THE GIST
On Monday, about 140 employees of Minneapolis-based Surly Brewing Co.’s Beer Hall informed the company of their intent to unionize by joining Unite Here Local 17, a Twin Cities hospitality union. The servers, bartenders, hosts, cooks, and others employed by Surly’s expansive, $30 million Beer Hall call themselves Unite Surly Workers. They marched outside the building and asked ownership to voluntarily recognize their union.
According to Unite Surly Workers committee member Aubrey Lee, ownership did not. Lee says Surly owner Omar Ansari told the group in person: “No, I don’t really know about this thing.” Brewing staff is not a part of this organization effort.
Early Wednesday morning, Beer Hall employees were notified by email that their jobs will be terminated Nov. 2. Around noon Wednesday, Surly Brewing then announced on its website that the company would indefinitely close its Beer Hall, also on Nov. 2. The announcement states that “gathering places and pandemics don’t mix.” It continues: “… try as we might to find a way to keep the doors open and our team employed, the writing was on the wall: there was no longer a way forward for the Beer Hall.” A brewery spokesperson declined to provide comments to GBH beyond what was written in that statement.
WHY IT MATTERS
The news has spurred competing narratives, but all center on COVID-19. Employees say their unionization efforts are rooted in a need for healthcare and better pay, made especially urgent during a pandemic. Surly says the Beer Hall’s closure is entirely due to monetary losses, not workplace demands.
The tension between the two narratives shows that despite businesses reopening, the pandemic’s dramatic effects on the hospitality industry are far from over. As fall and winter weather eliminates outdoor drinking and dining options, even more businesses are likely to struggle.
Surly says Beer Hall revenue decreased 82% during the pandemic, compared with the same period last year. The company estimates that keeping the space open through the winter would cost $750,000, adding that closing the Beer Hall is necessary to stabilize the business and “ensure the continued operations of our core business, brewing.”
Meanwhile, the company's dollar sales, as tracked by market research company IRI, have been strong. In the most recent 12-week period tracked across grocery, convenience, and liquor stores, Surly sales are up 47% compared to last year—a $600,000 increase. As with so many other breweries, package sales have surged because of drinkers’ reliance on off-premise purchases. By the end of August, Surly had roughly matched all of 2019's IRI-tracked sales of $5 million.
These numbers indicate that off-premise, packaged sales are indeed critical to the brewery’s survival. As the 34th-largest craft brewery in the country by sales, per Brewers Association data, Surly produced close to 100,000 barrels of beer in 2019, the vast majority of which was sold at retail in the Midwest. Last year, Ansari told the Star Tribune that more than 80% of Surly’s sales come from Minnesota, Wisconsin and Illinois.
The pandemic is also directly responsible for workers’ efforts to organize. Beer Hall employees say they’ve raised concerns about health insurance coverage, compensation, and workplace misogyny to Surly management in years past, but Lee says the pandemic accelerated unionization plans. She especially highlights the need to have healthcare during a pandemic. “I want to see us respected by management,” Lee says.
Lee says that changes to Surly Beer Hall’s service model during the pandemic—including the elimination of tipping in favor of a blanket 15% service charge added to checks—led to some workers seeing 40-50% reductions in their pay. Before the pandemic, she says, she was making $12.25 per hour plus tips as a host; now hosts earn $17 per hour but can’t accept tips. She says she would have earned more under the former system. Surly did offer front-of-house workers a raise to compensate for the loss of tips, but Lee says the raises were applied unevenly, resulting in some employees making significantly less than they had before the pandemic.
Lee says management told front-of-house staff in June that eliminating tipping was designed to create more equitable pay between front- and back-of-house workers, but that kitchen staff didn’t receive raises until “months later,” when they asked about them. Initially, according to Lee, kitchen workers weren't even aware of the new service charge and raises. She says once the raises were instated, no kitchen staff received more than a $1 per hour increase; kitchen staff makes between $15-$18 per hour, according to Lee.
Discussions around employee health insurance also became particularly important during the pandemic. Lee, who has insurance through the company, says Surly made false promises to extend insurance coverage to certain employees following the Beer Hall’s reopening after its initial, temporary COVID-related closure in March. When employees returned in early June, she says many were told they’d have to wait until November and undergo a quarterly review of their schedules to make sure they’d worked the 30 hours per week necessary to qualify for employer-sponsored insurance. She says the criteria for qualifying for coverage were “murky” to some stuff, and that it’s unclear why some employees qualified while others didn’t.
According to Lee, management also didn’t adequately address staff’s concerns about safety in the Beer Hall during the pandemic. She says employees were initially discouraged from enforcing state laws requiring mask-wearing among patrons, and that management continues to disregard staff objections to patrons pushing tables together and congregating in groups as large as 20-30 people.
“When we first reopened, management was saying, ‘Please come talk to us,’ but all of what we presented fell on deaf ears,” Lee says. “There have been people fired for speaking up or ‘having an attitude’ about the changes made.”
Surly’s workers aren’t alone in experiencing job-related anxiety during the pandemic. Lee says employees of five small breweries in other states have contacted her since hearing about Surly Workers Unite, asking how they can begin unionizing.
Across the country, hospitality staff have been on the front lines of the pandemic, and are at elevated risk of catching and spreading COVID-19 due to their daily interactions with the public. Those without health insurance are making especially fraught decisions every day about balancing their personal health, the safety of their customers, and their need to earn a living.
In a statement posted to its Instagram on Tuesday, Surly Workers Unite writes: “Surly Brewing Company is not immune to the inequalities and injustices that afflict the service industry, many of which the COVID-19 pandemic has exacerbated.”
While acknowledging that the timing of the announcement of the Beer Hall closure is “not ideal,” Surly says in its statement that the closure had nothing to do with unionization efforts or employee concerns: “On Monday, some hospitality employees notified us of their intent to unionize. We respect their decision to turn to an outside organization for representation and will continue the dialogue. That does not change the fact that our plans to close the Beer Hall were put in place weeks ago with the announcement planned for this week.” But employees have accused the brewery of making new hires just this week without any hint of a pending closure.
Lee sees it differently. She says the layoffs and Beer Hall closure are “retaliatory action” in response to employees’ efforts to protect themselves.
“[Management had] been talking about what to do during the winter, which a lot of restaurants are, but this is retaliatory action. Deciding to permanently lay all of us off; we’re all just shaking,” she says.
Lee says she’s hoping the workers’ Unite Here representative will help Surly employees navigate their next steps. It’s currently unclear whether the Unite Here union has any legal avenue to fight the layoffs or planned Beer Hall closure.
Words by Kate Bernot