Lakeland Dairies has temporarily laid off 140 staff at its Killeshandra site in Co Cavan.The move is understood to be directly related to the COVID-19 hit the co-op has taken on its foodservice products. These include UHT milk and mini butter packages typically used in restaurants, hotels and other outlets, as well as milk sticks used in coffee shops.
Lakeland Dairies has temporarily laid off 140 staff at its Killeshandra site in Co Cavan.
The move is understood to be directly related to the COVID-19 hit the co-op has taken on its foodservice products. These include UHT milk and mini butter packages typically used in restaurants, hotels and other outlets, as well as milk sticks used in coffee shops.
The Irish Farmers Journal understands that a plan was agreed between Lakeland and its employees which includes staff using annual leave as well as short-time working and temporary layoffs for a period of four weeks.
Some staff in the ice cream manufacturing area are expected to be called back next week.
Lakeland processes around 1.8bn litres of milk per year and has another foodservice-focused site in Newtownards, Co Down.
However the Irish Farmers Journal understands there are no job losses at the Co Down site.
The layoffs are the latest in a series of measures taken by Lakeland in recent days.
The foodservice sector across Europe has suffered near wipe-out
Milk price cuts
The co-op cut milk price for its suppliers north and south last week.
A spokesperson for the co-op said COVID-19 was having a dramatic impact on the dairy markets.
“The global dairy markets have collapsed,” he said.
“The foodservice sector across Europe has suffered near wipe-out following the closure of restaurants, cafes, hotels, while airlines have grounded many planes. Food service is an important route to market for Lakeland Dairies and many dairy processors across Europe.
Downward pressure
“Prices for butters, powders and cheeses are under significant downward pressure as food service milk is now flooding into powders and butter," the spokesperson added.
“Closer to home, sales of fresh milk and butter in retail outlets have increased somewhat but this increase has not offset the drop off in sales in the food-service market.”
Lakeland’s management, led by CEO Michael Hanley, last week told the co-op's board that they will take a round of pay cuts as the COVID-19 crisis deepens.
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