Following a 1998 union organizing vote by 19 maintenance employees at our St. Albans plant, the International Brotherhood of Electrical Workers became the authorized collective bargaining unit for this group. In 1999, the Company and the union negotiated a contract which took effect on November 10, 1999. The Company’s goal in negotiating the union contract was to maintain equality of working conditions and benefits throughout the company; the negotiated contract is essentially modeled after the Ben & Jerry’s employee handbook.

At the end of 1999 there were 16 employees in the union. One member resigned from the Company and that position was not filled. Two of the original members were voted out during 1999.

In 1998 our Board of Directors approved a Livable Wage Policy. A livable wage is defined as a starting wage for a single person that will sustain a quality of life that includes expenditures for housing, utilities, out-of-pocket health care, transportation, nutrition, recreation, savings, taxes and miscellaneous expenses. Based on an analysis of such costs in Vermont, we determined this to be $9.40 per hour or $19,552 annually for 1999/2000.

On each non-exempt employee’s anniversary of hire his/her standard earnings were compared to the livable wage rate ($9.40 per hour) for all regular hours worked over the year. In cases where the livable wage rate was greater than actual earnings, a check was issued for the difference. (Profit sharing was excluded from this calculation and was paid over and above this amount.) In 1999, this policy resulted in compensation adjustments for 12 employees.

In 1999 58% of open positions (outside the Office of the CEO) were filled internally, compared to 54% in 1998 (51 lateral moves and 32 promotions).

Below is a chart detailing the benefits available to full-time employees as of the end of 1999. The average benefits expenditure per employee was $10,050 compared to $9,479 in 1998. Effective January 1, 1999, we approved an additional 1% match to our 401(k) Plan. This additional match brings the Company’s total 401(k) contribution to a maximum of 4% of salary.

In January of 1999, a pool of 200,000 stock options was granted for all full-time employees as of December 31, 1998, other than the Office of the CEO (senior staff) at a price of $23.63, resulting in an award of 316 options per employee.

In July of 1999, a pool of 200,000 stock options was granted at a price of $21.00. These options were awarded primarily on position and performance.

Our profit sharing formula continues to be based on both length of service and size of the 5% profit sharing pool. This formula assures that profit sharing is not distributed disproportionately to the highest paid employees. (Members of the OCEO are excluded.) For 1999, total profit sharing was $820,369. Each employee received $532 for the half of the pool allocated on the basis of headcount and $7.89 per month of service for the half based on tenure.

Our 1998 audit raised the question of whether a gap was emerging between wages paid to men and women in senior manager ranks directly below the Office of the CEO. In 1999 among senior managers where differences were greatest, average salaries for women rose modestly while average salaries for men declined modestly. The average salary for women in this category at the end of 1999 was just under $80,000; for men just over $80,000. Women earned less than men in manufacturing and administrative positions and more than men in professional and middle management positions. We believe that these differences are insignificant and reflect normal variations in length of employment and other factors.

Our gender balance in 1999 was 57% male and 43% female, the same as in 1998.

In 1999 approximately 3% of our work force were people of color, slightly more than the 1.8% in the state of Vermont. Among the eight senior managers that comprise the Office of the CEO, one was African American and two were women.

In 1999 we employed 133 temporary workers, 128 of whom were part-time or seasonal workers in our tour and company scoop shops. There were only five temporary workers in manufacturing and they received medical benefits.

In 1999 we offered three distinctive training programs to provide staff development opportunities: The Business & Values School, The Leadership & Management School and The Technical School. Through Ben & Jerry’s University we delivered over 7,300 hours of internal and external classroom training and involved over 350 employees from all departments and sites.

The Business & Values School offered courses in personal development and in targeted business skills. The major program in 1999 was a three-day Diversity & Inclusion workshop. Fifty-three employees at all levels and from all sites participated in this course, which will again be offered in 2000. The Personal Effectiveness Program started last year was completed in 1999. Other programs offered were: Business Writing, Effective Communications, Collaborative Planning & Decision Making, as well as customized programs for departments to improve team effectiveness.

The Leadership & Management School offered courses and development programs for company leaders. In 1999 the main focus was the Ben & Jerry’s Performance Development Series, a set of six workshops that provide leaders with the tools to develop staff performance. The first two workshops were delivered to 138 managers, supervisors and coordinators. The remaining four workshops will be delivered in 2000. The Technical School offered courses in job-specific skills. A key emphasis of the Technical School is supporting our Manufacturing and Distribution operations. In 1999 over 150 employees completed on-the-job training modules. In 1999 the Technical School delivered a three-day Introduction to Ammonia Refrigeration Systems course for maintenance and engineering staff. It also offered Ice Cream Fundamentals, HazMat Response Team Training and a two-day Sanitary Design course for Ben & Jerry’s sanitation, quality and engineering staff.

During 1999, the Company announced its decision to seek contracted novelty production under a co-packing agreement and to stop making novelties at the Springfield plant. We concluded that we could not be competitive in this category under existing conditions. Competition is especially intense in the novelty area. There is a faddish nature to the business-what’s in one season is out the next, and larger manufacturers, usually co-packers are more adaptable to a rapidly changing product mix. We believe that shifting our production mix will not result in a significant loss of jobs in Springfield. We have made a commitment to provide other opportunities and/or job training and placement assistance for any Springfield employees who may be adversely affected by this business decision. At the end of 1999, no change had yet been implemented and no jobs had been affected.

Since 1990 we have administered a biennial Work Life Survey, with the most recent one done in 1998.

There were no workplace-related regulatory actions against the Company in 1999.