask that Wiser extend this culture review to all BrewDog’s subsidiary companies, including BrewDog USA, Australia, and Germany, BrewDog Bars, BrewDog Pubs, BrewDog Distilling Co, BrewDog Hotels, Overworks, and Hawkes – as far as we are concerned, anyone that ultimately is employed by James Watt must be contacted to be allowed to voice their experiences, in a genuinely anonymous manner.

Ultimately, Wiser can only give BrewDog feedback on what they see and hear, and the input will only be valuable if it results in a serious change in ethos at a senior management level. It is absolutely crucial that BrewDog’s senior leadership team not only listen and learn, but are held accountable for their actions going forward.

Anonymous Staff Survey

We sent the anonymous staff survey to our teams on 29th June. This survey is one of the key steps on our way to making BrewDog a place to work that we can be truly proud of, and our team’s input will shape BrewDog going forward. The survey is being conducted by Opinyin, and the findings will be fed into the Independent Review process and communicated as part of it.

Feedback:

While we are pleased BrewDog acted quickly on their staff survey, we have now seen the format of the questions, and feel it may be fundamentally flawed. Here is a genuine example question from the survey:

Thinking about your job, how much do you agree with the following statement about BrewDog?

“I do not find my job rewarding. I am not given the freedom to do it well. I am unhappy with the benefits I receive and I do not believe I have the opportunity to develop professionally.”

(Not at all)  1  2  3  4  5  (Definitely)

Multiple statements, on unconnected matters, were bundled into the same question. Staff might feel happy with the benefits they receive, yet remain deeply concerned at the lack of opportunity to develop – how were they supposed to communicate this? We admit we are not experts, but we believe this type of question is either very poorly thought out; or worse, designed to deliver a false middle-ground result, implying staff have no strong feelings on any of the individual statements.

We have also seen BrewDog’s implementation of anonymous employee surveys in the past, and it does not fill us with confidence. Their attempts to climb the rankings of the Sunday Times 100 Best Companies to Work For is a good example.

New benefits were announced in the run up, to sway the results towards positive feedback. During the process, teams were harassed by management to complete the survey, with departments played off against each other to hit the required submission quota. Based on team structure, some employees were identifable, rendering the “anonymity” claims false. And as soon as the results came in and it was revealed that BrewDog hadn’t climbed the rankings, James realised he couldn’t boast about it, and completely lost interest in the feedback.

We would like to know if Wiser will be fully appraised of exactly what the survey asked current staff, whether they will be permitted to perform their own survey if the previous one is found to be inadequate, and how their findings will be used.

Structure Review

We completed the Structural Review quickly. It was immediately apparent that we are under-resourced in certain areas. Volumes have grown significantly, and due to the economic impact of Covid-19 on our business over the last 18 months we have not been able to add to our internal resources in-line with that volume growth. We recognise the need to change this, and so we are currently working to add approximately 100 new people across the business to make sure we are fully resourced in all areas. The recruitment process is already well underway, and we are confident this will make a material difference very quickly to those colleagues who have been under pressure.

Feedback:

It is reassuring to see BrewDog filling positions required to sustain their growth. Their previous strategy has been to prune staff wherever and whenever possible, to reduce the wage bill – something James feels personally very strongly about, and is possibly the reason that BrewDog were able to identify which areas were already understaffed so quickly.

Despite his outward claims that BrewDog do not care about cutting costs, James has given many impassioned presentations to staff over the years, demanding that every single person treats every penny as if it were their own, to protect BrewDog’s razor-thin margins.

We will watch the development of staffing numbers closely, as we believe this is one area that will be reneged upon as soon as BrewDog perceive the attention on culture has died down.

Employee Representative Group

We have committed to creating an Employee Representative Group to ensure that our crew have a clear voice and connection to the decisions we take as a business. All representatives will be elected, so every crew member will play a crucial part in this initiative.

Feedback:

An ERG has the potential to help bring staff voices to senior management, so for this we commend BrewDog, but we are concerned that there is no guarantee that the ERG will have any power to influence policy.

BrewDog have implemented representative groups in the past, but can simply ignore their input. An EFP steering group has been around for some time, but has no official power. More recently, BrewDog established their Diversity and Equality forum; like the proposed ERG, it was intended to allow staff to communicate with senior managers – in this case on matters related to protected characteristics. We understand that thus far, this new forum has been a failure.

Asked whether BrewDog should brew a Pride beer, the Diversity and Equality forum gave a resounding “no” – yet BrewDog produced one anyway. It’s set to launch this month.

Until we see significantly more specific detail on how the ERG will function, and what measures will be in place to ensure management are answerable to this group, we will continue to recommend that staff consider joining a trade union. We know unions are not perfect, but over 300 BrewDog staff are already members of Unite Hospitality – we believe this group will have more success in holding senior management in check, and act as a safety net to protect individuals. Alongside this, we will continue to attempt to push for a significant top-down culture shift.

Exit Interviews

A key component of the Independent Review will be the exit interviews with all team members who have left BrewDog over the last 12 months. We have reached out to them already to ask them to participate. The input of our recent leavers is key to ensuring we get the fullest picture possible. We are absolutely determined to ensure that in future, the experiences of every crew member who leaves the business are considered to help us continually improve.

