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In the Media

article imageReport: Pepsi eyes 4,000 layoffs, end to 401(k) to boost profits

article:317342:15::0
By Andrew Moran
Jan 5, 2012 in Business
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New York - In order to boost the company's earnings, Pepsi is looking at cutting about 4,000 jobs from its workforce. It is also eyeing the possibility of ending or reducing pension contributions. A "final decision" is expected in a few days.
According to an exclusive report from the New York Post, PepsiCo is considering the possibility of laying off about one percent of its employees, which amounts to roughly 4,000 jobs from its 300,000 global workforce.
Its headquarters in Purchase, New York could see “modest” job cuts. However, the company may instead think about freezing salary hikes as a way to cut costs, but sources say that it is less likely than the other scenarios.
It was reported last month that Pepsi was looking at axing 1,000 jobs.
It is also looking at either eliminating or reducing its pension contributions to 401(k) retirement savings accounts. Pepsi says its pension plan is more generous than its competitors. If abolished, it would save Pepsi approximately $75 million.
All of these measures are being discussed in order to increase the company’s profits. Sources close to the situation tell the New York paper that a final decision could be made in days. One source said Pepsi is “burning the furniture.”
A PepsiCo spokesperson told Just-Drinks that the media reports are not accurate.
“Like all companies are doing in today’s environment and as we’ve said since the bottler integration and during our ongoing business review, we are evaluating efficiencies in all areas of our operations - including employment levels and benefits,” said the spokesperson.
This story comes as Pepsi faces a lawsuit in which a man alleges that he found a mouse in his can of Mountain Dew back in November of 2009. The company denied the claim and said it was impossible to have a mouse inside of a sealed can.
Indra Nooyi first joined PepsiCo in 1994 and was named president and CFO seven years later. In 2007, she became the CEO. Reports note that in 2008, Nooyi earned a little less than $15 million.
Digital Journal sought comment from Pepsi, but there has been no response as of yet.
article:317342:15::0
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