Glaxo warns of redundancies

Magnus Grimond
Tuesday 20 June 1995 23:02
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Glaxo Wellcome yesterday warned of redundancies amongst 1,550 staff working at Wellcome's main UK research and development site at Beckenham, Kent, as it confirmed the site's closure over three years in the most significant rationalisation move since the pounds 9.4bn takeover of the company in March.

Workers leaving the group could pick up payments on a sliding scale from two to six weeks pay for every year of service, worth anything between pounds 23,000 and pounds 27,000 for a typical 35-year old employee with 10 years service. Staff will be offered the best of each of the former company's redundancy terms and those over 50 are also being given the option of early retirement.

The terms, addressed to all 16,000 UK employees, follow a general warning of redundancy to Wellcome staff in early May. Around 1,300 research and development staff will initially be affected by the closure, which stems from a decision by Glaxo Wellcome to centre all its UK research at the recently-opened pounds 700m centre at Stevenage in Hertfordshire.

Development work is to move to former Glaxo sites at Ware, also Hertfordshire, and Greenford, Middlesex, which is to be the new headquarters of the whole group. The former Wellcome marketing and patents department, with 90 staff, is to be integrated with operations at Stockley Park, near Heathrow Airport, and Greenford.

The company said it was not clear what proportion would be made redundant until the selection process for the new operation was complete and how many people opted for relocation.

MSF, the main union at Glaxo Wellcome, described the closure as devasting for the staff and the local community. Paul Talbot, national officer, said: "Evidence shows that up to pounds 102m could go from the local economy due to the lost employee income. The Beckenham site has been valued at around pounds 250m."

But Piers Merchant, the Conservative MP whose constituency covers Beckenham, said he had been "very impressed by the willingness of the company to face up to all its responsibilities" after meeting Glaxo Wellcome chief executive Sir Richard Sykes yesterday. During the meeting, the company had hinted that money might be available for a joint venture with Bromley Council, the local authority, to alleviate the effects of the closure on those likely to be made unemployed by the closure.

A statement from Glaxo Wellcome said the decision followed the merger and "reflects the stated intention of achieving efficiencies, generating synergies and eliminating duplication."

in an industry which is changing at an unprecedented rate." A spokesman said the position would become clearer in two to three months, but the intention was that research staff would leave Beckenham within a year, with development following within two.

Research and development work on drugs like Lamictal, an anti-epilipsy treatment, and Welferon, which acts against hepatitis, was done at Beckenham, but initial research on many of the best sellers, including AZT and Zovirax, was done in the US.

The company said no decision had yet been made about the biotechnology development and manufacturing operations, which employ 160 at Beckenham. Announcements about the fate of other manufacturing sites around the world could be expected in the coming months, the company said, although it added that all existing UK manufacturing sites would continue to have a role to play.

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