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Update on Smithfield's Pork Restructuring Plan

by 5m Editor
19 February 2009, at 9:13am

US - Smithfield Foods, Inc. released additional details of a restructuring plans that will consolidate and streamline the corporate structure and manufacturing operations of its pork group and make the company more competitive. The plan will improve operating efficiencies and increase utilisation.

Reorganization

As part of the plan, a reorganization will consolidate several business units:

  • John Morrell & Co. and Farmland Foods, Inc. will merge their respective fresh pork sales groups. Some members of the John Morrell sales group will be offered positions at Farmland Foods in Kansas City, Missouri or elsewhere within the Smithfield Foods organization.

  • Patrick Cudahy, Inc. will become part of the John Morrell Group. Plant employees will not be impacted at this time.

  • Carando Foods, currently a unit of Farmland Foods, also will become part of the John Morrell Group. Employees will not be impacted at this time.

  • North Side Foods Corp. will become a part of Farmland Foods. Plant employees will not be impacted at this time.

  • Cumberland Gap Provision Co., a unit of the John Morrell Group, will become part of The Smithfield Packing Company, Inc. Production from other Smithfield Packing Company facilities will be transferred to Cumberland Gap and employment there is expected to increase over time.

Plant Closings

Smithfield Foods will close six plants and transfer production to other facilities.

Wherever possible, Smithfield Foods will offer transfers to other company facilities to an undetermined number of employees. The company will work with employees and union officials, where applicable, to determine what assistance may be provided to affected employees to find future employment. Potential options include working and coordinating with area businesses and services to help find local opportunities for employees as well as coordinating with unemployment offices to assist employees with claims or job applications.

The company will comply with the federal Worker Adjustment and Retraining Notification Act (WARN), including providing a 60-day notification of plant closures to employees. Under the WARN Act, the company also will notify state dislocated worker units so that they can promptly offer dislocated worker assistance. WARN Act notices, where appropriate, have been issued.

  • The Smithfield Packing Company South facility in Smithfield, Virginia will be closed. Case ready fresh pork production will be moved to the adjacent Smithfield North plant and a North Carolina facility, creating significant operating efficiencies. Of the 1,375 Smithfield South employees, 1,035 will be offered transfers; 745 of those employees will be offered transfers to move to Smithfield North and the others will have the opportunity to move to Smithfield Packing Company plants in North Carolina. The plant is scheduled to close in December.

  • A Plant City, Florida facility producing packaged meats will close in September, affecting 760 Smithfield Packing Company employees. A number of salaried employees will be offered transfers.

  • The Smithfield Packing Company plant in Elon, North Carolina will close late in the summer and country ham production there will cease. About 160 employees will be affected.

  • A John Morrell plant in Great Bend, Kansas, with 275 employees, will close in July. The plant processes fresh pork and smoked meats.

  • Farmland Foods will close its New Riegel, Ohio plant. The plant will be shifting spiral ham production to other facilities and closing in April. About 230 employees will be affected. The company will offer transfers to other facilities to some salaried employees.

  • An Armour-Eckrich Meats, LLC packaged meats plant in Hastings, Nebraska will close in July, affecting about 370 employees.

"Layoffs and plant closings are difficult but necessary decisions," said C. Larry Pope, president and chief executive officer. "We know that this will create adversity for the employees affected and we will work with union officials and others to determine how we can provide assistance to our employees to find future employment. Also, we will be transferring many employees to other plants."

Further Reading

- Go to our previous news item on this story by clicking here.