Dairygold to shed 1,500 jobs as profits nosedive

DAIRYGOLD confirmed yesterday that up to 1,500 jobs will lost in the co-op giant over the next three years.

Profits at the co-op fell from over 25 million to 4m last year

The net job losses in Dairygold will be less than 1,000 and up to 500 more will be lost through outsourcing initiatives and the sale and privatisation of some business units, a company spokesman said.

Dairygold stressed the jobs lost through outsourcing and the sale and privatisation of some units are expected to be retained by the new companies or through contracting.

"No final decision will be made until the review of the company's dairy division is completed next year and no plans have been made about the future of CMP diaries in Cork," the Dairygold spokesman stressed.

The company hopes that most of the net job losses can be achieved through voluntary redundancies and they want this to be negotiated in consultation with the unions.

The 3,000 workers employed by Dairygold received a circular from management yesterday confirming that the net job losses will be less than 1,000 when account is taken of outsourcing initiatives and the sale and privatisation of some business units.

Dairygold chief executive Jerry Henchy told Tánaiste Mary Harney within the past fortnight that there would be a need to cut between 1,500 and 2,000 jobs within the next three years. The rationalisation programme will include:

A major review of the four dairy divisions.

Selling off the beef division to a new processor who is expected to retain the current 200 workers.

Privatising the pig operations.

Assessing the future of CMP dairies in Cork.

SIPTU's South West regional manager, Gene Mealy, said: "Management has confirmed it will engage with the union in relation to its restructuring proposals but nothing has been agreed on the number of job losses or voluntary redundancies."

Labour Deputy Joe Sherlock who represents Cork East said: "This has the potential to deliver the most serious blow to the Munster region the Tánaiste has been given advance warning of these redundancies and it is incumbent on her to intervene to save as many jobs as possible."

Ms Harney's spokesman confirmed yesterday she did meet Dairygold chief executive Jerry Henchy on July 17, but he could not confirm what was said at the meeting. "This is a matter for the company," the Tánaiste's spokesman said.

He said Agriculture Minister Joe Walsh was aware of the rationalisation proposals for the dairy sector and a special forum in September will tackle the problem.

Meanwhile, Fine Gael called on the Government to freeze indirect taxes and charges in the next budget to restore competitiveness to the food industry and save jobs being lost in Dairygold.

"The planned lay-offs represent 5% of the food sector workforce and are a damning indictment of this Government's economic policy," said Fine Gael's Enterprise Trade and Employment spokesman Phil Hogan.

"The Government should reverse its decision relating to roll-over relief and capital allowances in order to stimulate job creation," said Mr Hogan.