R.J. Reynolds Tobacco confirmed on Tuesday it was offering voluntary retirement to production workers ahead of the pending sale of its parent company, Reynolds American Inc. to British American Tobacco, according to a story by Richard Craver for the Winston-Salem Journal.
“We manage our businesses for maximum flexibility, and several factors led us to believe this was a good time to offer some production associates an opportunity to retire with severance benefits,” Reynolds spokesman David Howard was quoted as saying.
“This is on a voluntary basis – we do not plan any involuntary job eliminations regardless of how many employees sign up.”
Reynolds is estimated to have between 2,000 and 2,200 local employees, the majority of whom work at its Tobaccoville plant, but the company has refused to provide a local workforce count in recent years.
Reynolds had 5,500 full-time and 50 part-time employees as of December 31, according to its 2016 annual regulatory report. The total includes 3,700 Reynolds Tobacco, 500 Santa Fe Natural Tobacco and 600 American Snuff employees.
The bulk of the remaining Reynolds Tobacco employees are sales and marketing representatives out in the field serving retail, wholesale and distribution customers, as well as about half of Santa Fe’s workforce.
BAT said in a January 18 regulatory filing that it “has no plans to close or move the head office in Winston-Salem, nor make any significant changes to the current high-quality manufacturing facilities in North Carolina and Tennessee, nor to the trade marketing team”.
But Nicandro Durante, BAT’s chief executive, said in a letter to BAT shareholders that the company projected $400 million in cost savings by July 2020. Such a saving would mean eliminating duplicate corporate functions, greater supply chain economies of scale and enhanced manufacturing efficiency from Reynolds’ two-million-square-foot Tobaccoville plant.
Craver’s piece is at: http://www.journalnow.com/business/business_news/local/reynolds-offers-voluntary-retirement-packages-to-select-production-workers/article_558dab5c-6df6-5429-afe7-607be539fbb2.html