Woolworths warehouse automation set to eliminate 700 jobs in Sydney and Melbourne.

Extract from ABC News

By business reporter Michael Janda

Posted Yesterday, updated Yesterday

Woolworths says there will be at least 26,000 fewer truck movements a year through Sydney because the new centre will have a rail connection.(Supplied: Woolworths)

Around 700 jobs will be lost as Woolworths automates key logistics facilities in Sydney and Melbourne.

Key points:

• Woolworths will close three warehouses with a total of 1,350 staff, redeploying some workers to 650 new roles at Moorebank
• The company is investing up to $780 million in the fit-out and technology of new centres
• Woolworths says the new facilities will allow faster restocking and provide a wider range for customers

There are currently about 1,350 people employed at warehouses in Minchinbury and Yennora in Sydney, and Mulgrave in Melbourne. All three centres will be closed in 2025.

Woolworths said that less than half those workers — just 650 staff — would be needed to run its new automated and semi-automated distribution centres, which would be located in the south-west Sydney suburb of Moorebank.

However, Woolworths will retain its current temperature-controlled operations at Minchinbury, which will continue to employ about 460 people. The new Moorebank centres will be owned by Qube logistics and initially leased by Woolworths for 20 years.

Woolworths is planning to invest $700-780 million in the technology and fit-out of the new distribution centres, while Qube will invest between $420-460 million to build them.

The centres are targeting a five-star green rating with the inclusion of solar panels, LED lighting and rainwater harvesting.

Woolworths said the construction phase would employ about 1,000 people.

'Fewer trucks, faster restocking'

It is connected by rail to Port Botany, and Woolworths said it will mean at least 26,000 fewer truck movements per year on Sydney's roads.

Woolworths already has an automated distribution centre operating in Melbourne.(Supplied: Woolworths)

Woolworths chief supply chain officer Paul Graham said the company had seen the benefits of the new, automated Melbourne South Regional Distribution Centre and was looking to build on those in New South Wales.

"Cutting-edge automation will build tailored pallets for specific aisles in individual stores, helping us improve on-shelf product availability with faster restocking, reducing congestion in stores, and enabling a safer work environment for our teams with less manual handling," he said in a statement.

"The new facilities will also help progress our localised ranging efforts, with the ability to hold many thousands more products centrally than we can in our existing facilities." Mr Graham said Woolworths would look to employ as many existing staff as possible in its new Moorebank facilities.

"We'll look to offer redeployment opportunities wherever possible with 650 roles available at the new Moorebank sites, as well as providing a wide range of support and career transition services to our team well before site closures," he said.

However, Woolworths has set aside $176 million to cover potential redundancy costs for existing staff.

The new distribution centres remain subject to New South Wales government planning approval.

Union calls decision 'heartless' after worker's efforts during pandemic

The union body has slammed the announcement, saying big corporations should focus on up-skilling their current workforce.

"The announcement by Woolworths to replace our members' jobs with robots is particularly heartless given the back-breaking work our members did to support Woolworths through COVID and make them massive profits," Matt Toner from the United Workers Union said.

"Today's announcement is terrible and disappointing news and we stand in solidarity with members."

Mr Toner said Woolworths and Coles should be more focused on training their current workforce rather than finding cost-cutting measures.

"Big companies can't keep irresponsibly hollowing out good jobs and good wages and conditions," he said.

"Woolworths and Coles should pay to up-skill and train their existing warehouse workers in the jobs of the future rather than hiring new workers.

"Future jobs must maintain dignity in wages and conditions."