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(Bloomberg) -- Nestle SA’s job cuts in France will probably exceed 1,000 as the Swiss bottler of Perrier water prepares to shift support-staff roles out of the country, union officials said.
The coming efficiency drive will mean hundreds of job losses, according to Daniel Loget, secretary of the worker’s consultation committee at Nestle Purina in Paris. Attrition will spur some of those as Nestle consolidates seven sites around Paris into one, he said.
Two months ago, Nestle announced plans to cut most of the 550 positions at a Galderma skin-health research center in the south of France, so total job losses at Nestle’s French operations will be more than 1,000, Loget said. The company has 13,000 employees in that market.
“It’s especially tragic for those on small salaries and people who are the second incomes in their households,” Loget, an official at France’s CFTC union, said in a phone interview. David Le Doussal, a union coordinator for Force Ouvriere, also said Nestle’s French job cuts may exceed 1,000, fueled by attrition.
The stock rose as much as 0.9 percent to 85.50 Swiss francs in Zurich, within 50 centimes of Nestle’s record share price set in June.
Nestle has told worker representatives it will detail the effect on jobs in the first quarter of next year, according to a document from the Unsa union. Last week, the maker of Cailler chocolate and Herta lunch meats announced plans to consolidate seven sites around Paris under one roof by 2020, uniting business ranging from Nespresso to Purina.
Nestle France Chief Executive Officer Richard Girardot promised that every Paris employee would be offered continued employment at the new office in Porte de Versailles on the west side of the city, according to Pierre-Alexandre Teulie, a director-general of Nestle France.
Nestle sought a central Paris location that could fit all of its existing 2,500 area employees, Teulie said. He denied that the company was intentionally dissuading workers from moving and said the site will be close to public transport networks.
The new multiyear efficiency program would create centers for support services such as purchasing and logistics throughout Europe and the world in locations including Lisbon, Wroclaw, Poland, and Lviv, Ukraine, according to the union representatives. About 2,000 people work in such services at Nestle’s French businesses, Loget said. The country is Nestle’s largest market in Europe in terms of sales.
Nestle has had one of its main French offices in Noisiel, a suburb east of Paris, since 1995, and Purina moved its French headquarters there from the west of Paris three years ago. Rents are higher in the west, Loget said, and the move to Porte de Versailles threatens to saddle hundreds of employees who live near Noisiel with round-trip commutes approaching three hours. The last time Purina moved its headquarters, 30 percent of the employees left the company, according to the union official.
“They picked a site that’s inconvenient for the employees at Noisiel,” Loget said. “It’s not by chance.”
The efficiency push is part of a program that Nestle unveiled in 2014 to simplify its business-support structure. The company, Europe’s largest by market value, had 328,000 employees worldwide in 2016.
(Updates with shares in fifth paragraph.)
--With assistance from Corinne Gretler
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