PepsiCo to shutter Chicago bottling plant, laying off more than 100 workers

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Dive Brief:

• PepsiCo is closing a Chicago bottling plant that “has physical limitations,” the company said in an email to Food Dive. Teamsters Local 727, the union group representing the plant’s workers, said more than 100 people would be impacted.
• The beverage maker said the decision to close the 60-year-old facility was “a difficult one.” PepsiCo added that the move meets “applicable legal requirements and we will actively work with Union leadership on the details related to the closure.” PepsiCo plans to pay workers for the next 60 days even though they won’t be required to work, according to various media reports.
• Teamsters Local 727 said it was notified of the immediate closure at 5:45 am on Monday from PepsiCo. The union said the New York company violated federal law that requires employers with 75 or more full-time employees to provide 60 days advance notice of pending plant closures or mass layoffs. 

Dive Insight:

PepsiCo and other food and beverage manufacturers have been closing facilities and opening or expanding existing plants to right-size production and improve efficiencies across their manufacturing networks. In some cases, retrofitting the plant with new equipment, or making it more environmentally friendly, would be too expensive. 

The union sharply criticized how PepsiCo handled the bottling plant closure. “To lay off over a hundred Teamsters workers with no notice to them or the Union, in violation of both our collective bargaining agreement and the law, is about as low as you can get,” John Coli, Jr, secretary-treasurer of Teamsters Local 727, said in a statement. “Our members aren’t stupid—they see the news. Pepsi is making money hand over fist.”

PepsiCo is constructing a 1.2 million-square-foot manufacturing facility in Colorado, that will be its largest plant in the U.S. The facility is reportedly behind schedule. Earlier this year, PepsiCo announced it was permanently closing a Danville, Illinois, Quaker Oats plant that was temporarily shuttered after products it made were recalled due to Salmonella contamination.