Kraft Heinz Layoffs Hit Post Merger
NORTHFIELD, Ill. — One month after making its debut as a newly merged company, The Kraft Heinz Co. is cutting 2,500 jobs across its facilities in the United States and Canada, including 700 workers at the Kraft corporate headquarters in this Chicago suburb.
Part of a cost-slashing plan in the wake of July's merger of Kraft Foods Group and H.J. Heinz, the anticipated job cuts, which were announced Wednesday, take effect immediately. Effected employees will receive six months of severance benefits and outplacement services, according to published reports.
"As we work to build something special at The Kraft Heinz Co., the leadership team has examined every aspect of our business to ensure we are operating as efficiently and effectively as possible," Michael Mullen, Kraft Heinz, senior vice president of corporate and government affairs, wrote in an e-mail, reported by the Chicago Tribune.
"We have developed a new streamlined structure for our organization to simplify, strengthen and leverage the company's scale. This new structure eliminates duplication to enable faster decision-making, increased accountability and accelerated growth," he added.
Kraft Heinz previously announced its plan to move one of its Northfield headquarters from its vast suburban campus to a smaller space in the Aon Center in downtown Chicago. The company also maintains headquarters in Pittsburgh, ancestral home of Heinz, which cut 20 percent of its workforce following its 2013 acquisition by Berkshire Hathaway and 3G Capital.
Earlier this week, Kraft Heinz affirmed its commitment to cut costs by $1.5 billion by the end of 2017. The company also reported sales declines at both its Kraft and Heinz units for the second quarter that ended in June, before the merger took effect.
"The company is focused on the difficult and challenging process of integrating our two businesses," Kraft Heinz CEO Bernardo Hees said. "We have a lot of hard work ahead of us as we continue to design our new organization, always putting our consumers first."
Last month, Kraft Heinz reportedly told workers to limit travel expenses, limit printing and find ways to reduce energy use, the Tribune reported.