Fire at the bacon processing plant in Princeville: Olymel announces plan to temporarily relocate employees

ST-HYACINTHE, QC, May 14, 2012 /CNW Telbec/ - Olymel l.p. management today announced a plan for the temporary relocation of employees affected by the fire that destroyed its bacon plant at Princeville on May 6. This plan will be implemented in conjunction with the management of five other Olymel facilities within a radius of about 100 kilometres from the Princeville plant, and, with the cooperation of the accredited trade union organizations, was presented today to all employees on forced layoff because of the fire on May 6. While some of the facilities were spared by the disaster, the extent of the damage is such that a resumption of operations in the short-term is not feasible. The cause of the fire is not yet known, and Olymel still awaits damage assessment reports. The management of Olymel is not excluding any scenarios for the future and says it is too early to make a decision as to whether to rebuild the Princeville facility.

TEMPORARY, VOLUNTARY EMPLOYEE RELOCATION MEASURES

In light of this event beyond its control, and until such time as it has all the analyses it needs to decide the fate of the plant, Olymel has announced its decision to take exceptional measures to offer the 180 employees of the Princeville plant to be temporarily relocated to other company-owned facilities, including its facilities in Drummondville (bacon plant) Trois-Rivières (processing), Vallée-Jonction (hog slaughtering, cutting and deboning), Ste-Rosalie (cutting and processing) and St-Hyacinthe (pork ham deboning), all on a voluntary basis.

As early as last week, Olymel placed teams of human resources advisors  in a state of readiness. In the coming weeks, in conjunction with operations managers and the various unions representing workers, they will implement this plan to relocate employees in the best possible conditions. Employees of the bacon processing plant in Princeville who wish to participate in this temporary relocation plan, which should be in effect until September, will be given hiring priority. Employment conditions and provisions of the collective agreements in force in the various facilities will apply to employees who accept this offer. Each employee's qualifications and number of years of service will also be considered. Olymel will also provide transportation services between Princeville and the other facilities, where numbers warrant.

MARKET CONDITIONS IN THE BACON SECTOR

Olymel management considers that, given the size of investment required to rebuild the bacon processing plant in Princeville, it must first conduct an in-depth analysis of market conditions in this sector. According to the Olymel CEO Réjean Nadeau, the bacon market has recently been under considerable pressure, with intense competition in Canada and on foreign markets.

"Lower production costs in the United States have enabled U.S. manufacturers to offer fierce competition for domestic products both in Canada and south of the border. The parity of the Canadian dollar with the U.S. currency also has an impact on our exports. In this context, our analysis should enable us to evaluate the possibility of combining the bacon production which was previously done at Princeville with other operations. It must also consider the possibility of changing the mix of operations at the plant before making a final decision on the fate of our Princeville facility. The situation requires a solid long-term business plan, and we will do everything that needs to be done in the coming weeks," Mr. Nadeau concluded.

Lastly, Olymel wishes to thank the authorities and local communities who, in one way or another, have expressed their solidarity with the company, and especially the 180 affected employees. The employees have been hard hit, not only by the loss of their factory, but also by the forced termination of their employment. Meetings were also held on Thursday, May 10 with all employees to inform them of possible remedies, assist them in their efforts to obtain unemployment benefits and provide them with assistance from the company Support Program.

Olymel also wishes to recognize the dedication of managers and employees who assisted the emergency and fire services during the fire. The company and its executives also salute the extraordinary work done by firefighters from Princeville and surrounding municipalities, municipal services, experts from the Ministry of Environment, Sustainable Development and Parks and Public Security, whose interventions helped protect the surrounding populations and their properties.

ABOUT OLYMEL L.P.

Olymel l.p. is a leader in the slaughtering, processing and distribution of pork and poultry meat products in Canada, with facilities in Québec, Ontario, and Alberta.The company employs near 10,000 persons and exports nearly half its production, mainly to the United States, Japan and Australia, as well as some sixty other countries.Its sales stood at more than $2 billion this year, with a slaughtering and processing capacity of 160,000 hogs and 1.7 million birds a week. The company markets its products mainly under the Olymel, Lafleur and Flamingo brands.

Olymel l.p.:   
Richard Vigneault 
Communications 
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