Nestle cancels leaves over Maggi recall

Company said to be not okaying employees' leaves, because of the huge recall process

The countrywide recall of Maggi might stretch up to eight weeks and Nestle India is not okaying leaves for employees unless there is emergency, a company source said.

Even those employees who had been granted leave have been told to stay. The Indian operation of the Swiss food group employs more than 5,000 people.

Nestle India, which announced the recall of Maggi noodles after states reported dangerous levels of monosodium glutamate (MSG) and lead in samples, did not reply to an e-mail questionnaire on whether the company was permitting leave now.

Soon after Nestle India announced its recall, the Food Safety and Standards Authority of India (FSSAI) told the company to stop production of noodles. The regulator on Monday also sought inspection of all brands of noodles and pasta.

The recall of food products involves removing packs from neighbourhood stores, eateries and retail outlets. Then the packs have to be labelled as recalled. These cannot be brought back into circulation unless cleared by the FSSAI.

Experts said the recalled Maggi products were likely to be destroyed by Nestle. There would be no waiting for the FSSAI's view. "It is an easier and less expensive option to destroy the packs than distribute them later if a clearance comes,'' a consultant pointed out.            

The process is complex because the retail sector in India is mostly unorganised, said Arvind Singhal, founder, Technopak, a consultancy. Had such a recall been ordered in the US, where 80 to 85 per cent of the retail sector was organised, the process would have been completed overnight, he added.

There are around six million neighbourhood stores and at least 300,000 small-scale eateries in the country. Also, the company must deal with distributors and sub-distributors.

A lot of Maggi noodles will still remain in the market because consumers may not be able to return them. Also, eateries lining highways, which continue to see brisk sales of Maggi noodles, are stocking the product because of demand.

In 2014, an estimated 250,000 tonnes of Maggi products were sold in India. Nestle India's revenue from Maggi noodles is around Rs 2,500 crore a year. The instant noodles make up 31.5 per cent of Nestle India's revenue.

Maggi commands around an 80 per cent share of India's noodles market in terms of revenue.