Diageo, the producer of alcohol brands such as Johnnie Walker, Guinness and Smirnoff, has announced a significant restructuring of its Scottish business which will include the loss of up to 500 jobs.
According to the company, the planned restructuring follows a major review of how they can best ensure the long-term sustainability of their operations in Scotland in the current economic conditions.
The plans will mean the closure of Diageo sites in Kilmarnock and at Port Dundas in Glasgow by 2011 and will lead to the loss of up to 900 jobs.
Diageo says the job losses will be off-set by the creation of around 400 new jobs through the expansion of a packaging plant in Fife but will still result in an overall reduction of up to 500 jobs in Scotland.
Having communicated its plans, Diageo will now engage in formal consultation with employees but says there will be no compulsory redundancies at impacted sites for 12 months.
Bryan Donaghey, Managing Director of Diageo Scotland, said: “These decisions have been extremely difficult to take. We have only reached them after an exhaustive review of all the possible alternatives. I am sorry for the impact this announcement will have on our employees and their families in Kilmarnock and Glasgow and the difficulty this will cause in Kilmarnock where we are a major employer.
“We believe the plans announced today will help secure the sustainability of our business in Scotland. As Scotland’s largest manufacturing exporter, 85% of our output from Scotland is exported to over 180 markets worldwide. We therefore need to be competitive in a global context and the restructuring announced today is a key part of this.”