Cadbury cuts 145 jobs in Dunedin

Confectionery giant Cadbury Schweppes will cut 330 jobs across Australasia, including 145 of 700 jobs in Dunedin another blow to the Otago economy.

Changes announced in its chocolate-making operation also mean chocolate bars and blocks now made in New Zealand will be imported from Australia.

Yesterday afternoon, staff at Cadbury plants in Australia and New Zealand were called to meetings to be told of the 330 redundancies, which are coupled with $153 million of capital investment across the factories, including $51m in Dunedin, to simplify chocolate-making operations.

The company plans to cut 145 jobs from its Dunedin factory, 160 in Tasmania and 25 in Victoria.

It was a carefully stage-managed announcement with workers who attended the Dunedin meeting largely refusing to comment when they left, instead handing reporters cards with contact details for the company.

One worker told The Press yesterday a gagging clause in their employment contract meant they could not talk.

Service and Food Workers Union southern regional secretary Campbell Duignan, who was not at the Dunedin meeting, said he thought workers would be stunned by the cuts.

"I don't think anyone would have picked this we were only advised today of a meeting being held, so to some extent it's a bolt from the blue."

He described the announcement as a "mixed bag".

"We're absolutely gutted for 145 hard-working Dunedin people, who will lose their employment ... (but) the capital investment of more than $50m, I'd have to say, for the long-term security of the plant, it's not a bad thing."

Cadbury Schweppes managing director of confectionery Mark Callaghan said yesterday the job losses were needed to compete in the extremely competitive sector.

A final decision on the proposal will be made late next month, following consultation, and workers were expected to be laid off from the beginning of next year until the end of 2010.

The factories each make multiple products now but, after the restructuring, will specialise in certain chocolate products. Dunedin will concentrate on assortments and box chocolates, while bars and blocks will be imported from Australia.

"Hopefully, it's good news, the fact we're committed to staying here, we're saying it's a viable future here, will put a lot of people's minds to rest," company spokesman Daniel Ellis said.

The job cuts are another blow to Dunedin, after Fisher & Paykel said in April it would be shedding 430 jobs from its Mosgiel plant and meat company PPCS announced layoffs of nearly 140 jobs from its Burnside site.

The city's Mayor, Peter Chin, said yesterday he thought the capital investment was a commitment to stay.

"The unfortunate thing, really, is the loss of 140-odd jobs."

Otago Chamber of Commerce chief executive John Christie said he wished redundancies were avoidable but he thought there was now "significant potential" for new jobs in the longer term.

Cadbury recently spent $20m expanding its Dunedin plant to tap into exports to Asia, which the company said in 2006 would create 10 to 15 new jobs initially, and more as exports grew. It also spent $10m moving equipment from its Avondale factory.

This year, Cadbury denied rumours it was closing its Dunedin plant.

That followed focus groups run by the company in Christchurch in March, at which participants were asked if they noticed a difference in taste between chocolate made in Australia and New Zealand and would they mind eating Australian chocolate.

In April, Cadbury Schweppes' Melbourne-based corporate affairs manager Robyn Newman dismissed the research had any hidden meaning, saying the company regularly conducted that type of research in Australia and New Zealand.

- © Fairfax NZ News