Kinleith business announces consultation outcome

Carter Holt Harvey’s Kinleith business announces consultation outcome

Brice Landman, Chief Executive of Carter Holt Harvey Kinleith, announced the new structure for the Kinleith pulp and paper mill today, following two months of consultation with employees.

“The key features are that we have increased by 19 the numbers of positions in the 27 March proposed structure and the proposal to outsource maintenance services at the mill has been confirmed” said Mr Landman.

Current 27 March proposal 27 May decision

Maintenance In-house Outsourced Partnership Outsourced Partnership
CHH employees 770 370 389
Maintenance contractor employees 0 190 (est) 190 (est)
Total workforce on site 770 560 579

The company aims, through the reorganisation, to put Kinleith on a sustainable footing from which it can succeed globally. The company said that outsourcing maintenance will improve financial performance by at least $12 million per year, a result which none of the other options, which were considered, can deliver.

Mr Landman said that Carter Holt Harvey would begin negotiating a full service maintenance contract with ABB immediately. “We recently received a comprehensive proposal from ABB, and I am confident that they have the right combination of skills, experience and attitudes required to make such a partnership work for Kinleith.”

Submissions on the 27 March proposal were received from many salaried employees, said Mr Landman. “As we said in March, we wanted input from employees to improve the proposal, and I am pleased to say that is exactly what happened. For example, two submissions identified a gap in our knowledge management systems, and as a result we have created four entirely new positions which will improve our competitive capability.”

However, Mr Landman said that he was disappointed that almost no waged employees attended the 30 consultation meetings arranged for them.

A second round of consultation will now consider the best way to implement the new structure. This will be followed by an assessment process for employees in July and August, with final implementation in September.

The company is also continuing to negotiate with the combined site unions to secure a collective employment agreement to replace the agreement that expired in March 2001. There is no time constraint on those negotiations.

“I am pleased that we have made good progress towards securing a sustainable future for Kinleith,” said Mr Landman. “The continuing rise in the New Zealand dollar underscores the absolute necessity of dramatically improving the mill’s performance so that we can compete effectively with the new mills being built in Russia, Chile and China.”

ENDS

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