NAIROBI, Kenya, Aug 31 – Prime Minister Raila Odinga has directed the management of the Kenya Airways (KQ) to immediately suspend the planned retrenchment of staff.
In a letter written by the Permanent Secretary at the PM’s Office Mohamed Isahakia to Transport Permanent Secretary Cyrus Njiru, Odinga said the rationalisation programme raises several questions on how it is being carried out, and if it is necessary for KQ to retrench its staff.
The PM has ordered for proper consultation between the government, the KQ management and the workers.
The rationalisation programme was expected to see between 650 to 1,500 Kenya Airways employees leave the airline.
However the PM said it is still unclear whether Kenya Airways management has explored all available options for reducing its wage bill including introducing pay cuts and if the company has engaged the Aviation and Allied Workers Union (AAWU) in discussions over the planned staff rationalisation.
The PM also wants the management to make it clear if it is only planning to send away employees of Kenyan origin and protect jobs of foreign nationals.
“In the recent past, similar public companies such as Orange Telkom Kenya that have taken massive employee retrenchment, entered into negotiation with the workers union and agreed on a settlement package that was mutually acceptable to both parties and the government, “the letter reads.
This comes even after the Industrial Court on Thursday failed to renew a court order that was stopping Kenya Airways from cutting staff numbers.
KQ announced plans to shed off some staff through voluntary retirement, redundancies and outsourcing of non-core roles adding that direct operating costs were putting pressure on its contribution margin, thereby reducing KQ’s ability to operate profitably.
The airline had issued notices on August 1 and 2 to lay off at least 300 employees, but the AAWU went to court and obtained temporary orders that prevented their sacking.
In its application to the court and even to the PM, the union claimed that KQ was currently employing foreign cabin crew and had outsourced a company to recruit more on contract basis of between one and two years.
It also faulted the sacking plan saying that the airline had not complied with the principle of consultation, concurrent agreement and engagement with them as provided for in the recognition agreement.
According to the airline, its labour costs have more than doubled in the last six years to stand at Sh13.4 billion s, hence the need to streamline its cost structure.