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Frito-Lay drivers threaten labor strike over proposed pay offer

By
Josh Kosman
Published Dec. 22, 2016
Updated Dec. 23, 2016, 4:45 p.m. ET

PepsiCo Chief Executive Indra Nooyi’s drive to cut costs isn’t making her any friends among the Big Apple drivers for the company’s Frito-Lay operation.

The union drivers — already among the lowest-paid of the many routemen delivering snack foods to city stores, drivers for rival companies said — recently authorized a strike after learning a proposed new pay scale could leave many earning less, The Post has learned.

Nooyi wants to do away with the commission-based pay for the roughly 450 area drivers and implement a mostly salaried pay scale.

“It’s very complex,” Gerard Fasano, president of Teamsters Local 802, told The Post, noting that it was the first time in more than 20 years his drivers authorized a strike.

“I don’t think the change [to a salary] is the issue but how it is structured,” he said.

President-elect Donald Trump last week added Nooyi to his Strategic and Policy Forum, which is tasked with helping him create new jobs.

Meanwhile, Frito-Lay brass are pressuring drivers to accept the proposal.

“Drivers have been getting written up daily and called in for private meetings with managers to be encouraged to accept the new deal — or face consequences,” one driver, requesting anonymity, said in an interview.

Frito-Lay is threatening to hire replacement workers to keep the potato chips and salty snacks in the market, the driver said.

The average Big Apple Frito-Lay driver makes a guaranteed $400 a week, plus a commission. The commissions bring the average compensation of a driver with a good route to $65,000 to $70,000 a year, plus benefits.

The new plan would guarantee $50,000 a year and add a commission structure based on a target the company sets — and would change every four weeks.

“Guys are scared the sales plan will come from the top and you can work 60 or 70 hours a week and only get paid the guarantee,” one driver said.

PepsiCo has rolled out a similar plan in other parts of the country, and the results for drivers have been mixed, sources from both sides said.

Drivers for Wise Chips earn roughly $75,000 — comparable to what Frito-Lay drivers make — but also own and maintain their vehicles.

Meanwhile, Nooyi’s compensation keeps rising. PepsiCo increased her compensation by 18 percent in 2015, to $26 million.

PepsiCo over 25 years has succeeded in decertifying unions in some areas, reducing the portion of Frito-Lay drivers who are unionized to 6 percent — down from 17 percent — of the workforce, a union leader said.

PepsiCo declined comment.