In August, Coca-Cola Ireland announced its intention to close one of its unionised manufacturing plants in September 2008. The plant to be closed is located in Drogheda, County Louth, and will result in the loss of 256 jobs. This leaves one of the remaining Coca-Cola plants in Ireland which is non-unionised as the main producer of concentrate for the popular international beverage.
In late August 2007, Coca-Cola Ireland informed employees at its Drogheda Concentrates plant, County Louth, of its decision to close the facility in September 2008. The company said that its high-capacity plant in Ballina, County Mayo, along with a smaller plant in Athy, County Carlow, ‘are sufficient to meet the current and future demand for concentrate and beverage base supply from Ireland’.
Currently, 279 workers are employed at the Ballina plant and 60 are employed at the Athy plant. As a result of the decision to close the manufacturing plant in Drogheda, numbers employed between both plants in Ballina and Athy will increase by 90 employees. The smaller Athy plant is unionised. The company also announced that ‘112 shared services employees will remain in Drogheda, providing services to the Coca-Cola business system worldwide, including the two remaining Irish plants’.
The announcement was unexpected, and workers were reportedly unhappy with the perceived lack of consultation prior to the announcement at a general company meeting. The workers are mainly represented by the Services, Industrial, Professional and Technical Union (SIPTU), with craft workers represented by the Technical, Engineering and Electrical Union (TEEU).
A company spokesperson for the Drogheda plant stated:
Over the last 30 years, the employees in the Drogheda plant have made a very valuable contribution to the Coca-Cola business. The company will be offering a generous redundancy and early retirement package together with financial advice, job search, re-training and business start-up assistance for the employees affected. We are going into a period of consultation with the employee representatives on the redundancies which we are proposing to make.
Redundancy terms are attractive, based on eight weeks’ pay for each year of service, inclusive of the normal statutory entitlement, with a ceiling of three and a half years’ pay. Often the ceiling in voluntary severance plans is set at two years or lower. Many of the workers at the Drogheda plant have given 20 years or more of service to the company. The average annual wages of the plant’s workers are in the region of €60,000–€70,000, which makes it one of the highest paying traditional types of employment in Ireland. The redundancy offer means that some workers could secure a once-off lump-sum payment of around €200,000.
Trade union representatives have implied that the decision has been influenced by the fact that the Ballina plant is non-unionised, and that the pay and conditions of workers are ‘far inferior’ to those at the unionised Drogheda plant. TEEU official Arthur Hall alleged that the move represented ‘corporate greed at its worst’. He claimed:
This is a highly profitable operation and it has not lost a day of production in disputes for well over a decade. The only reason why it is moving its main production to Ballina, that I can see, is that it has a non-unionised workforce there and can ensure less of its profits stay in the local economy.
A spokesperson for Coca-Cola strongly denied that this was the case, suggesting the move was about consolidating capacity across its operations. The spokesperson added that the Athy plant is unionised. Moreover, he highlighted that decisions such as this are taken at corporate level in the US, and that the job cuts are likely to have been rubber-stamped by senior management some time ago.
On a more general basis, it seems that American multinationals are increasingly less likely to recognise trade unions in new manufacturing plants in Ireland. In addition, a growing trend is emerging among unionised US companies of trade union avoidance when these companies are setting up sites on a non-unionised basis. Coca-Cola established its non-unionised Ballina plant in 2000, while the older unionised Drogheda plant was established in 1975.
Brian Sheehan, IRN Publishing