Top editors at The Standard Group are among 300 employees set to be laid off as the company plans to undertake another wide-ranging staff rationalisation to further reduce its wage bill.
Highly-placed sources have confided in Business Today that the exercise is set to kick off as soon as the Mombasa Road-based media house – which owns The Standard, KTN, The Nairobian and Radio Maisha – names a substantive Chief Executive Officer to take over from Sam Shollei who resigned two weeks ago. All its print, broadcast and digital platforms will be affected as well as management.
One of the top positions being closely watched is that of Editorial Director Joseph Odindo, a former Nation Media Group senior editor, after it emerged that Shollei had offered him an extra year without the knowledge of the Board of Directors, which had approved a two-year tenure.
It is also said there will a massive sweep on correspondents as well. Insiders say payments for contributions by correspondents has been expanding over the past one year, but blamed that on editors. Some magazine editors have struck deals with special columnists mostly outsiders who do weekly features at negotiated payments (which are often premium). So it appears like correspondents are earning more than the staff writers.
Correspondents at Standard Group earn an average of Ksh40,000 before taxation and without benefits, while some staff reporters take home up to Ksh250,000 in gross wages. Editors pocket much more depending on how they negotiated their contracts. There are fears, however, that correspondents would be sacrificed to ‘save’ the company.
The revelations came a day after it emerged that the directors have settled on Uchumi CEO Dr Julius Kipngetich, whose contract at the troubled supermarket chain comes to an end next month, to take over from Shollei.
The sources said the impending retrenchment has already been approved by the board and it will form part of the briefing the new CEO will be taken through when he takes over the reins of power at the giant media house, which undertook a similar two years ago amid dwindling financial fortunes.
Shollei fell out of favour with the board due to conflict of interest and financial mismanagement, according to insiders.
In 2015, the media house laid off over 250 staffers, among them 100 journalists, with those who opted for Voluntary Early Retirement getting better perks. They included Human Resources Director Pauline Kiraithe, who ballooned the wage bill by embarking on a poaching spree mainly targeting journalist from the Nation Media Group, her former employer, by offering them stellar salaries.
When she was asked to offload them, the company was forced to borrow money for the exercise. In its annual results for that year, the media house reported a loss of Ksh400 million with the rationalisation cost making a big percentage of the results.
Almost all media houses have since laid off staff as part of efforts to reduce operational costs as a result of reducing ad spend, competition from online platforms and new entrants leveraging on digital broadcasting and a battered economy that has affected people’s spending power.