Will Kraft and Cadbury workers pay the price for Cadbury swoop?
Global unions demand Kraft ends its silence
1st February 2010
On the day (Monday) before Cadbury shareholders vote on the
revised offer from Kraft for the confectionery company, unions
representing the worldwide workforce of the two corporations are
demanding that Kraft ends its silence on the workforce's
future.
With only hours before Kraft takes over Cadbury, the unions say
there is still no information on the consequences of the purchase
for the workforces of both companies. The unions – representing
around 138,000 Cadbury and Kraft workers around the globe - say
that Kraft must now be clear about its intentions towards its new
combined workforce.
According to the unions, the conglomerate's silence on its plans
is spreading insecurity among a community that is all too familiar
with Kraft's policy of acquiring new businesses by borrowing only
to then pay down that debt with plant closure and job losses.
Unite, the union representing Cadbury and Kraft workers in the
UK and Ireland, the IUF (International Union of Foodworkers) and
EFFAT (European Foodworkers’ Union) have now written to Kraft's CEO
Irene Rosenfeld to urge that Kraft moves swiftly to allay concerns
that the takeover will be paid for in workers' jobs.
Speaking on behalf of both Cadbury and Kraft workers in the UK,
Unite's national officer for food and drink, Jennie Formby, said:
"Our workers at Cadbury are extremely worried that what was a
bright future for them will be dimmer under Kraft. And our UK Kraft
members are also anxious to learn what their future holds. But we
also need urgent details of Kraft’s plans for Somerdale, which the
companyy has repeatedly stated will be kept open, raising the hopes
both of our members and of the community around the site in
Keynsham.
"The workforces have been kept in the dark too long. Specific
questions have been put to Ms Rosenfeld by our European colleagues,
including will the take-over lead to the closure of existing plants
and will there be lay-offs? All these questions need urgent
answers.
"With the purchase of Cadbury sure to be completed in the next
24 hours, Kraft can no longer hide behind the secrecy of UK
takeover rules. The company must come clean on its plans because
workers are being left to dread the worst."
Last month, Unite warned Cadbury shareholders that Kraft's
mounting debt, estimated to be some £22 billion, means that there
will be an "irresistible imperative" to cut costs by cutting jobs.
Unite pointed to Kraft's policy of closures to generate income,
citing 35 sites closed over a five year period between 2003 and
2008 with the loss of some 20,000 jobs globally. With analysts
asserting that Kraft is an underperforming company, and even its
lead shareholder Warren Buffett saying it has paid too much for
Cadbury, the unions fear that Kraft will move quickly to recoup
expenditure, and that the fastest way to do that is to slash
jobs.
Stating that the acquisition is of major global significance,
the joint unions are demanding an urgent meeting with Kraft's
global management, warning that a country by country approach to
how Kraft's businesses absorb the costs of the Cadbury purchase is
not appropriate.
Jennie Formby continued: "There are only so many savings Kraft
can make through synergies in functions like administration. When
it is hungry for savings, and has the stock market baying for good
returns, where will Kraft turn next?
"Our worry is that it will be the workforce who pays the price -
and until Kraft tell us otherwise by making its plans clear, we
have to presume we are now in a fight to protect jobs and
investment."
Cadbury shareholders vote on the revised offer from Kraft
tomorrow, Tuesday. On the same day, Cadbury workers will head to
Westminster to press the government for support to win jobs and
investment guarantees from their new employer.
ENDS
