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Over 200 North Tipp Jobs Lost With Nenagh Factory Closure

Thursday, 16 March 2017

OVER 200 JOBS will be lost in Nenagh over the next year after global cosmetics brand, Coty, announced on Tuesday last it will cease operations in the town.

Coty confirmed that its plant in Nenagh will close by the end of 2018 and in a statement said it had carried out a detailed study of its global manufacturing and is to consolidate its cosmetics operations resulting in the closure of the Tipperary plant and the loss of 210 jobs.

The decision comes only a year after a merger with Proctor & Gamble Specialty Beauty brands, which made the company one of the biggest beauty companies in the world with revenues of over €9-billion annually.

There were concerns in the past that the merger may have implications for the plant down the line and staff were informed of the decision on Tuesday morning in a meeting at the plant - which has been one of the town's biggest employers since the late 1970s with a workforce of over 500 at its height.

Household names globally in hair and fragrance brands, products such as Calvin Klein, Clairol, Wella, Max Factor and Rimmel were all produced at the Nenagh factory.

Juan Miguel Pacheco, Plant Manager at Nenagh said he is committed to fully supporting colleagues in Nenagh through the coming months and that the company's priority is to work closely with them and their families throughout the consultation and to ensure that everyone is 'treated fairly and with respect.'

Nenagh Chamber of Commerce Vice President, Denis Finnerty, said the job losses were a huge loss for the local workforce and their families and that 'the worst fears of everybody had been realised.'

Mr Finnerty said national development needs to go beyond the eastern seaboard and it would not be easy for people losing their jobs to get work in the area and predicted many people from Nenagh and surrounding areas now face commuting or travelling to the United Kingdom.

In a statement on Tuesday. Tipperary County Council said it is particularly mindful of the impact of this announcement on all of the employees of Coty and their families and said 'our thoughts are with them at this very difficult time.'

'Over the years, this facility provided much needed and valued employment in Nenagh and is an integral part of the community, business and social life of Nenagh town and its environs. The announcement today presents a significant challenge for all concerned,' the Council statement said.

'However, the people of Nenagh have demonstrated resilience in the past when faced with similar announcements and the Nenagh area has consistently shown its ability to recover from job losses.

 

This recovery will require a co-operative and focussed effort by all national and local agencies working jointly with Coty, its employees and the business community of Nenagh. Tipperary County Council will play our role in this joint effort,' they said.

The Council statement said the elected members of Tipperary County Council have already written to the Minister for Jobs, Enterprise and Innovation seeking a meeting to discuss the current position in Tipperary with regard to job losses and 'the considerable number of opportunities in our county that exist to create new enterprise and employment.'

Additionally, at the request of the Minister for Jobs, Enterprise and Innovation, Mary Mitchell O`Connor TD, the Chief Executive of Tipperary County Council has put in place arrangements to convene a meeting of the Inter-Agency Group (consisting of the DJEI, IDA, Enterprise Ireland, Tipperary ETB, Tipperary Local Enterprise Office, Department of Social Protection, NTLP and Tipperary County Council) to assess the implications of the Coty announcement and to work with the Company and its employees to put in place employment supports including up-skilling, re-training and opportunities for potential re-employment,' they added.

Nenagh based Dail Deputy, Labour's Alan Kelly, who knows many of the workers well, said he has many friends and neighbours working in the plant.

'I have been speaking with some of them in recent hours and it is a difficult time for them as they have fought hard for many years to keep this plant open. This is a huge blow for the Nenagh area. The €14 million annual wage bill from employees has supported many families, along with local businesses and spinoff contract services and will be a major loss to Nenagh,' Deputy Kelly said.

'The immediate focus now must be to support the employees who will lose their jobs by the end of 2018 and ensure their redundancy package is honoured in its entirety, and assisting them to re-skill in the near future,' he said.

'Finding an alternative business to fill the site that has significant utility capacity and high spec finishes must now be a Government priority and we have a timeline up to the end of 2018 to do so. The IDA have been in contact with me over the last 24 hours and they have assured me that they will continue to advocate for Nenagh and Tipperary. We have seen a similar plant closure in Cashel reopen following the loss of Johnson and Johnson and it was subsequently replaced by Amneal - so there is hope,' Deputy Kelly assured.

Deputy Kelly highlighted that the average service in the plant is 14 years and the local workforce has a wealth of knowledge, experience and training that is invaluable.

'I have also been in touch with the offices of the Minister for Jobs and the Minister for Social Protection to ensure that all possible supports and assistance are made available to the workers and the local community,' he said.

Deputy Kelly said the Coty employees have been through a long period of uncertainty that stretches back to the 2009 loss of the skincare Olay business and 400 jobs to Poland. Following this there was a cost restructure where employees sacrificed overtime rates and other benefits in a bid to cut costs and secure the plants future.

'In 2014 Procter and Gamble announced a further sourcing study involving the Nenagh plant prior to the Coty merger that came into force in October 2016. It was hoped that a company that specialised in the beauty industry would take the Nenagh plant and its iconic Max Factor brand to the next level.

