PRESS RELEASE: JANUARY 22, 2007

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Loblaw to cut up to 1,000 jobs at offices

January 22, 2007

Canadas largest supermarket chain says it is cutting 800 to 1,000 head office and regional office jobs.

Loblaw Cos Ltd. (TSX:L) said the cuts would take place over the next nine months, most of them in Brampton, northwest of Toronto.

The announcement is the third time in as many months that the company has announced a major cost-cutting initiative.

This latest move does not involve any job cuts at the store or warehouse level, the company said.

"We are a customer service business. We need to simplify our business processes ...This change is about making sure we support our store team more effectively," said Galen G. Weston, executive chair of the company and son of the major shareholder.

Since taking the helm four months ago, the younger Weston has also closed stores in Quebec and liquidated unsold non-food merchandise in a bid to compete more effectively with lower-cost rivals, such as Wal-Mart Canada Corp.

The job cuts represent "less than 15 per cent" of its regional and head office staff, a company spokesperson said.

Loblaw currently has more than 134,000 full-time and part-time employees.

The company will take a charge of between $150 million to $200 million in the first quarter of 2007 to cover related costs such as severance.



 

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