The Brookside Limited, a dairy processing company that packages long-life milk, cream, butter, yogurt, ghee, and milk powder in Uganda and the East Africa regional export market has retrenched over 50 percent of its staff following a drop in the exported products.
In a letter addressed to the Commissioner of Labour at the Ministry of Gender, Labour and Social Development, Ms Winnie Mirembe Mugabi, the company’s Human Resource and Administration manager cites the Kenya Government’s failure to grant export permits to Brookside Uganda, something that denied the company access to 75 per cent of its market since March 2023, as one of the factors.
“The company has been trying to mitigate the effects of these adverse developments by trying to grow local sales and also source alternative markets for its products in replacement of the blocked Kenyan market. Having worked on these initiatives for the last three months, it is apparent that we are unlikely to realize tangible results from the initiatives in the short run. We have also engaged the relevant authorities in Government to intervene but without any success,” the letter partly reads.
“For us to continue running the factory, we have no choice but to scale down all our operations across the entire value chain to match with our current level of business which is a paltry 25 percent of our normal operational volumes. Under section 81 of the Employment Act, we would like to take this opportunity to inform you of our decision to lawfully terminate employees whose number exceeds 10 on account of structural reasons. 50 percent of our staff will regrettably be affected by way of a retrenchment intended to take effect in July 2023,” the letter adds.
In May 2023, the NRM Vice Chairperson of Eastern Uganda and also the patron of Uganda exporters and clearing Companies revealed that over 80 Milk companies had been denied licenses to export milk to Kenya.
Mukula said that as East Africa, they have an agreement of free trade across the region and it looks like Kenya has continued going against the agreement.
Mukula while addressing the press on the 17th of May 2023 at his offices in Bugolobi told the press that several Milk companies have opted to pull out of business, others are struggling to survive due to the luck of the market and others like Brookside Limited have opted to lay off employees.