Feedback:

We know that the majority of relevant people received comms regarding their exit interviews (after we intervened when BrewDog missed their own unrealistic deadline) and for this, we thank BrewDog. However, there are other relevant people (having left within the twelve months prior to the open letter) who have not been contacted, and we know that in many cases, those people have signed contracts that prevent them from speaking negatively about BrewDog in public. We ask that every effort is made to contact those people.

We also ask that BrewDog consider extending the 12 months to 24, given that the last year and a half is not representative of normal BrewDog operations.

International Team Benefits

A full review of our international team benefits is underway, and we’ve appointed Mercer Marsh Benefits, an expert partner in this field, to help us navigate the complexity and legal issues involved – we want every BrewDog crew member to enjoy the brilliant benefits we offer, no matter which country they work in.

Feedback:

This is good news. We have already heard promising stories from international team members, and we hope that this continues – but we have also heard accounts of serious issues facing international staff, and thus we expect all of the other plans to apply to them too – including the culture review, the survey, the ERG, and more.

We would also like to highlight that regardless of what BrewDog stated in their early responses, we know of many instances where staff missed out on sabbaticals or puppy leave, because their line managers simply refused to approve  them. We want every BrewDog crew member to enjoy the brilliant benefits they offer, no matter who their line manager is.

Ethics Hotline

We have appointed NAVEX Global to manage a new Ethics Hotline and this has now been launched internally. This line will enable any employee in any country to report in absolute confidence any allegation of misconduct. It will help ensure that any issues are dealt with in a systematic, transparent way.

Feedback:

This is possibly the most significant development mentioned, and must be taken deadly seriously by BrewDog. Failure to act on allegations is one of the most serious failures of the business to date.

This function must apply to the entire business, and there must be protocols for dealing with allegations against those at any level of seniority. Every single person, at every level of BrewDog, in any country or any subsidiary business, must be accountable to someone, and not be above facing repercussions for their actions.

We insist that BrewDog confirm that this will be the case.

Career Development & Training

Our strategy for career development and training has been revised, and we’re currently in the process of appointing some key roles to deliver this so that you are able to access first-class career development within BrewDog. These include a Beer Trainer role which is now in place, along with a Training Manager for Retail and a Group Learning & Development Manager.

Feedback:

This is good news, and will benefit staff, as long as appropriate salary adjustments are made alongside any role progression – something BrewDog have failed to deliver in the past, instead basing salaries on previous roles, rather than the industry rate. 

We also ask that BrewDog stop suggesting staff pass Cicerone exams as their default route to a pay increase (employee value should not be determined by beer knowledge unless appropriate to their role), and that BrewDog stop enforcing mandatory entry-level Cicerone training and examination upon staff who do not feel comfortable doing so. It is more important to consider the mental health and work-life balance of your employees than it is for 100% of your team to have a beer qualification, when some of their roles will never require it, or they may need to be tested in a second language.

Salary Review

A full salary review has been undertaken, and every colleague who joined us before 1st January 2021 has recieved (sic) a 3% increase in salary, with all of these being applied no later than 1st July 2021.

Feedback:

We are pleased that BrewDog have applied this salary increase. The Living Wage Foundation applied an increase of 2.15% to the UK Living Wage from May 2021 (and a 0.9% increase to the London Living Wage), which BrewDog would have had to adhere to regardless, to retain their Living Wage employer status – but we do commend them for going above this.

From experience we know that BrewDog have historically underpaid in certain areas of the business, so we suggest that any staff who have been pushing for an appropriate salary increase (beyond the recent 3% one) continue to do so.

Onwards

We want to be an employer for which our amazing team are truly proud to work, and we believe the actions we have taken – as well as those we are still working on – will help us meet that objective.

Our priorities now are to listen, to learn, and to take the actions required to address the issues that have been raised. We are far from the finished article and are still learning as we go. We will continue to keep you updated as we deliver on the actions we set out in June.

And finally, I would like to thank all of our amazing team for all their hard work, we are extremely lucky to have them helping us build this business.

Hold Fast

James

 

Overall Feedback:

We understand that BrewDog have started to deliver on some of the actions they first laid out on June 17th. We have heard some positive feedback from current staff, we are pleased that progress is being made, and we acknowledge those efforts.

However, we have also seen praise for how humble, and willing to learn from their mistakes BrewDog (and James) are. Save your support until significant changes have been made. BrewDog have shown time and time again that the current senior leadership team are likely incapable of learning and growing. Just look at all their old apologies, and the inevitable follow-ups, as if nothing happened – Don’t Make Us Do This, No Label, Pink IPA, Beer Porn… this is who they are, and likely always will be.

James and Martin have now both publicly said sorry to their former employees – but as we have previously stated, we want to see apologies from anyone at BrewDog who treated their colleagues badly. In particular, those who did so and remain in positions of power to this day. We would rather see you step up and apologise before we reach the point where we have to address you directly.

Finally, our biggest fear is that so far, not a single point in BrewDog’s plan addresses the fundamental issues that underpin the culture we have helped to expose. Without a commitment to changing the mindset that drives the business, there can be no meaningful and significant long-term improvements at BrewDog. We will continue to push for this, and to hold BrewDog accountable for their claims.