Kraft Foods Romania Employees, Mgmt Reach No Agreement In Severance Pay Negotiations

Employees accuse the management of using "dusty negotiation techniques” and consider the severance offer is much lower than their demands, according to a press release signed by union leaders Dragos Grigore and Raluca Coltea.

"We had a round of negotiation at the end of last week with the management of Kraft Foods. No agreement has been reached. Moreover, the management withdrew the offer it made on Nov 27, citing it didn’t get all the necessary approvals on a regional level, and came up with a lower offer," they said.

Employees demanded a severance package for a minimum three years plus other benefits, which the management rejected.

Negotiations will be resumed Wednesday, but employees said they won’t get their hopes up and are determined to go further with their actions.

"We’ve anticipated such a move, which seems to be a dusty negotiation technique. We are prepared to go ahead with our actions. Moreover, we are in close contact with the Federation of Unions in the Food Industry, which has assured us of its full support,” the union leaders added.

They added employees don’t plan to get rich following the company’s decision to shut down the factory, but to get a package to help them through an “unprecedented crisis in Romania".

Kraft Foods Romania corporate affairs manager Doina Cavache was not immediately available for comment.

Kraft Foods Romania said it would shut down its factory in Brasov by end 2009 and will relocate to Svoge, a small province town in Bulgaria. The first layoffs start in April 2009, and the unit’s 440 are to receive severance pay.

The company cited lack of expansion space as the reason for its decision, but although local authorities said they are willing to offer bigger lands, the decision was not overturned.

The company entered the Romanian market in 1994, when Kraft Foods International bought the local candy factory in Brasov, Poiana Produse Zaharoase.

Kraft Foods has annual revenues exceeding $37 billion, and employs over 100,000 people in 180 production units worldwide.