• Settles with NAFDAC, pays N11.4m fine
Guinness Nigeria Plc in response to the prevailing economic challenges in the country will be embarking on a round of staff rationalisation which will see a significant number of employees declared redundant and disengaged from the company.
THISDAY investigation revealed that not less than 100 employees from all segments of the business will have their employments terminated as the company grapples with the unrelenting foreign exchange crisis and tries to keep pace with competition.
Confirming the story yesterday, the Corporate Services Director of the beer and beverage makers, Mr. Sesan Sobowale, noted that the restructuring which the company is embarking upon will look at all the cost components of the business, including head counting and ultimately result in some job losses.
He, however, noted that it had not been determined yet the extent and the number of persons that would be affected by the exercise.
Sobowale, who said that the company would be release an official statement on the issue today, stated: “ We are reviewing the organisational structure of the business and looking at all the cost components in order to cut cost in view of the prevailing economic condition the country and the foreign exchange challenge.
“Purchasing power in the country is low, we are not willing to raise prices and people are drinking cheaper brands. So there will be head counting and we do not know yet how many people will be affected.”
In another development, the company confirmed the resolution of its dispute with the National Agency for Food and Drug Administration and Control (NAFDAC), which began in November 2015 when the agency slammed a N1billion fine on the company.
NAFDAC imposed the fine on Guinness for allegedly re-validating expired raw materials without approval, maintaining poor documentation and failure to comply with some of its regulations.
It explained the fine as “administrative charges for various clandestine violations of NAFDAC rules, regulations and enactments over a long period of time.”
Guinness was given a two-week ultimatum to pay the fine, but the company immediately said it was in talks with NAFDAC over the sanction, and denied flouting the rules of the regulatory agency.
“As a responsible corporate organisation, we take these allegations which relate primarily to raw materials stored in one of our raw materials stores very seriously,” Peter Ndegwa, Managing Director of Guinness Nigeria Plc, said back then.
“We are engaging NAFDAC for clarifications and resolution of the issues… The management of Guinness Nigeria does not fully understand the basis for the computation of the administrative charges nor the particular regulations alleged to have been infringed.”
The following month, Guinness instituted lawsuit against NAFDAC at a Lagos High Court in Igbosere through its lawyer, Olasupo Shasore (SAN), claiming that the agency did not afford it the opportunity of fair hearing on the allegations that prompted the controversial fine.
Shasore also prayed the court to perpetually bar NAFDAC from publicly discussing, analysing or providing any information to the media, whether print, electronic or in any other manner, to suggest that the decision to sanction it was lawful.
However, Guinness according to an online news portal, The Cable, in a statement confirmed that all that had been confined to the past.
“Guinness Nigeria can now confirm that a notice of discontinuance of the court action instituted against NAFDAC and the Attorney General of the Federation has been filed,” read the statement released by its corporate communications department.
“The action was started following the receipt by the company of a letter dated November 9, 2015 from NAFDAC which, among others, imposed administrative charges of one billion naira (N1billion) on the company.
“The termination of the court action was predicated on the letter dated February 15, 2016 from NAFDAC to the company which was stated to ‘supersede the decisions contained in the Agency’s letter dated November 9, 2015.”
“As part of the resolution, NAFDAC would be present during the destruction of the expired raw materials in its rented warehouse and both parties agreed that this would be the procedure for the exercise in future.”
Guinness also said it had “agreed to pay administrative and service charges to NAFDAC to cover the cost of the investigative inspection of raw materials carried out by the Agency as well as the supervision by NAFDAC of the destruction of the raw materials which would be carried out by Guinness Nigeria.
“The administrative and service charges of approximately N11.4million has since been paid to NAFDAC,” it said, expressing gratitude for “the support received from the Minister of Health and from the former Director-General and senior management of NAFDAC towards the amicable resolution of the matter and expresses its commitment to maintaining and fostering a strong and mutually beneficial relationship with NAFDAC.”
Guinness Nigeria, which has been operating in Nigeria since 1962, is part of the Diageo group of companies.