The Irish Farmers Journal understands that staff at Tipperary Co-op were made aware of an upcoming redundancy package and up to 14% wage cuts across the staff base last week.

The move comes as interim CEO John Hunter attempts to establish a path for the business amid ongoing speculation that the board and management are in talks with a neighbouring co-op about collaboration in the future. Hunter, who was appointed to his current position in April, has spoken individually to some disgruntled milk suppliers that have sought to leave Tipperary Co-op and asked them for patience until the end of the year as he tries to navigate a way forward for the co-op.

A statement to the Irish Farmers Journal said: “Tipperary Co-operative has embarked on a consolidation programme to address current business challenges.

“We have identified savings that need to be achieved across all areas of the operation. We are working through this in a spirit of partnership with our people.

“We are achieving labour savings which are not easy for our staff but show their commitment to the co-op. This is fully appreciated. Thanks to that commitment, the savings we have already achieved and other measures we are seeking. We are confident we will restore the co-op to a positive footing, ensuring its legacy of 125 years of operation will continue long into the future,” the statement said.

Tipperary sources part of its milk supply from other processors and there is currently an excess of processing capacity in the industry.