On Monday, it will be mostly business as usual at Fremont’s Hormel plant. Employees will return to work at their usual jobs. Hormel’s signature canned-ham product, Spam, will be produced.
But, if all goes according to plan, the plant will no longer belong to Hormel, and its roughly 1,500 employees will be working for WholeStone Farms.
More than three months after Hormel announced that it had agreed to sell its Fremont plant to WholeStone, a pork production operation owned by 220 independent pork producers, the companies are expected to officially close the deal on Dec. 3, said WholeStone CEO Luke Minion.
“On Monday, nothing changes,” Minion told the Tribune on Friday. “They’ll have a different group of owners they work for, a different logo on their helmets and so forth, but in general, the activities and the ongoing operations on Monday are going to be much like they were on Friday.”
With the closing of the deal, WholeStone will enter into an agreement to sell 100 percent of its products to Hormel for a period of three years. The company will also continue to produce Hormel’s value-add products, like Spam, over the next three years.
The plant will eventually transition away from producing Spam, and will focus more on harvesting operations.
In August, Minion told the Tribune that WholeStone intended to offer jobs to all of the plant’s current employees. A vast majority of those employees — “99 percent,” Minion said on Friday — have accepted those offers from WholeStone and will remain on staff.
“Maybe there’s one percent that aren’t (staying on),” he said. “But that’s just life, people in various forms and states of transition. All of the workforce has chosen to stay with WholeStone and we’re really excited about that.”
There will be changes under the new management, however. WholeStone does not offer a pension like Hormel did. But the company says it has offered an improved 401K and increased hourly wages while offering “almost exactly the same” medical, dental and visual benefits.
What remains uncertain is how jobs at the plant could evolve in the next three years, as the plant’s value-add operations are phased out, replaced with new harvesting operations. When asked if that could yield layoffs, Minion said: “it’s our serious intent and my belief that we won’t lay people off, as much as we’ll ask them to transition into different jobs.”
That issue will not surface for another two or three years, Minion said, as operations will continue largely as they have been until those transitions occur.
A representative of the United Food & Commercial Workers Local 293, which represents workers at the plant, did not respond to requests for comment.
WholeStone plans to invest upward of $150 million in improving the plant: working the plant up to a double shift, updating its office space and amenities to set the facility up as the company’s corporate headquarters, increasing its capacity with regard to wastewater treatment, remodeling and renovating the harvest floor and replacing Hormel’s value-add production activities with WholeStone’s harvest activities.
Engineering efforts and construction planning have been “actively worked on” over the past 90 days, and the company intends to start some of those construction efforts in the spring.
Minion added that it was possible that at least some of WholeStone’s 220 independent producer/owners may look to “find ways to raise pigs with those families or those producers in a closer proximity to Fremont.” That could mean seeking partnerships with area farmers and producers.
Beginning on Monday, the company will begin to engage producers who were previously working with Hormel to supply the plant. Those producers will still be delivering pigs as per their usual agreements as of Monday.