Union challenges Mondelēz cost cutting strategy

By Douglas Yu

- Last updated on GMT

Mondelēz says restructuring program allows it to reinvest in the business. Photo: iStock - chiarabramuzzo
Mondelēz says restructuring program allows it to reinvest in the business. Photo: iStock - chiarabramuzzo

Related tags Trade union Mondelez

Food workers unions across the globe, including BCTGM, vow to prevent Mondelēz from moving jobs to low-income areas through its cost-cutting strategy. But the Cadbury owner says its restructuring program is driving efficiency. 

“BCTGM (the ​Bakery, Confectionery, Tobacco Workers and Grain Millers' International Union) will not allow Mondelēz to continue to destroy the jobs of its employees and the lives of their families and communities,”​ BCTGM’s strategic campaign coordinator, Ron Baker said.

BCTGM is an international union that is affiliated with the International Union of Food and Beverage Workers (IUF).

Mondelez’s cost-cutting strategy

In a statement, the union says Mondelēz's cost-cutting strategy erodes job security and working conditions for the company’s employees.

“Mondelēz has been and continues to be engaged in cost cutting via sending higher paying jobs in one part of the world to areas of the world with lower wages and benefits for workers,”​ Baker told ConfectioneryNews.

ConfectioneryNews​ previously reported the company confirmed to open the world’s largest cookie plant in Mexico, and to close two gum factories in Lebanon and Morocco. Plus, 250 workers at a Mondelēz's chocolate factory at Bournville were let go recently.

“Over time, this strategy kills the US consumer base that supports their best markets and therefore undermines their own strategy in the long term,”​ Baker said.

Mondelēz self-defense

The company’s restructuring program, in some cases, meant closing some antiquated facilities around the world, according to Mondelēz's senior director of corporate external communications, Michael Mitchell.

However, he was unable to provide a list of global facility closures over the past several years.

“Our efforts to build the capabilities of our people and install state-of-the-art manufacturing equipment are dramatically increasing productivity, which is freeing up cash to be reinvested in the business,”​ he said.

To respond to international food worker unions’ accusation, Mitchell said Mondelēz has an integrated global supply chain that is committed to “providing colleagues with good, quality employment and fair, competitive compensation and benefits.”

“In the locations and facilities in which our employees are represented by unions, we comply with the collective bargaining agreements that are in place,”​ he added, however didn’t specify what those agreements were.

The fight continues

Baker alleged Mondelēz''s cost-cutting plan was short-sighted and ignored the communities and employees who have supported it for decades.

“Our fight against Mondelēz's ongoing destruction of well compensated work through its movement off shore or across borders will continue for as long as it takes to effectively address it,”​ he said.

“Mondelēz strategy of denying people work in one area and placing it elsewhere does not and will not benefit employees on either side of the issue nor will it benefit Mondelēz as a company in the long term.”

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