A tobacco company will stop giving staff free cigarettes and will donate $5000 to charity following court action by the Ministry of Health.
More than 100 Imperial Tobacco staff at its Petone factory were given free cigarettes over a number of years to test while at work.
The ministry prosecuted the company in May under the Smoke-free Environments Act 1990.
As of January, the ministry understood about 1500 cigarettes were made available each day to 141 staff as part of its testing programme.
The ministry confirmed today that it had reached a settlement with Imperial Tobacco. The charges were withdrawn as a result.
The company agreed to stop the testing programme and to donate $5000 to a charity of its choice - but one approved by the ministry.
Imperial Tobacco was facing a maximum fine of $50,000 for distributing or supplying free tobacco products.
The ministry's chief legal adviser Phil Knipe said in a statement the result was a ''good one''.
"We have stopped the practice and have received acknowledgement from Imperial that they were in breach. We also have agreement that this type of arrangement will not be resumed."
Hutt Valley District Health Board staff will monitor the company's compliance with the agreement and the law.
A Imperial Tobacco spokesperson said the firm will comment on the settlement later today.
The factory has been at its Richmond St site since 1929. A $45 million factory upgrade was completed last August that enabled it to triple exports to Australia to 3 billion cigarettes a year.
After the upgrade, staff numbers increased by 50 to about 200, producing 3.9 billion cigarettes and 800 tonnes of rolling tobacco each year.
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