CHINA: PepsiCo reaches deal with bottling plant workers
PepsiCo said it has received “overwhelmingly positive feedback” from staff about the deals
PepsiCo has said that 90% of workers across its 24 bottling plants in China have accepted fresh contract offers, ending protests over the firm's deal to sell the operations to Tingyi Holdings.
The US drinks firm said today (6 December) that it has received "overwhelmingly positive feedback" from staff representatives and trade unions about three deals presented to the workers. Of its 24 bottling facilities in China, PepsiCo confirmed to just-drinks that 23 have accepted one of the three offers, while negotiations are continuing with a plant in Lanzhou.
Last month, workers from around five PepsiCo bottling factories in China took part in protests against the sale of the company's bottling operations in the country to Tingyi. Staff cited fears for their jobs and wage cuts under the new owner.
Following the protests, PepsiCo told just-drinks that if the proposed alliance with Tingyi is approved by the government, there will be no change in employment contracts. However, the firm said today that, while it has no legal obligation to provide any compensation to employees, it has since approached representatives and unions with three offers, drawn up jointly by PepsiCo and Tingyi.
The first deal offers staff a guarantee of two years employment with no change to their original contract. The second option allows workers to claim the statutory severance compensation once the transaction closes, and then sign a new contract re-setting their tenure to zero.
The third option would see workers stay on under their current contract for one year following the close of the transaction, before effectively reverting to option two but with a higher compensation payout.
"We have received overwhelmingly positive feedback from associate representatives and trade unions about the plan," PepsiCo said in a statement. "We believe the proposed alliance will create economic growth opportunities in China that will be good for associates ... and good for Chinese consumers."
A spokesperson for PepsiCo told just-drinks that the company is currently in negotiations with representatives of the staff at its bottling plant in Lanzhou who have expressed dissatisfaction with the deals.
"We have some staff at the Lanzhou facility that are unhappy with the offers," the spokesperson said. "We are talking to them some more and explaining the future of the proposed alliance."
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