Up to 700 jobs at Fruit of the Loom in Donegal are under threat in the months ahead, while the company has confirmed the loss of 48 jobs, due to the closure of its Dungloe plant.
Staff arriving for work at the Donegal and Derry factories yesterday also learned of the departure of managing director, Mr Andy McCarter and director, Miss Mary Cullen. They will leave the company in October, while the day-to-day running of the Irish operation will be taken over by the head of apparel, Mr Joe Mullan.
Their departure, reported in yesterday's The Irish Times, heightens concerns for the future of the Irish plants. While the company has promised that there will be no further lay-offs this year, up to 700 jobs in the T-shirt manufacturing division are now see as the most vulnerable, from the 3,500 strong workforce on both sides of the Border.
The 48 workers in Dungloe have been given three months notice. " We have taken the decision with regret," said Mr Felix Sulzburger, president and chief executive of Fruit of the Loom, Europe. The inflow of low-cost imports from less developed areas of the world has put pressure on the company's ability to remain cost effective," he said.
Appearing to point to further rationalisation in the months ahead, Mr Sulzburger said that Fruit of the Loom has a " major commitment" to its operations in the north-west, " but going forward we need to balance this commitment with the absolute necessity to maintain our competitiveness in the market. It continues to be a very difficult balancing act." Fruit of the Loom chairman and chief executive officer, Mr Bill Farley, is due to visit the Irish operations and meet with the Tanaiste, Ms Harney, over the next couple of weeks, when the picture will become clearer. The Tanaiste is expected to meet with staff, union officials and management at the company ahead of her meeting with Mr Farley.
Speaking to The Irish Times yesterday, Mr McCarter said his departure after 21 years with the company was "tinged with sadness, but inevitable". He said he was now looking at a number of opportunities and wished the company and its staff well in the future.
In a letter to workers, Mr McCarter and Miss Cullen said it had always been their intention to leave the company this year. The two directors had remained at Fruit of the Loom following the departure of former managing director, Mr Willie McCarter, his brother John and Finance Director, Mr Seamus McEleaney, last year in acrimonious circumstances. Mr McCarter had been instrumental in bringing Fruit of the Loom to Donegal and Derry initially when it bought his family business in 1986. Since then the McCarter family have continued to run the company.
There have been fears for the 700 jobs in the T-shirt division for some time now. Earlier this summer IDA Ireland had prepared for widescale redundancies.
Fruit of the Loom has given a commitment to the Tanaiste that there will be no job losses at the Irish plants this year. Sources now suggest the company will seek to move the T-shirt manufacturing operation to its sister company in Morocco which would lead to up to 700 redundancies in Donegal.
With sales following in Europe and declining profit margins in the T-shirt business the company is finding it increasingly difficult to justify its Irish location. Its sister company in Morocco provides a much more cost-effective base for this type of manufacturing. There are fears that any further delays in tackling this side of its manufacturing process could ultimately threaten the entire Irish operation.
