U.S.: Sysco to pay US$19.4M settlement over unrefrigerated food sheds
North American Foodservice provider Sysco Corporation (NYSE:SYY) has agreed to settle all claims with the State of California relating to past use of drop sites in the state, for a price tag of US$19.4 million.
Photo: Don Buciak, via Flickr Creative Commons
In July 2013, an NBC investigation revealed the company was using 14 outdoor, unrefrigerated sheds across Northern California to store perishable items including produce, meat and dairy products.
The agreed payment includes US$15 million in penalties, US$3.3 million to fund four California Department of Public Health (CDPH) investigator positions for five years, a US$1 million donation to food banks across California and US$127,000 in costs.
In a statement, Sysco chief executive officer Bill DeLaney said food safety was the company's number one priority and it could not be compromised.
"We sincerely regret that some of our California companies failed to adhere to our long-standing policies related to drop sites," he said.
"The California Department of Public Health and the county district attorneys received our full cooperation in their investigations of our practices."
DeLaney emphasized that in addition to the settlements with the state, the company had comprehensively implemented a range of food safety and quality assurance practices in California, as well as across the Sysco enterprise.
"First, as we stated in September 2013, we eliminated the use of drop sites across Sysco. Second, we have introduced mandatory, annual food safety training for all employees across Sysco," he said.
"Third, we are implementing additional and improved food safety reporting, monitoring and compliance controls across our operations to ensure adherence to our policies.
"Taking these steps reflects Sysco's commitment to food safety across our enterprise. We accept responsibility for the breakdown in our system in California, and we have taken this opportunity to improve our practices and to re-emphasize to our customers and our employees that food safety is our No. 1 priority."
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