Jobs to go in Merck efficiency plan
More than 1,000 jobs to go in Germany representing 10% of the workforce
Merck KGaA is to undertake an efficiency plan for the company’s operations in Germany as part of the company’s ‘Fit for 2018’ business transformation programme spanning all businesses and regions to secure its long-term competitiveness.
Merck plans to eliminate around 1,100 of the 10,900 positions in Germany by the end of 2015.through voluntary redundancy and early retirement. There will be no compulsory job losses until the end of 2017, with the exception of possible site closures and transfers that are still being assessed, the company says.
‘We have had constructive discussions with Works Council members and are happy to say that we now have a roadmap that will position Merck Germany in such a way that the company is prepared for the challenges we will face,’ said Kai Beckmann, member of the Executive Board and responsible for Human Resources. ‘This agreement is a positive development for Merck’s future and a clear commitment to Germany. Now, we need to consistently implement the measures and continue moving ahead with the changes in our company.’
The ‘Fit for 2018’ programme, which calls for production to be focused on core activities that generate high value, was announced at the end of February. The company has already begun implementation of some efficiency programmes outside Germany in recent months, including the move of the headquarters of its pharmaceutical division (Merck Serono) from Geneva to Darmstadt.
The efficiency measures for Germany comprise more than 100 individual initiatives spanning all businesses and functions. Outsourcing functions to external providers are not planned, with the exception of activities that are already partially being outsourced to third-party suppliers, such as routine jobs connected to Regulatory Affairs, or labour-intensive jobs, such as certain blending and filling activities in production. This will affect around 100 jobs.
Some support functions across the divisions, such as logistics, will be reorganised, and in the area of financial services, specifically Merck Shared Services Europe GmbH (MSSE), it has been agreed to jointly leverage efficiencies. Merck will refrain from relocating MSSE abroad at least until the end of 2015. The parties are confident that the defined targets can also be reached at the Darmstadt location.
The production of industrial salts in Lehrte as well as the filling operations in Hohenbrunn will be discontinued. A total of approximately 140 employees are working at the two sites.
To strengthen the Darmstadt site within the framework of the ‘Fit for 2018’ programme, Merck also plans to invest at least €250m at this location and other sites within Germany over the next two years.
As the global headquarters of the Merck Group, the Darmstadt site will be expanded further and will become an r&d centre of excellence, with a tightly networked research and knowledge platform for both pharmaceuticals and chemicals.
A modern and up-to-date working environment, flexible organisational structures, and suitable workspaces in research and development should be able to drive innovation, retain talents and attract skilled professionals, the company says.