Monsanto cutting 16% of workforce as part of restructuring efforts
As part of its restructuring and cost savings plan announced in October, Monsanto will cut 1,000 jobs across a range of functions and global locations, says a recent regulatory filing from the company. Combined with the 2,600 jobs that the group announced it was cutting this past autumn, these new cuts will bring the total workforce reduction to 16%.
In the short term, these cuts, plus the additional lay-offs will increase the company restructuring costs.
“Every employee whose job has been eliminated received a competitive severance package, including a lump sum cash payment ranging from 6 to 15 months of eligible pay based on years of service as well as base pay and average annual incentives paid,” a company spokeswoman told the St. Louis Business Journal. Employees will also receive job transition services. These severance packages and the costs incurred from closing facilities will now cost the group as much as $1.2 billion. Of this total, $493 million was incurred in the fourth quarter of 2015, and $318 million in the first quarter of 2016, according to company officials.
In the long term, these cuts are being called for to make the group more efficient through the streamlining of its commercial and research development initiatives, saving the company between $275 million and $300 million per year by the end of fiscal year 2017. Under its restructuring plan, the group is also seeking to divest itself of its sugar cane business.