Shanghai Husi announced today it would lay off most of its employees following the rotten food scandal. The Chinese arm of the US food supplier OSI Group made the announcement through its website.

Shanghai Husi has been supplying to fast food chains including Dicos, KFC, McDonald’s and Burger King.

Like Us on Facebook

The rotten food scandal was reported last July by a TV program in Shanghai. The report said Shanghai Husi workers mixed expired meat with fresh products for repackaging. The news has caused a nationwide food scare that even reached Hong Kong and Japan.

The news from the company’s website said it would lay off a total of 340 employees. However, the factory would not completely close as investigations are still being conducted by Chinese officials. The statement said a small number of workers would assist the authorities in conducting the probe.

Workers affected by the furlough would get compensation as stipulated in the country’s worker’s laws and other policies. There would be 226 company-hired employees that would lose their jobs, and 114 others contracted from agencies.

Local authorities probed the matter following the Shanghai TV report. Officials found out that manufacturing dates in some products were forged. They also found out that some products were still sold even beyond their expiration dates.

Authorities have already arrested six Shanghai Husi key officials last month over charges of manufacturing and selling low quality and fake products.

OSI said the company has experienced financial and customer loss in the last two months after the incident was reported. Most of their employees in Shanghai have gone on paid leave, OSI said. The company also said it would be unlikely for the Shanghai factory to resume operations.

Local officials also told top global food chains to name their suppliers in the country over their Chinese website. This would help strengthen the government’s campaign in keeping a close watch on food supplies.

The investigation against Shanghai Husi is still ongoing, said a Shanghai Food and Drug Administration official. There is no telling when the probe would end.

TagsShanghai Husi, OSI Group, KFC, Mcdonalds, burger king, Dicos, Shanghai Food and Drug Administration