Woolworths to slash 1,300 jobs in pivot to automation

The closure of warehouses will render workers in Sydney and Melbourne redundant

Woolworths to slash 1,300 jobs in pivot to automation

Woolworths is set to eliminate 1,350 jobs across its warehouses in Sydney and Melbourne as the supermarket chain pivots towards automated distribution centres.

The company said it is investing up to $780m into two new facilities at the Moorebank Logistics Park in Sydney. The automated centres will replace operations across three sites that handle national and regional distribution, but they will require only 650 workers once they are completed in three years.

The closure of existing warehouses will render more than 1,000 workers in Sydney and about 300 in Melbourne redundant by 2025.

Read more: Woolworths admits underpaying staff up to $300M

Promising support for affected employees, Woolworths CEO Brad Banducci said: “It will be a number of years until the closure of our existing facilities.”

This will give the company a chance “to explore meaningful redeployment opportunities for our team,” he said. But the company will still need to pay other workers $176m upon retrenchment.

The pivot towards automation will also require employees to have specialised digital skills. 

Banducci said Woolworths is “committed to a long-term investment in supporting all of our teams with the skills and training required for the workforce of tomorrow.”

During the early weeks of the COVID-19 lockdown, Woolworths weathered the increased demand for consumer goods by hiring tens of thousands of additional workers within just a few weeks.

Read more: Aussie companies hiring thousands despite economic slowdown

But with the public health crisis still looming, businesses like Woolworths are also starting to consider options, such as automation, to keep logistics running while fending off interruptions to the supply chain and threats to workplace health and safety.

“Cutting-edge automation will build tailored pallets for specific aisles in individual stores – helping us improve on-shelf product availability with faster restocking, reducing congestion in stores, and enabling a safer work environment for our teams with less manual handling,” said Paul Graham, the company’s chief supply chain officer.

Woolworths announced its plan to automate facilities and downsize the workforce amid its preparations to remunerate a group of store employees $390m in backpay.

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