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Tim Hortons confirmed Tuesday afternoon it has let an undisclosed number of office workers go as the new owners of the iconic coffee chain begin to implement changes aimed at boosting profits.
“We have had to make some difficult but necessary decisions today as we reorganize our company to position ourselves for the significant growth and opportunities ahead of us,” Alexandra Cygal, vice president of corporate affairs, said in an emailed statement.
MORE: Tim Hortons nears layoff notices for hundreds of office workers, report says
The decision comes roughly six weeks after 3G Capital, a Brazil-based investment company that also owns Burger King, merged Tim Hortons with the U.S. fast-food chain to create the new Restaurant Brands International.
A published report from late last week indicated hundreds of office workers across seven regional offices and Tim Hortons headquarters in Oakville, Ont would be laid off Tuesday.
“We are confident the new organization will be faster, more efficient and better positioned for continued success,” Cygal said.
She added that departing employees would receive “generous and enhanced severance packages, continuing health benefits and outplacement services.”
Tim Hortons doesn’t directly employ the tens of thousands of full- and part-time staff members at the 3,600 or so franchisee-owned locations across Canada. But it does directly employ 2,150 people spread across its headquarters, five distribution centres and seven regional offices.
About 1,400 of those behind-the-scenes workers were employed at Tims headquarters or regional offices before Tuesday’s cuts. A spokesperson declined to specify how many people were fired.
‘The risk they’re running is, if you cut this fast and deep you can break the back of the culture’
Tims distribution centres are located in Guelph, Ont., Kingston, Ont., Langley, B.C., Calgary and Debert, Nova Scotia. Another facility is owned in Vaudreuil Dorion, Que., according to regulatory filings. There are three manufacturing facilities as well, based in Hamilton, Oakville and Rochester, New York.
As part of 3G’s successful acquisition of Tim Hortons, it agreed to “maintain significant employment levels” at Tim Hortons’ existing Ontario headquarters, according to a statement from Industry Canada.
The federal department approved the $12.5 billion blockbuster deal on Dec. 4.
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Experts suggest employees from Burger King’s headquarters in Miami and 3G’s offices in New York will be moved into Tim Hortons’ headquarters, which will serve as the combined company’s global HQ.
“They put something in [the agreement with Ottawa] about substantive levels of employment, which they could still argue because realistically, if you look at the combined entity the Canadian offices are still bigger,” an analyst source with close ties to Tim Hortons said.
3G comes with a reputation for dramatically slashing budgets and head count at companies it gains control of. About 450 middle managers and higher-ups were fired from Burger King when it was acquired by 3G in 2010.
More recently, Heinz dumped 3,400 positions across the food processing company when it was acquired by the New York and Rio-based investment fund in February 2013.
“These guys will play the letter of the law, not the spirit,” the analyst said. “The risk they’re running is, if you cut this fast and deep you can break the back of the culture.”