The fallout from Silver Fern Farms' decision to axe the bobby calf kill at the co-operative's Fairton plant will have far reaching repercussions for Mid Canterbury's economy.

Almost 500 workers at the Fairton plant - on the outskirts of Ashburton - were told the bulk of the regions bobby calf kill would take place at Silver Ferns Pareora plant, putting their jobs in limbo for another three months.

The company and union representatives are at loggerheads over what happened at a meeting held earlier this month to discuss Fairton's fate.

Spokesperson Justin Courtney said Silver Fern put the option of running both plants on the table but workers would not agree to include weekends in their five-day working roster without compensation in the form of penalty rates.


"Under the current employment agreement the two-plant option was not viable," Mr Courtney said.

"In order to run both sites, our option required a seasonal variation to the employment agreement which removed the penalty rates from Saturday or Sunday work, if working within a five-day roster - it did not change anything for people who may have worked a sixth or seventh day.

"The employee representatives informed us this variation was rejected by both sites. It left us with the option of only being able to run one site."

However, New Zealand Meat Workers Union Canterbury secretary Bill Watt said Fairton and Pareora were part of the same collective, and as such the same pay rates and conditions applied.

Whatever the reason, the reality is starting to hit home for the Mid Canterbury economy.

"The economy is pretty fragile at the moment - there are a number of businesses hanging on by the skin of their teeth, and if things don't improve by the end of the year, they won't be able to hang on," Grow Mid Canterbury CEO Rob Brawley said.

Businesses servicing the agricultural sector were the first to feel the pinch, but the impact of the dairy downturn is now starting to flow further afield.

"The Silver Fern chain not opening up is going to put more pressure on - especially as there aren't the jobs around to mop those people up," Mr Brawley said.


"We are very concerned about the economy beyond farming actually, it's certainly as tough as has been for a very long time."

Ashburton mayor Angus McKay said the decisions was the company's to make but he too was concerned about the loss of work in a tight job market.

- Ashburton Guardian