National carrier Kenya Airways has today fired 38 more employees as part of its restructuring geared at turning its fortunes around. The airline announced that it had entered the second phase of a comprehensive restructuring that has already started bearing fruits. Phase one, implemented in July 2016, saw 80 employees pushed out.
“After implementation of Phase 1 of the restructuring process, we continued looking for opportunities for productivity and efficiency gains as well as upskilling within the business,” said said Group Managing Director & CEO Mbuvi Ngunze. “After a lot of consultation, the next phase of the process is now ready to be rolled out. There is never a perfect timing for such actions, and we will ensure that the process is handled within the values of our Airline,”
He said the management appreciates that is a difficult period for Kenya Airways family and employee assistance will be available for affected staff. Over the past one year, Kenya Airways has been implementing its turnaround strategy codenamed ‘Operation Pride’, which focuses on three main priorities – closing the profitability gap, refocusing the business model as well as optimizing the capital structure of the company.
The strategy has started to bear fruits with the business reporting operational profit as at its half year 2016/2017 results.
The airline has been forced to make difficult decisions. Kenya Airways issued a notice to right size through staff redundancies and redeployment on March 31, 2016 as required by law and an update was issued to staff on May 4, 2016.
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The process is in full compliance with labour law, Collective Bargaining Agreements and individual staff members’ contracts as appropriate, it said. Operation Pride is expected to deliver $200 million (Ksh20 billion) as the airline cuts down on expenditures, sale and sublease of aircraft, reduces waste in catering, and renegotiation of some contracts.
The airline, which recently reported a full-year loss of Ksh25.7 billion has been facing serious financial difficulties in the past one year with pilots threatening to strike demanding the immediate resignation of CEO Mbuvi Ngunze over alleged mismanagement. Indeed the board has been shaken and the CEO has resigned.
[crp]
