Weetabix has confirmed it has started a consultation with its UK staff to cut pay and working hours in response to increasing pressure from supermarket own-label products and the discounters.
A spokesman for Weetabix told FoodManufacture.co.uk: “We’re involved in discussions and talking about shift patterns and pay changes, but we won’t be drawn into making conclusions; there are a range of proposals being discussed.”
The company was planning to reduce working hours and pay to save millions of pounds and avoid compulsory redundancies, according to a report from the Telegraph today (April 7). The information came from a Union of Shop, Distributive and Allied Workers (Usdaw) briefing document to Weetabix.
However, the spokesman added: “Weetabix has always tightly managed its cost base in order to allow the company to drive growth. The breakfast category is dynamic and growing and the company needs to be able to adapt to meet the changing needs of today’s modern families.”
‘Adapt to meet changing needs’
It was also reported the 2,000 staff employed by Weetabix would see a 2.5% pay rise scrapped, as well as a reduction in premium rate pay and fewer weekend and night shifts.
A spokesman from Usdaw said: “We have recently commenced on-going discussions with Weetabix in relation to a number of proposals put forward by the company.” But he would not comment further.
The alleged proposals to cut hours and pay follow calls from unions to safeguard jobs at Weetabix two years ago, when 60% of the company was sold to Chinese firm Bright Food by London private equity firm Lion Capital.
Northamptonshire-based Weetabix was family-owned until 2004, before Lion Capital bought it in 2011.
‘Develop and grow’
Bright Food made statements to unions Unite and Usdaw following the acquisition that it would look to “develop and grow the business”, which would lead to “greater security”, Unite said in a statement after the takeover.
In the same statement, Usdaw deputy Midlands divisional officer Gavin Dadley said: “We have spoken to Weetabix to seek assurances about our members’ jobs and conditions of service and have been assured by the company that it is very much business as usual.”
Around £16M was invested into Weetabix’s UK processing facilities in 2012, following the roll-out of a lean production programme.
The company revealed in November last year that a new online sourcing system would help it drive down costs and deliver international expansion plans.
Weetabix launched a £5M marketing campaign this month (April 1) to increase the awareness of its new Weetabix On The Go Breakfast Drink.
Read why Jonathan Warburton prefers manufacturing brands to own-label products.