BrewDog wage controversy and the perils of being 'punk'

In a LinkedIn post he wrote: “It has been so exciting to work with such talented people on the script of this amazing new movie: Underdogs: The Rise Of BrewDog.

“Since Martin (Dickie) & I started BrewDog, both just aged 24, the journey has been remarkable – high highs, low lows, failures, successes and a healthy dose of controversy along the way.”

Seven days later, the company decided to stop paying its staff the real living wage.

The move was just the latest in a long line of issues which have tarred the company’s image, with its punk pretentions having long since been the subject of mockery. Comedian Alistair Green went viral with a video promoting the fictitious ‘Punk Squirrel IPA’, an imagined craft beer promoted by middle class, middle-aged men who fail to skateboard and declare: “I can only see my kids every other weekend – COWABUNGA DUDE!”.

But how did one of Scotland’s biggest business success stories experience such issues? Why has BrewDog left a sour taste in many mouths?

Origins

Founded in 2007 by Mr Watt and Mr Dickie, along with a dog from which the brand gets its name, BrewDog started life in a shed on a Fraserburgh industrial estate. Thanks to what its founders describe as “some very scary bank loans”, the pair set out to revolutionise the beer industry both through creating heavily-hopped, more deeply flavoured beers than the lagers produced by mass breweries, and with some innovative marketing.

Early stunts included making the craft beer revolution literal by rolling through Camden with a tank, serving the world’s strongest beer from inside taxidermy squirrels and naming one product Speedball after the name commonly given for a cocktail of cocaine and heroin.

These and other campaigns led to repeated censure by industry watchdogs but that was all part of the plan – not for nothing did Mr Watt and Mr Dickie name their flagship product Punk IPA.

Read More: 'Outrageous': BrewDog criticised for dropping real living wage

Whether you found their tactics ingenious or insufferable – having a person with dwarfism stand outside parliament for a week as part of a campaign to allow two-third pint measures being another such stunt – they were effective. The first BrewDog bar opened in 2009 in Aberdeen and less than 10 years later the company was operating close to 80 worldwide, with its 2022 results showing revenues of £320m.

In the punk world though you’re never far from accusations of selling out, and by the middle of the 2010s a backlash was brewing.

Equity for punks

As part of a crowdfunding campaign in 2011, BrewDog launched “equity for punks”, offering shares in the company priced at £23.75 and coming with a range of benefits including discounts in BrewDog bars and its online store, first options on new ranges and the opportunity to discuss the direction of the company on a dedicated online forum.

Was it punk? A 2015 promo for the scheme entitled ‘Don’t Make Us Do This’ received backlash after Mr Watt and Mr Dickie depicted themselves in scenarios including begging on the street and dressing up in female clothing to act as sex workers. A petition to have the advert removed stated: “BrewDog beer company claims to be ‘beer for punks’. They claim to be ethical. Yet in their new crowdsourcing video they mock homeless people, trans women and sex workers. They say, ‘don’t make us do this’ – whilst performing as offensive caricatures of people, many of whom already suffer discrimination every day.” BrewDog said no offence was intended.

Was it equity? The shares issued by BrewDog contained no pre-emption rights, meaning they can be diluted at any time and the company is unquoted so they cannot be sold on an exchange. As for dividends, the brewers say: “At the moment we have no plans to pay dividends. As a high growth company our strategy is to reinvest all profits into the business to fuel further growth”. The company  is not regulated by the Financial Conduct Authority.

In 2017 private equity company TSG Consumer Partners bought 22% of BrewDog shares, after which ‘Equity Punks’ were permitted to sell up to 40 of their own shares, up to a maximum 15% of their total shareholding, or claim six cans of Vermont Style IPA.

Culture of fear

If selling to a private equity firm doesn’t seem very punk, neither do many of BrewDog’s other activities. A brother and sister team behind a Birmingham pub were forced to drop the name Lone Wolf after BrewDog threatened legal action, having launched a vodka of the same name. The previous year it had criticised “petty pen pushers attempting to make a fast buck by discrediting our good name under the guise of copyright infringement” when Elvis Presley’s estate took issue with its Elvis Juice beer. Mr Watt would later tweet: “Our lawyers got a bit trigger happy. We are happy for the Lone Wolf Bar in Birmingham to keep using the name.”

The company also threatened action against a bar in Leeds named Draft Punk, claiming it infringed on the copyright of its own Punk IPA. In response an open letter from the ‘global punk community’ warned: “Definitions of punk are varied and debates over those definitions have been going on since before you were born. However, one thing punk is not is a bully! That goes against everything punk stands for. If you continue in this vein your punk credentials will be revoked and you will be called upon to cease and desist.”.

Read More: BrewDog Qatar hypocrisy and when punk doesn't really mean punk

BrewDog said: “The other party tried to register ‘Draft Punk’ as a trademark, but we own the ‘Punk’ trademark for beer, so naturally we objected as that is one of our trademarks… We won’t apologise for protecting our flagship brands, our business and the livelihoods of our amazing employees”.

In 2019 the company was accused of stealing marketing ideas and designs after offering fake job interviews, something Mr Watt called “ridiculous”, while the co-founder was accused in a 2022 BBC documentary of behaving inappropriately around female staff. He denies this and threatened legal action.

The previous year an open letter published on behalf of more than 100 former staff accused the company and Mr Watt of fostering a “culture of fear” at BrewDog, in which workers suffered bullying and were “treated like objects”.

An open letter, to BrewDog. pic.twitter.com/xEd3B83qot

— Punks With Purpose (@PunksWPurpose) June 9, 2021

After being named one of the Sunday Times’ best places to work for 2023, Mr Watt posted an open letter to “BrewDog haters” describing the allegations as “a vicious campaign of lies” by a “small group of individuals who seem to have made it their life’s work to take down our company”.

Wages

In its ‘Craft Beer Revolution Manifesto’, BrewDog states its mission to become “the best company to work for. Ever.” and touts paying the Living Wage among the benefits for staff. Last week though it announced that new recruits will be paid minimum wage, while current staff will no longer be paid the ‘real living wage’ – a pay rate calculated against the cost of living.

Bryan Simpson, lead organiser of Unite Hospitality, said: "BrewDog have been paying the real living wage since 2015. To withdraw it now, during the most acute cost of living crisis in a generation, is outrageous.”

Mr Watt blamed “unprecedented challenges in the hospitality sector”, claimed the move “will help save hundreds of jobs” and again pointed to the Sunday Times list.

He wrote on social media: “We continue to invest way more in our people than our competitors. When you add up everything that we do for our people the value of the package is even more generous than Real Living Wage.”

It remains to be seen whether Underdogs: The Rise of BrewDog will feature the company’s various tribulations in recent years but one thing is surely undeniable. A big screen tale about corporate growth isn’t very punk now, is it?