Despite Potential Job Shifts, Medtronic Says It’s on Track for MN Employment Pledge
Medtronic announced a restructuring plan last week that will result in the elimination of some positions, possibly some in Minnesota. One thing the company says won’t change: The commitment it made to create 1,000 jobs in the state by 2020, approximately five years after shifting its headquarters to Ireland.
When Medtronic acquired Dublin-based Covidien for $50 billion in January of 2015, the company moved its official headquarters there as part of an “inversion” deal that allowed it to avoid paying the US’s higher tax rate on overseas profit — the US has a 35 percent tax rate compared to Ireland’s 12.5 percent. When the move was meant with criticism as being unpatriotic, the company made a pledge to Minnesota Governor Mark Dayton that it would add 1,000 jobs in the state within five year of the completion of the deal.
Spokesperson Fernando Vivanco said Medtronic didn’t yet know the total number of employees that would be impacted by the restructuring plan, but that the company is still on track to make good on their pledge. In September of 2015, the Star Tribune reported that Medtronic had added 300 employees in the state since the completion of the deal. Now, according to Vivanco, that figure stands higher.
“Regarding the company’s commitment to create jobs in Minnesota, we have added more than 500 jobs in Minnesota since the close of the Covidien acquisition and remain on track to adding 1,000 jobs within five years of the acquisition,” he said.
The restructuring plan aims to save the company $3 billion by the end of its 2022 fiscal year. An SEC filing describing it noted expenses associated with “severance and other termination benefits to be incurred at sites around the world during the next five years,” but also said the company expects its overall job count to stay steady.
Vivanco said jobs added so far have been across the company’s sites in the Twin Cities, and been concentrated the IT and engineering departments, as well as in the department dealing with clinical trials. Still, some local employees may be impacted by the changes as the company assesses the best way forward.
“Several factors will influence our overall resourcing impact over the five year period. That includes here in Minnesota,” he said.