Kenya PM blocks Kenya Airways' planned staff cut

Nairobi, Kenya (PANA) - A bid by Kenya Airways to reduce its workforce has taken a new turn after Prime Minister Raila Odinga directed the airlines' management  to immediately suspend the  plan.

This comes a day after the Industrial Court in Nairobi, the nation's capital, gave the management the go-ahead to conduct the exercise, upon the expiry of the 14-day restraining order it gave after the airline workers union went to court.

In a letter written by the Permanent Secretary at the PM’s Office, Mohamed Isahakia, to Transport Permanent Secretary Cyrus Njiru, Odinga said the rationalization programme raises several questions on how it is being carried out, and whether it is necessary for Kenya Airways to retrench its staff.

The Premier ordered proper consultation involving the government, the airline's management and the workers.

The exercise, which the airline calls rationalisation programme, was to see 650 members of staff sacked. It was to kick off with a  voluntary retirement programme.

But the PM believes the Kenya Airways' management has not explored all available options for reducing its wage bill, including introducing pay cuts.

Odinga also wanted to ascertain 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.

Kenya Airways, citing high costs of operations, said it was planning to reduce staff  through voluntary retirement, redundancies and outsourcing of non-core services.

The airline had issued notices on 1-2 August to lay off at least 300 employees, but the AAWU went to court and obtained a temporary order that prevented their sacking.

According to the airline, its labour costs have more than doubled in the last six years to stand at Sh13.4 billion (about US$150 million), hence the need to streamline its cost structure.

Two of Kenya Airways' core targets are to make Nairobi the east and central African airline hub and to become the top African airline with extensive network in the continent and beyond.
-0- PANA DJ/SEG 1Sept2012