Retailers and suppliers in the UK food processing industry

Caroline Lloyd

ESRC centre on Skills, Knowledge and Organisational Performance (SKOPE)

School of Social ScienceCardiff University

Email: lloydc4@cardiff.ac.uk

Supply chain pressures

Beaumont et al. (1996)

Direct: imposed by customer, e.g. company audits, minimum standards, inspections etc.

Indirect: changing customer demands impacts on suppliers, e.g. JIT, quality standards, cutting costs.

Food processing sector

Top 10 retailers 85% of sales & ‘Big Four’ – Tesco, Sainsburys, Asda and Morrisons – 62% of grocery sales

Increase in migrant workers & agency (Defra estimates 150,000 agency workers filling 40,000 jobs – 90% from overseas)

Low pay: 20% earn < £6 ph (20% earn > £10 ph) in 2008

Long hours (20% of men work > 48 hours/week)

Predominantly low skilled, over 1/2 no qualifications/level 1

High levels of repetitive movements, short-cycle times

Health and Safety Record

Injury rate/100,000 worker (2006/07):

manufacturing = 925food and drink = 1526

Food & drink : rate dropped by 45% since 1990

Source: HSE

Meat & poultry products (1409/100,000)

Main causes of injury Being struck by hand tools including knives Manual handling and lifting - especially lifting heavy and awkward

loads Slips - mostly due to wet or greasy floors

Main occupational ill health risks

Musculoskeletal injury from manual handling Work-related upper limb disorders from repetitive work Noise induced hearing loss from noisy areas

Source: HSE

M1 M2 M3

Plant direct employment 500-750 500-750 100-150

Agency workers up to 150 up to 100 up to 70

% female 33% (2 plants) 37% 10%

% retailer own label 95% (2 supermarkets)

100% (2 supermarkets)

80% (1 supermarket)

Profit margins last six years Less than 3% Around 1% Loss to less than 1%

Approximate union membership

42% (two plants) 40% 50% (includes agency workers)

Management commitment Considerable Some Little

Unions Embedded Fragmented/ weak Active individual

Accidents (relative) Few Some Many

Job rotation Systematic Systematic Limited

Key characteristics of case study plants

H & S outcomes

AccidentsM1 - rare M2 – infrequent, eg. slipsM3 – frequent eg. cuts, scalds, electrocution

All plants: occupational ill health Muscle injuries Back/ neck/ arms Mental health issues Bronchitis Wrist problems Shoulder

Supply chain: direct

Over-riding concern with food hygiene

Audits & some supermarkets do spot checks

Pressure to be within industry norms

Better food hygiene can improve h&s

Supply chain: indirecti) cost pressures

we are very cost focused because they keep squeezing us so we’ve got to keep managing cost within the operation to be able to give them the prices they want but still make a living for ourselves (HRM manager M1).

my job as well as the rest of the guys’ jobs is how do we do it better in the factory to then compensate for the fact that the retailers continue to put the thumb screws on to drive the prices that we sell the product to them down. (General Manager, M2)

Outcomes

And it’s a lot faster moving… I think they are under a lot more pressure in the factory, you know, probably lines have been turned up that little bit and they’ve been expected to work a lot harder, or a lot faster (HR Officer M2)

It’s more products coming through… whereas before we were killing 800 a day to 1,000 a day, we kill up to 1,200, 1,300 a day. So. And no extra money. People are shattered… we are getting lots of problems (union shop steward, M3).

Supply chain: indirectii) Delivery pressures

One of the problems we have in this business is it’s, not only is it seasonal, but it can fluctuate by 100% from day to day because the sales figures that you get are terrible. … And that’s where we have struggled, we struggle to manage overtime… we have to say to people at ten o’clock at night “Do you mind staying on till two o’clock in the morning to help process these products that will need to be on a lorry at seven”. That’s the problem we are in, it’s the supermarkets that are driving this business. (Factory Manager, M2)

[agency workers] ‘it’s just an easy turn on of the tap’. (Production manager, M1)

Impact on h&s

‘there are minor things which could be dealt with in five minutes and yet it doesn’t happen… I think like most factories getting the product out of the door is the most important thing and everything else is secondary’ (shop steward, M2)

‘it seems to me that’s a price they are willing to pay to get that extra production… I think, you know, that health and safety has been sacrificed for the need to actually produce more’ (Union regional officer, M3)

Impact on h&s: agency workers

‘he [young Polish trainee] said I go on holiday tomorrow, what’s the point of me going in there [where they cut the backbone out] for 1 or 2 hours and the supervisor say ‘get your backside in there, you do it’, pressure and pressure and he took his finger straight off within five minutes of doing the job… So that’s what we call training’ (Shop steward, M3)

‘A foreign boy… about six months ago and he admitted it was his own fault because he was told not to push the minis [fillets] and he did and he injected straight in his finger, very painful, 3 weeks of work’ (operative trainer, M2)

Management and unions: room for manoeuvre?

Entrenched unions + commitment from management (M1)‘you go to your union rep and say ‘look’, or when they walk through the department and you say I’ve got a problem, such and such and he will get in touch with the health and safety bloke [rep]… and he we say right sorted it and it is sorted’ (Operative M1)

Weak unions + some commitment from management (M2)they [management] told me I’d close the factory down if I continued the way I was doing but I said I’m not apologising for doing the job right… I am sure they would like to get rid of me. (Union rep, M2 after calling the HSE)

Active individual union rep + low commitment management (M3)‘We have improved health and safety over the last few years by 70% I reckon. We’ve stopped a lot of cuts, major cuts, arteries. Because we’ve now got, we brought in chain mail gloves, what you call a cutter’s sleeve which is if your knife slips it doesn’t cut it’ (Union rep, M3)

Conclusions

Direct pressures can have a positive impactDirect pressures can have a positive impact

Indirect – hindrance to h&sIndirect – hindrance to h&s

Unions and/or management can make a Unions and/or management can make a difference even where pressures are intensedifference even where pressures are intense

Can supply chains be used to improve h&s?Can supply chains be used to improve h&s?