The 67 meat workers set to lose their jobs from Silver Fern Farms' Frasertown plant will receive a quarter of the redundancy agreement owing to workers of a unionised Southland meat works, also earmarked for closure.

The company announced on Tuesday it was consulting with staff at its Frasertown - inland from Wairoa - and Mossburn plants on options for closing.

Wairoa mayor Craig Little said he was disappointed at the Frasertown plant's closure, but not surprised.

"All I'm concerned about are the staff," he said.


"It has been closed more than it has been open in the last couple of years.

"I don't know how many of them have managed to hold on.

"I think Silver Fern have tried every way possible to keep it open."

He said because it was isolated and small it was unlikely to have the scale necessary to absorb increasing compliance costs.

Silver Fern chief executive Dean Hamilton said Frasertown was closing because there was an opportunity for the company to become more efficient and offer farmers better service by operating fewer plants.

"Both plants operate in regions where we have other plants which can manage the combined levels of livestock processing in the region," he said.

Frasertown employees would have the option of transferring to Silver Fern plants in Takapau or Hastings.

They are small plants. Frasertown employs 67 staff and does not kill cattle. Mossburn employs 43 staff and only kills venison.

Takapau employs about 1000 people at the height of the season.

The difference in redundancy packages is because Frasertown is not unionised - the workers are on individual contracts.

New Zealand Meatworkers union organiser Eric Mischefski said the company was unsuccessful in unionising the Frasertown workforce to negotiate a collective contract.

He said the redundancy payment offered to Frasertown workers was something Silver Fern was not legally obliged to pay.

Union secretary Graham Cook said after Silver Fern took ownership of the plant from the Frasertown Meat Company in 2011 "we repeatedly put it to the company that their workers should go on the exact same collective agreement redundancy package that Silver Fern has throughout New Zealand".

"They are receiving an ex gratia payment about a quarter of the full exit package of the Mossburn workers - there is an argument there about fairness that we are putting to them," he said.

Silver Fern had a reputation for making an effort to retain skilled workers and a bus to other plants was a possibility, despite it being a two-hour commute to Hastings, he said.

The closure would likely be a boon for Affco Wairoa but some farmers may opt to supply Ovation Meats' plant in Gisborne, he said.

"When a company shut down a plant in an area farmers usually have an allegiance to supplying their immediate area."