'Moving to Coty, the employees again made huge sacrifices in reducing their costs - most recently closing out on pension and share purchase scheme losses. The Nenagh factory had a solid business plan in front of Coty that did not require a single block to be laid in the state of the art facility, where over 600 workers were previously employed,' Deputy Kelly said.

'Ultimately none of this was to be enough. In a tale of two plants, one in Ashford, Kent and one here in Nenagh, the cost structure was deemed to be in favour of the UK site. This raises serious concerns about the impact Brexit will have on manufacturing,' Deputy Kelly said, adding he will do 'everything in power to help the employees.'

Following the announcement on Tuesday, Fianna Fáil TD for Tipperary, Jackie Cahill, said that 'questions need to be asked about the role of the Minister for Jobs and Enterprise as 210 former Procter & Gamble employees have been made redundant less than 18 months after the factory was sold to Coty.'

'First and foremost,' Deputy Cahill said, 'my heart goes out to the 210 staff members, and their families, many of whom have been working in the factory for over 20 years. Proctor & Gamble was a major employer in the Nenagh, and North Tipperary areas; they provided good quality, well-paying jobs that were the life blood of the local economy for decades.

'However, I have serious doubts about the role that Minister Mitchell O'Connor is playing in protecting Irish jobs from the threat of relocation,' Deputy Cahill said.

'Last month, I raised the future of the plant with the Minister via a parliamentary question and got a one line response saying that "ownership of this facility changed recently and IDA Ireland is working with the senior management of the new company in order assess potential future developments." What happened in the four weeks between answering question and the decision today to close the factory?,' Deputy Cahill asked.

Deputy Cahill said people have now been informed that the business will transfer to Ashford and Hunt Valley in the UK and asked 'how is it that we are losing jobs to the UK, and why has the Minister not intervened?'

'Was the Minister aware that this decision was coming down the tracks; what proposals did she, and the IDA, make to help keep the jobs in North Tipperary?,' Deputy Cahill said.

'The staff must now be must be given every support possible as decisions are made about voluntary redundancies. These job losses will undoubtedly have a wider knock on effect on the local Mid-West economy and the Government needs to ensure that workers are given the support they need to find alternative employment, as quickly as possible,' Deputy Cahill said.

Tipperary TD, Mattie McGrath also had many questions following the announcement and described the job losses as a deeply distressing announcement that will be received with huge disappointment and shock in the Nenagh community.

'We were all aware that since the merger with Proctor & Gamble in 2016 that reorganisation and "employment efficiencies" were on the cards,' Deputy McGrath said.

'What is distressing to the employees, however, is that despite Coty still operating with an estimated revenue of $9-billion, it still felt it had to make this move. Indeed Coty have informed us that the merger with Proctor & Gamble only enhanced Coty's already strong margins, cash flow generation and earnings power,' Deputy McGrath said.

'The questions must then be asked about why, when the company is not under any kind of immediate or even long term financial threat, is it moving the jobs from Nenagh to the UK? I think there are serious issues here relating to the role of these "mergers" that are increasingly just vehicles through which employees can be discarded,' he said.

'Another aspect of this episode has also left the loyal and hardworking staff fairly disgusted; and that is the manner in which they heard about the news. Many of them woke up to hear the rumours circulating on social media or on local or national radio - the staff deserved so much more than this and should have been informed at every stage of the process that was underway,' Deputy McGrath said.

Offaly/North Tipperary TD and Minister for Health Promotion, Marcella Corcoran Kennedy called on the mobilisation of all State agencies to support the 210 Coty workers in Nenagh following the announcement she has been contacted by a number of constituents who work at the company seeking advice and support.

'I have spoken to the Minister for Jobs, Enterprise and Innovation, Mary Mitchell O'Connor TD and have emphasised the seriousness of this situation for the local economy. The Minister has assured me that the resources of her Department and the Department of Social Protection will be fully mobilised to assist the employees at this very difficult time and I have also asked the Minister to come to Nenagh to meet the workers,' Minister Corcoran Kennedy said.

'The Minister has also confirmed that the IDA has begun to identify new investors for the Coty site in Nenagh. I welcome assurances from the Minister that every effort will be made to help the employees transition and find new job opportunities,' she said.

A statement from the Department of Social Protection said that staff from the Department's Intreo service have contacted Hannover Communications who are working on behalf of Coty to offer the Department's services, including briefing sessions and the provision of information about employment options, re-training supports, redundancy and welfare.

Minister for Social Protection, Leo Varadkar said 'this is a very distressing time for employees who have given so much to the company. My thoughts and those of my Government colleagues are with all the staff affected and the Department of Social Protection will do all it can to assist employees, including briefing sessions on welfare and employment supports. Our goal is to ensure that all staff affected can move smoothly into new employment or training,' he said.

'I want to assure everyone affected that the Department of Social Protection officials are determined to help them to get through this difficult period, and identify the supports they need to get back into employment again as quickly as possible,' Minister Varadkar said.

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