Fonterra heads on the block

Fonterra communications staff talk to workers leaving the company's Princes St offices last night. Photo / Dean Purcell

Dairy giant to cut hundreds of management and admin jobs, but employ more marketers.

Highly-paid head office managers are expected to be in Fonterra's sights as it slashes hundreds of administrative jobs to cope with falling global milk prices.

The dairy giant plans to create more marketing roles so it can sell its products better into overseas markets, where it also faces increasing competition from its rivals.

Last year the company had 2590 New Zealand staff paid more than $100,000 or more per year and 17 staff earning more than $1 million, according to its annual report.

Fonterra chief executive Theo Spierings, who earns $4.18 million a year, told media yesterday the company was in the middle of a major review, which began in December, to restructure the company's management team.

The changes would mean hundreds of job losses for its 1500 head office and support function staff, as the company focused on marketing and sales.

The announcement comes just seven months before the company's new headquarters in Auckland's downtown Wynyard Quarter are expected to be completed. Fonterra has signed a 15-year lease on the 16,000sq m seven-storey building. The building was planned to house 1000 of the company's head office staff, a number which could fall after the restructuring.

Despite the cuts, Fonterra was yesterday advertising 40 New Zealand jobs on its careers page, ranging from management through to sales and customer service.

It is unclear whether the company, which currently employs 11,500 staff in New Zealand and 18,000 worldwide, will put a freeze on hiring after yesterday's announcement.

Auckland Chamber of Commerce chief executive Michael Barnett said Fonterra staff laid off after the review should not have difficulty finding new jobs in Auckland's buoyant economy.

"If I look at Auckland Chamber's most recent survey, over a third of employers were saying they were having difficulty getting the right people with the right skills," Barnett said.

Fonterra staff leaving the company's Princes St headquarters last night declined to speak to the Herald.

Three communications officers stopped staff as they were leaving to advise them there was a reporter outside.