Cannabis enterprise CannTrust says it is laying off 140 workers, or about 25 per cent of its workforce, immediately after Well being Canada suspended its license to create cannabis.
The layoffs will be phased involving late October and the finish of 2019.
“This was a tricky choice, but it is crucial that our workforce reflects the existing specifications of our small business,” mentioned CannTrust chairman and interim CEO Robert Marcovitch in a statement. “Reducing the Company’s existing operating costs supports our monetary sustainability, and areas us in the most effective position to totally resume production upon the reinstatement of our licenses.”
The layoffs will save CannTrust about $400,000 in month-to-month money savings, the enterprise says, and will “maximize efficiencies.”
The workers may possibly be rehired, even though, pending irrespective of whether Well being Canada restores CannTrust’s licence.
“We appear forward to rehiring at that time, and when once more delivering higher-top quality, revolutionary goods to each our consumers and sufferers,” Marcovitch mentioned.
CannTrust’s troubles started in July, when Well being Canada located it was developing cannabis in 5 unlicensed rooms in its 12-space Pelham, Ont., facility. Well being Canada later located the company’s second facility in Vaughan, Ont., was non-compliant as nicely.
As a outcome, Well being Canada partially suspended the company’s licence to develop and sell cannabis, and CannTrust destroyed its unauthorized cannabis, fired CEO Peter Aceto, asked chairman Eric Paul to resign, and designed a unique committee to probe the regulation infringements.
The enterprise has considering that grow to be an instance of how a licensed producer can swiftly fall in the burgeoning sector.
CannTrust also announced Friday that it has submitted a detailed remediation program to Well being Canada, which it plans to carry out by the finish of the very first quarter of 2020.
The program specifics the actions CannTrust has taken so far and intends to take to get its licence reinstated.
Well being Canada says in order for that to come about, the enterprise have to develop higher handle more than the movement of cannabis in and out of CannTrust’s facility, recover the unlicenced cannabis that was created, and increase record-maintaining and employees understanding of regulations, amongst other measures.
As component of its program, CannTrust says it is carrying out an “expanded complete internal coaching system,” and has strengthened its governance, accountability and infrastructure.
The enterprise says it will take measures to recover all of its cannabis from distributors and retailers that has not currently been sold.
“CannTrust is confident that its remediation program addresses all of the compliance troubles identified by Well being Canada,” mentioned Marcovitch.
“The Corporation has currently produced substantial progress in this regard, and is committed to finishing all of the remediation actions outlined in the program, with input from Well being Canada as proper. We think that, taken collectively, these actions will establish a powerful compliance culture that will meet regulatory requirements.”