Food manufacturer Goodman Fielder has delayed the closure of its factory in Western Australia, due to issues with its supply agreement with George Weston Foods.
Earlier this year, Goodman Fielder announced plans to cease production at its Malaga, Perth plant by April 28. The plan was to enter into a supply agreement with George Weston Foods under an agreement which covered packaged bread from brands Wonder White, Helga’s, Molenberg, Lawson’s and Mighty Soft. This was to commence on May 1, with 75 staff to be made redundant.
However, Goodman Fielder has told staff at the Malaga plant that the closure and supply agreement have been postponed until July 1 due to lack of clearance from the Australian Competition and Consumer Commission (ACCC).
The ACCC is currently evaluating the impact of the factory closure and supply agreement on competition in the WA bread market. The group has received submissions from other local bakers and food services companies that are opposed to the deal, according to industry sources.
Under the proposed agreement, George Weston will manufacture 98 per cent of the Malaga factory’s production, with the remaining two per cent (which covers the Lawson’s brand) to be produced by independent Perth baker, Bovell’s.
Goodman Fielder has advised its staff to take annual leave or unpaid leave until the ACCC makes its decision. Some staff promised redundancy fear they will not be paid, according to Australian Financial Review.