Telkom Kenya lays off 597 workers

April 24, 2009

, NAIROBI, Kenya, Apr 24 – Telkom Kenya on Friday announced that it would lay off 597 employees with immediate effect.

Telkom Chief Executive Officer Dominque Saint Jean told reporters that they were among the close to 1,000 employees, who had applied for the Voluntary Early Retirement scheme launched last October.

“The company has been able to successfully process 340 applications and the employees have been released over the past few months. Today, I am happy to announce that we are now able to grant the remaining 597 applicants their wish to leave the company without further delay,” he said.

St Jean who termed the exercise ‘right sizing’ added that the sending away of staff had nothing to do with the on-going global financial crisis, but added that this would enable them to be remain competitive.

“The roles within Telkom Kenya are now more clearly defined, more commercially focused and more rewarding as we gear our business to deliver a world class suite of converged communications solutions to our customers in Kenya,” he said.

Telkom becomes the second firm in the telecommunication industry to send its staff home after Zain Kenya, which last month retrenched 141 staff members.

“The scheme aims to enable people to seek other opportunities outside the company if they so wished,” St Jean said, while defending the move.

The development comes barely eight months after the company was re-launched following the acquisition of a 51 percent in the organisation by Paris-based France Telecom, as well as the introduction of its commercial brand ‘Orange’ under which it offers its GSM network unveiled in the market.

St Jean added that Telkom Kenya would spend Sh1.7 billion in the exercise that would see the ex-workers paid an average of Sh1.7million; in a package that includes severance pay, transport allowance and a Sh150,000 handshake.

Extensive consultations, he revealed, had over the past few months been held with the Communication Workers Union of Kenya, which was asking for almost double the amount that the company had granted.

He however sought to assure that Telkom had followed the Labour Laws in order ‘to respect its employees wishes and give them what they had requested’.
After the retrenchment exercise, Telkom will be left with 2400 employees, and the CEO did not rule out the laying off of more staff in the future.

“We do not anticipate any downsizing in the near future but the right sizing will be relative to the conditions, where we will evaluate our position against that of the effect of the (global financial) crisis,” he maintained.

The company, which is the only integrated telecommunications provider, has about 800,000 customers on its GSM network, about 150,000 subscribers on its Code Division Multiple Access (CDMA) network and close to 500,000 fixed lines.

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