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Death by Outsourcing

26 October 2009 News
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Most US consumers could be forgiven for never suspecting that Hershey's chocolate - that most iconic of American confectionery brands - isn't made by Hershey at all.

An excellent recent article (Dark and Bitter) in the American Prospect describes the impact of 100% outsourcing at the company: temporary workers are paid half that of permanent workers, casual workers are supplied by temporary agencies, releasing Hershey from employer responsibility, no job security, no benefits, no union committee, no safety on the job. A casual worker making "Hershey" chocolate was recently crushed to death - but he didn't work for Hershey: "He was hired by the Heads Up Staffing Service to report to warehouse owner Lyons & Sons, which provided him to Cocoa Services, Incorporated, the processor doing business with Hershey."

The CEO responsible for outsourcing 100% of Hershey production, Richard Lenny, came to Hershey from Kraft in 2001. Kraft has also been aggressively outsourcing, casualizing and relocating production - and not only in North America. Kraft is now poised to take over UK-based Cadbury - and financial markets are pleased (see When Investors Buzz, Workers Take Cover).