HKScan : Finland concludes statutory negotiations at the Forssa pig cutting department and Outokumpu production facility

HKScan Finland Oy Press Release Mar 2, 2017 2:00 PM

At the beginning of January, HKScan Finland announced plans to upgrade operational efficiency and improve occupational health and safety by replacing heavy manual work stages with automation at its Forssa meat cutting department. In addition, the Outokumpu plant is planning to adjust its beef slaughtering and cutting in line with prevailing market conditions, as there is currently not enough domestic beef available in relation to demand. The ultimate goal of these measures is to improve HKScan Finland's profitability. The statutory negotiations undertaken with the personnel of both facilities have now been completed.

Automation investment to proceed as planned in Forssa

HKScan intends to proceed as planned with its intended investment in new automation, which will be installed at the Forssa production facility between December 2017 and February 2018. The new automation and related reorganization will upgrade operational efficiency and also improve the plant's capacity to promote occupational health. The measures are expected to result in a headcount reduction of 8-12 employees at the Forssa pig cutting department.

HKScan estimates that the headcount reduction and other personnel effects estimated to take place early in 2018 can be achieved through reduced hiring of fixed-term employees, adjustment of working hours, changes in job descriptions as well as retirements and other voluntary arrangements.

Slaughtering and cutting to be downsized through layoffs at the Outokumpu facility

Beef slaughtering and cutting at the Outokumpu production facility will be downsized in line with current market situation through layoffs of approximately 4 - 6 weeks in duration. The layoffs will take place on a phased basis starting in March and April 2017 and continuing through to the summer holiday season. These layoffs will affect 15 employees at the Outokumpu plant.

Due to market uncertainty, there may be further layoffs in Outokumpu after the holiday season, and the possibility of a headcount reduction affecting 15-20 employees and/or altered working time arrangements cannot be ruled out altogether.

Alternatives to redundancy sought as a joint effort with personnel

The newly concluded statutory negotiations concerned the entire personnel of the Forssa pig cutting department (approx. 300 employees) and the production personnel of the Outokumpu facility (approx.130 employees). The anticipated headcount reduction in Forssa was originally approximately 15 employees and 20 employees in Outokumpu.

'The personnel showed an exemplary spirit of cooperation in negotiating future changes, which enabled us to find alternative solutions to the redundancies that we originally anticipated,' says Jyrki Karlsson, Executive Vice President, HKScan Market Area Finland. 'Continuous improvement and fruitful cooperation with our personnel are crucial for our future growth and market success. Thanks to recent negotiations, we now have a sound basis upon which to build our future.'

HKScan's Forssa plant specializes in the slaughtering and cutting of pigs and the Outokumpu plant specializes in beef.

For further information:

• Jyrki Karlsson, Executive Vice President, Market Area Finland, HKScan Corporation
• Kindly submit a call-back request via:
  Marja Siltala, VP Communications, HKScan Finland, firstname.lastname@hkscan.com, tel. +358 10 570 2290

HKScan is the leading Nordic food company. We produce, market and sell high-quality, responsibly-produced pork, beef, poultry and lamb products, processed meats and convenience foods under strong brand names. Our customers are the retail, food service, industrial and export sectors, and our home markets comprise Finland, Sweden, Denmark and the Baltics. We export to close to 50 countries. In 2016, HKScan had net sales of nearly EUR 1.9 billion and some 7 300 employees.