Nearly 400 jobs are at risk at Rathbones Bakery in Wakefield after its owner, Morrisons, announced it is considering closing the site.

Morrisons acquired the Rathbones Bakery manufacturing facility out of administration in 2005. Despite a period of growth and investment, the site has been operating at a loss for several years. Recent accounts filed with Companies House show a loss after tax of £2.2 million for the 52 weeks ending 29 October 2023, following an exceptional impairment charge of £4.5 million. This compares to a loss of £1.4 million in 2022.

“Although we have tried several routes to return the business to profitability, none have been successful,” a Morrisons spokesperson said.

Over the last few months it has conducted a “thorough review” of its options for the future of Rathbones. “This has led us to consider the possibility of closing the site,” the spokesperson added.

“However, we are considering all alternative options, and want to work with our partner union BFAWU, together with employee representatives, on how we could change our current business model and safeguard as many jobs as possible.”

Morrisons has confirmed that the current proposals place colleagues at the site at risk of redundancy. However, the company stated it would do “everything we can to help those colleagues affected, including investigating whether there are any other suitable roles elsewhere in the Group.”

Rathbones manufactures nearly 50 different products for the supermarket, including hot cross buns, seeded loaves, crumpets, pancakes, naan bread, and pittas.

The 497 in-store Market Street bakeries will not be affected by the proposals, according to a spokesperson. The retailer follows a scratch baking model, producing bread, rolls, and doughnuts fresh from scratch at nearly 90% of its in-store bakeries daily.

The Bakers, Food and Allied Workers Union (BFAWU) has reacted angrily to the news, calling the decision “short-sighted.”

“Since Morrisons were bought out by Clayton Dubilier & Rice in 2021 we have seen the traditional cycle of private equity firm behaviour post takeover that throws workers on the scrapheap without even a glance back,” said BFAWU general secretary Sarah Woolley. “They have asset stripped Morrisons, with our members now bearing the brunt of their mismanagement with this short-sighted decision to close the site.”

The BFAWU claims that Morrisons has suggested keeping the morning goods section of the factory open but has raised concerns about the potential impact on employees who would remain at the site.

“We will not accept a de-facto fire and rehire approach by these private equity asset strippers. No trade union worth its salt would accept the stripping away of the terms and conditions and pay that the branch has worked hard over a number of years to negotiate,” Woolley added. “The current settlements were negotiated in good faith and are exactly what our members need – we cannot accept a deterioration that would drive many into ‘in-work’ poverty.”

BFAWU stated that it would continue discussions with the company, as well as local politicians and relevant government ministers, to protect its members and explore alternative employment opportunities for them.