BrewDog to give shares worth around £120,000 to 750 staff in new profit sharing scheme

James Watt, founder and chief executive announced that he will hand over nearly a fifth of his stake in the craft beer company to mark the group’s 15-year anniversary.

The near-£100 million share award will be worth around £30,000 a year over four years to each eligible employee including those working in wholesale, manufacturing as well as bar and kitchen managers.

This is based on the most recent fundraising which valued BrewDog at around £1.8 billion.

Two pints in a BrewDog bar Credit: PA

BrewDog to launch first profiting sharing scheme in first for Scottish hospitality

The new scheme will involve its salaried staff – such as wholesale and manufacturing staff, bar and kitchen managers as well as so-called equity punk crowdfunding investors own 25%, and the majority of the firm, between them.

Under the move, Mr Watt's stake will reduce from 24.2% to 19.2% after awarding the shares which will initially be held in an employee benefit trust.

In a first for the hospitality sector, the Scottish brewer, based in Ellon, Aberdeenshire, is also launching a profit-sharing scheme.

The scheme will allow its 1,500 hourly-paid bar staff to share half of the earnings from each bar, unveiled as part of a wider growth plan laid out by the group.

Based on last year's numbers, BrewDog will pay out an extra £3,000 to £5,000 to each bar worker’s salary.

Bar staff will receive the payouts twice a year as cash under the intitative which starts in June.

The news comes after the group was accused by former workers last summer of having a “culture of fear” within the business, with “toxic attitudes” towards junior staff.

A group of 60 employees published an open letter alleging the business was built upon a “cult of personality” around its founders, Mr Watt and Martin Dickie, with “growth at all costs” the overarching focus of the company.

They claimed a “significant number” of ex-employees suffered “mental illness” as a result of working at the group and were left “burnt out, afraid and miserable”.

Mr Watt is getting the firm ready for a stock market flotation possibly as soon as next year.

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The group have already responded to the open letter and has made changes.

It stressed that the employee reward scheme was not about mending relationships with employees, but “building the best company we possibly can”.

Mr Watt told PA news agency: “Everything we’re doing today is about looking forward with a fantastic team.”

Mr Watt said the group wanted to create a “new type of business”.

“It will help with every element of our company – recruitment, retention and team engagement.

“Ultimately it’s about ownership. We want our team members to act as business owners and incentivise them as if they are business owners.”

The stock will only vest once the group floats or if there is a sale or change of ownership, allowing staff to cash in only at that stage.

Mr Watt said the group was unlikely to float in the next 12 months given the market uncertainty.

He said a listing was “very much part” part of the plan in the medium term, with an initial public offering (IPO) in 2023 a possibility.

Co-op chairman and former Asda chief executive Allan Leighton was brought in last year as its chairman to help beef up governance ahead of an IPO.

Mr Watt said he hoped the reward schemes would act as a “blueprint for a new type of hospitality model”.