More job cuts loom as Norwegian recycling giant Tomra takes the axe to its New Zealand-based operations as part of a global restructuring of its food processing division.
The Herald understands dozens of redundancies are expected at manufacturing, sales and service sites in Auckland, Hamilton, Tauranga and Hastings.
Sources said the company is currently consulting with staff and there are fears of mass layoffs before Christmas. As many as 100 staff could be involved, the Herald was told.
Paul Slupecki, senior vice-president and head of Tomra Fresh Food based in Melbourne, was not yet able to disclose how many staff would be affected.
“We are currently engaging with our staff as part of the consultation phase for a proposed organisational restructuring. The full extent of the impact on our staff, including the number potentially affected, will be finalised later next week,” Slupecki said.
“We are focused on providing support to our staff right now.”
The expected layoffs are the latest in a series of redundancies hitting the New Zealand corporate and public sector in recent months.
This week, billion-dollar global game technology company Unity Software cut ties with Wellington visual effects house Wētā FX, resulting in 265 redundancies, although some staff may be kept on by Wētā.
Meanwhile, dozens of jobs at ultrafast broadband (UFB) network operator Chorus are being cut as the company further embraces a new operating model, the company has confirmed.
With New Zealand’s ultrafast broadband network build completed a year ago, the company says it has been moving from network builder to operator — and with that comes an impact on roles and people.
The exact number of jobs lost has yet to be confirmed but the Herald understands it will be in the “tens” rather than “hundreds”. Chorus employs about 850 people.
“We are now in the final stage of our organisational redesign,” said a spokesman.
And major hardware group Mitre 10 yesterday confirmed it was cutting 33 jobs.
Cam Caithness, managing director of Riviera Hardware Holdings — an owner of the biggest group of Mitre 10 stores — cited trading conditions as a reason for layoffs at Mitre 10 Mega Albany, Mitre 10 Mega New Lynn, Mitre 10 Mega Warkworth, Mitre 10 Whangaparāoa and Mitre 10 Mega Silverdale.
“We needed to realign rosters to reflect current trading conditions. Despite every effort being made to redeploy people, this has unfortunately resulted in 33 people leaving the business, most by way of redundancy and a handful by choice,” he said.
It is also hiring 20 staff.
Tomra, publicly listed on the Oslo stock exchange, announced a major cost reduction plan when releasing its third-quarter financial results in late October.
The company’s food business has been based on four acquisitions over the past 12 years, including a $70 million buyout of New Zealand fruit sorting company Compac Holdings in 2016, followed by a $66.9m purchase of Hamilton fruit technology manufacturer BBC Technologies in 2018.
While its processed food segment has been performing well, the company’s fresh food segment — which includes New Zealand operations — has been struggling in particular recently due to weak demand.
In its Q3 results announcement, Tomra revealed plans to simplify its food business and reduce costs by €30m ($53m).
Tomra Food executive vice-president Harald Henriksen, appointed to the role in June, told investors Tomra was using the downturn in demand for its food segment to reorganise and take advantage of unrealised synergies.
“We have five R&D sites and four production sites and a recent opportunity to take out synergies by fully merging these companies into one food organisation,” he said on a webcast.
“And the timing is quite good now, both because I’m coming in as a new leader and because we have a slower period within the fresh segment due to lower customer demand. This poor financial performance shows the urgency to ensure financial health of the food division.”
Henriksen said the aim was to create a regional structure consisting of the Americas and Asia Pacific and within those regions, merge the fresh and processed sales and service organisations into one team.
“We want to ensure we have the right people in the right place, in the right time zone.
“We will work through this change process which will be very demanding for all employees but we need to do it.”
Asked what impact the cost-reduction programme would have on group sustainability and the company’s net zero emissions plan, he said it was expected to be beneficial. That indicates its distant New Zealand operations formed a big part of the decision-making.
“We need to look at the distance we are sending equipment, it’s about the number of sites, so I believe that the sustainability impact will be positive out of the changes we will do.”
Tomra is understood to be cutting 300 roles globally.
In response to Covid lockdowns, Tomra’s BBC Technologies received just over $1m in New Zealand government wage subsidies for 145 staff, while Auckland-based Compac Holdings claimed about $1.9m for 268 staff at two subsidiary companies.
First Union president Bill Bradford said getting laid off just before Christmas could create a cluster of problems for workers.
“This time of year is stressful for most workers, particularly if you’re not on a really high income,” he said.
“Everyone wants to have a good Christmas. So for many workers, this time of year is when they want to do some extra hours.”
People also wanted to relax and have quality time with loved ones, so having no job to return to in the new year could make that impossible, Bradford said.
Additional reporting by John Weekes.