Closure of tissue plant puts 118 jobs at risk

Photo / Martin Sykes

New Zealand's biggest supplier of tissue products is to close its Auckland factory, putting the jobs of 118 workers at risk.

SCA Hygiene, which produces material for the brands Sorbent, Purex, Handee and Treasures, told employees at its Henderson site that it would cease manufacturing by early 2010.

Engineering, Printing and Manufacturing Union organiser Cliff Gunning said workers were devastated when the company broke the news.

"I've worked with the company as an organiser for more than 20 years in its various guises, and I've never known the workers to be so absolutely gobsmacked silent ... They're in shock," he said.

"People had clear suspicions that something would happen, but it's the usual story - 'it's going to happen to someone else, not to me'."

The company has two other productions sites - at Te Rapa near Hamilton and Kawerau in the Bay of Plenty.

Mr Gunning said up to 30 jobs could be saved by the moving of a piece of machinery from the West Auckland site to Te Rapa, but it would depend on employees' willingness to move cities.

SCA's director of supply Kerrin Thomson said staff would be given the chance to relocate to the other sites in the North Island. Those unable to do so would receive their entitlements in line with their contracts.

But Mr Gunning said there was "no way in the world" that all of the employees could be found jobs at other sites. "70 or 80 people will lose their jobs, at best."

Mr Thomson said the proposal followed a two-month review of the company's New Zealand manufacturing operations.

"We have considered a range of possible options that will allow us to continue manufacturing in New Zealand. We believe the best solution is to wind down our Auckland operation over the next year and consolidate production in our Te Rapa and Kawerau facilities," Mr Thomson said.

The Henderson site was running at a loss of $3.5 million a year, while the Te Rapa and Kawerau factories remained profitable.

Mr Thomson said SCA would begin a consultation process with workers next week, some of whom had been at the factory for "a considerable period of time".

Mr Gunning said that the company worked constructively with the union but that did not leaven the fact that many jobs would be lost.

He said: "John Key should be excited to learn that 80 workers will now be available to put a cycle track through the Waitakere Ranges."

SCA is a Swedish-based company with 52,000 employees in 60 countries. Annual sales in 2008 were $25.4 billion.