Heinz to pay tomato growers $1.8M for Leamington closure
Ontario Processing Vegetable Growers calls agreement 'extremely fair'
H.J. Heinz Co. has agreed to compensate tomato growers who for years had supplied their fruit to the Leamington plant scheduled to close in June of this year.
"In recognition of the long standing partnership and mutual respect between our company and all 43 local tomato growers in the Leamington area, Heinz is pleased to confirm that the growers have unanimously accepted a goodwill payment by Heinz," company spokesperson Michael Mullen said in an email to CBC News. "Although the terms of the contract required no payment, Heinz felt that a goodwill payment would help offset costs incurred by some growers who had already begun to prepare for next year’s tomato crop.”
John Mumford, general manager of the Ontario Processing Vegetable Growers, said the agreement calls for Heinz to pay 43 farmers a combined $1.8 million.
Mumford said all 43 growers have approved the agreement.
"It’s an extremely fair settlement and growers seem pleased with it," Mumford said.
Mumford said growers supplied Heinz with 200,000 tons of tomatoes every year.
"There’s still hope in the grower community that there will be some of that [saved by] existing processors," Mumford said. "There may be some replacement volume contracted in 2014."
Mumford said that won't be known until April.
Earlier this month, Heinz and the United Commercial Food Workers Union reached a closure agreement at the Leamington plant.
The plant will officially close June 27.
Unionized employees who will be out of work will get two weeks pay for every year worked, a $2,500 productivity bonus and 52 weeks of healthcare benefits.
Days after the closure was announced, the Ontario government committed $200,000 to assisting the nearly 800 people who will be out of work.
Mumford said his board has also asked the Ministry of Agriculture to assist the tomato growers. He expects to hear back from the ministry in early February.