Kenya Airways sacks 80 employees in phase 1 of retrenchment
National carrier Kenya airways (KQ) has sent home close to 80 employees in the first phase of its staff rationalization program.
The airline in March announced it planned to sack 600 employees, a move expected to cut its wage bill by as much as Sh2 billion. The employees will be drawn from various departments with others being redeployed within the airline.
The exercise was scheduled to start in May, but a delay in funding to the tune of Sh10 billion from the Africa Export Import Bank pumped the brakes on the process. The airline has also been locked in lengthy negotiations with workers unions to ensure the smooth flow of the process.
“Today, we will commence with the first phase of redundancies which will impact approximately 80 staff members,” the airline said in a statement.
According to Kenya Airways Chief Executive Mbuvi Ngunze, the exercise fits within the airline’s recovery program that has also seen the reduction of the fleet size and improving productivity of staff.
“During this period we have stress-tested the accuracy of our right-sizing estimates in order to ensure that we have identified all possible ways to retain staff as well as securing the airlines long term operational efficiency,” Mr Ngunze said.
The carrier has a workforce of approximately 4,000 employees, with a wage bill of Sh16.9 billion at the end of March 2015.
Kenya Airways announced its biggest ever loss in 2015 of Sh25 billion and has since been looking for ways to turnaround the business. This saw the appointment of U.S consultancy firm McKinsey to draw up the restructuring plan dubbed ‘operation pride’ expected to save the airline Sh20 billion.
The airline has committed to offer assistance to the affected staff for the next two weeks.
Kenya Airways has been operating on a negative equity position of Sh33.9 billion, further putting a strain on its operations. Last year the airline announced that it had been forced to take debt to pay its workers.
KQ announced a half year loss of Sh11.9 billion and is expected to announce its full year results at the end of July.