No forced job losses at closed parcels section, says An Post
COMMUNICATIONS Minister Dermot Ahern said yesterday that An Post’s decision to close its SDS parcels division was “a pretty serious situation” for the company and its employees.
He said his department had been in contact with An Post management, which assured them there would be no forced job losses. “We are talking about a total employment of about 500 in SDS and about 180 of those, we hope, will be retained,” he said. A total of 270 jobs are expected to be lost, while the remainder of the jobs are on a contract basis.
There would have to be discussions with staff and unions about how SDS would be reintegrated into An Post, he said.
The minister said it was regrettable that the news reached staff first via the media. There had been a board meeting the previous day and “people talked after that”.
Mr Ahern said the staff knew SDS was the An Post division which had for several years been losing the most money – about 30m over the last five years.”An Post management and board have been looking at the possibility of a sale or a joint venture. A number of companies looked at it but were not interested in buying,” he said. “So the board in its wisdom decided to reintegrate the parcel division into An Post.”
This, he said, was in the context of postal volumes being down significantly both in Europe and worldwide – mainly because of the increase in internet use.
The decision to close SDS may complicate negotiations on a wider restructuring of the postal service.
The move will provoke union anger as there was an agreement in May last year to restructure the loss-making parcels division rather than close it. The new job cuts are in addition to 1,450 staff earmarked for redundancy last autumn in response to losses of 43m last year.
Meanwhile, crippling financial losses and spiralling production costs are being blamed for the shock departure of Unifi Europe Ltd from Letterkenny, Co Donegal,writes Anita Guidera.
News of the winding down of operations at the textured yarn manufacturing plant, which will be complete by the end of October, has stunned the remaining 285 workers who are due to go on holidays today.
President of the European operation, Fintan McGrath, told a press conference at the plant yesterday that a major restructuring programme introduced last March had not been enough to reverse the losses.
He said the Letterkenny operation – once in the top 10 ESB customers in the country – has experienced a 20pc rise in electricity costs in the past four years and pays a staggering 650,000 in rates to the local authority.
The European wing of the US based multi-national filed sales of 90m and losses before tax of 10m in the year to June 2003. This represented an almost 7m in losses on the previous year.
Within the context of an intensely competitive international market, such cash losses could not be sustained, Mr McGrath said.
Tanaiste and Enterprise Minister, Mary Harney acknowledged the difficulties in attracting foreign investors into Donegal. She urged workers at the Unifi plant to avail of Fas courses in the coming months to retrain.
Gene McKenna and Gerald Flynn
