Intel's cost-cutting is "short-term measure" - says minister

Intel has offered voluntary unpaid time off to a large portion of its Irish workforce in a bid to cuts costs - but a Government minister has said he believes it's a short-term measure.

Workers in the manufacturing area at the company's Leixlip campus have been asked to take three months leave without salary before returning again.

It's thought that thousands of staff may have been presented with the option.

Intel said in a statement: "Retaining our manufacturing talent is a key element of positioning Intel for long-term growth.

"Voluntary time off programs allow us an opportunity to reduce short term costs and offer employees attractive time off options.

"Manufacturing talent represents an important element of our business here in Ireland."

Last month the company told investors it was planning cost cutting measures, including redundancies, amid a slowdown in demand for technology.

However Minister for Foreign Affairs Simon Coveney said that a senior Intel executive assured him of the company's commitment to Ireland during a recent visit to Washington.

Speaking on RTÉ's Morning Ireland programme, Mr Coveney said that the Government believe that Intel's cost-cutting is a "short-term measure".

"Since Intel arrived in 1989 they’ve spent over €30 billion in Ireland and that’s an investment in the long-term.

"They’ve announced internationally that they have to cut costs, we expect that that’s a short-term measure, and I know that their commitment to Ireland, having heard it from them, is very, very strong," Mr Coveney said.

"The IDA is working with them on a daily and weekly basis, and of course the State has to be there to protect employment in Ireland – particularly with such a large employer," he added.

Fianna Fáil Kildare North TD James Lawless reiterated on the RTE programme that the cost-cutting measures in Leixlip are a result of a global slowdown in demand.

He said that despite this "the direction of travel" remains positive because there was a €12bn commitment to the plant in March and there were 1,600 new jobs created there.

Social Democrats co-leader Catherine Murphy has said the decision by Intel was not unexpected as she was aware that there would be some "significant savings" that would be sought by the company.

Speaking on the same programme, the Kildare North TD said she said that she is "a bit surprised" that large scale voluntary time off is being offered.

"Obviously that is an effort to try and retain as many people as possible ... and it's a very talented workforce," she added.

She said there is a concern that if enough people do not take the lay-off for three months what that would mean for all staff as she acknowledged that there is a worry about redundancies in the short-term.