KANNAPOLIS — After filing for bankruptcy earlier this month, Product Quest Management LLC will be laying off 296 employees in Cabarrus County during the holiday season, according to a notice filed with the N.C. Department of Commerce.
With permanent employee separations expected to occur between the period of Nov. 5 and Nov. 19, Product Quest will close two of its locations in Kannapolis and Concord.
The company, an over-the-counter manufacturer of health and beauty care products, will lay off 204 manufacturing and operations employees. Seventy-four employees with the “quality” job title and 13 finance and administration employees will also be laid off.
The remaining layoffs will be of sales employees.
The closures are a result of the company filing for bankruptcy with the U.S. Bankruptcy Court for the Middle District of North Carolina, which Product Quest announced Sept. 7.
The company attributed its bankruptcy in part to high costs for improving bad conditions at its Kannapolis facility. Product Quest received a warning from the U.S. Food and Drug Administration after a four-day inspection in October 2017 revealed multiple alleged infractions.
The infractions found by the FDA at Product Quest’s Kannapolis facility included the company’s manufactured human drugs using the same facility and equipment as several pesticides, risking drug contamination. Another infraction alleged that equipment used by the company for drug manufacturing wasn’t sterile.
The company said that in mid-August, its Kannapolis facility lost key customers and was unable to raise sufficient cash.
Problems at Product Quest’s facility in Daytona, Florida, also contributed to the bankruptcy filing. On Aug. 7, the company recalled all nasal products and baby oral gels that were produced at the facility.
The recall stemmed from a finding of microbial contamination in a unit of CVS Health 12 Hour Sinus Relief Nasal made at Product Quest’s Daytona facility.
As of July 30, operations had ceased at the Daytona facility, eventually resulting in 184 workers being laid off.
In March 2015, Product Quest was ordered by the Marin County Superior Court in California to pay over $123,000 in civil penalties after a citizen sued the company for selling sunscreen in California that lacked required health hazard warnings.
Product Quest sent notice of the upcoming layoffs Sept. 6. That notice was in accordance with the Worker Adjustment and Retraining Notification Act, which requires companies to give a 60-day public notice of mass layoffs.
This will be the first mass layoff in Cabarrus County of the year.
According to North Carolina’s 2018 WARN summary, which can be found here, notices have been filed for the layoff of 9,500 employees at this point in the year throughout the state. That already exceeds the state’s WARN notice layoffs number from last year, which totaled 7,591 employees.
This story is from the North Carolina Business News Wire, a service of UNC-Chapel Hill’s School of Media and Journalism
