The Mediamax management suffered a blow on Wednesday after the Employment and Labour Relations Court thwarted the company’s attempts to enforce pay cuts the company said were necessary to keep the company afloat pitting the company against 164 employees who protested the proposed huge slashes.
In a virtual ruling on Wednesday, the court ruled that the company must honour existing contracts even as it plans to retrench more staffers in the coming days. Mediamax was further ordered to pay the staffers their accrued April and May salaries in full.
“With no orders on costs and with further orders that the contract of service between parties is preserved with no pay cuts but affected staff may go on redundancy per law and prevailing contracts, ” ruled the court.
“The contract is in place without pay cuts and the law says when they should be paid so the law is in place.” further ruled the judge.
In April, 164 staffers among them K24 TV Presenter Eric Njoka, Milele FM Presenter Felix Odiwour alias Jalang’o moved to court protesting the pay cut and obtained an injunction stopping the proposed cuts pending the hearing and determination of the matter.
Mediamax in a letter to staff signed by Acting Chief Executive Ken Ngaruiya had proposed a 50% cut for high earners and a 20%- 30% for regular earners.
In the letter, Mr. Ngaruiya had observed that the media house’s business wing was facing difficulties as the COVID-19 Pandemic continues to affect businesses across the world.
“Our clients have been adversely affected and within a short span of time have had to make difficult decisions regarding their employees and their businesses including cancellation of their communication and advertising plans,” he said.
“We shall review the situation once normalcy resumes based on revenue, cashflow and the state of the business going forward. Due to reduced level of operations due to the COVID 19 pandemic it has become necessary to request staff whose services are not required during this period to proceed immediately on leave.” added Mr Ngaruiya.
Since then, a series of events have unfolded at Mediamax including the resignations of the group’s seniormost editor and K24’s most popular presenter.
On May 7, Peter Opondo, the then senior-most editor at Mediamax overseeing the editorial functions of print, broadcast, and digital divisions resigned over frustrations regarding the management’s business decisions during the COVID-19 period and mostly because of the widely publicised pay cuts saga.
Weeks later, star presenter Betty Kyalo quit in a huff and later said that she felt undervalued at the organisation. Kyalo was poached on a six-figure salary and was one of the faces tapped to represent “the new look K24”.
The resignations of the two were preceded by reports that K24 will be altering its programming to reflect its precarious financial position. Business Today has reported that due to the economic strain at DSM Place, K24 will scrap most of its programs save for Anne Kiguta’s Punchline and adopt KTN’s feed.
That’s not all.
In another notice to staff, Ngaruiya reiterated his earlier communication that the company was struggling to maintain its payroll and prepared them for another round of sackings.
“Mediamax Network Limited regrets to advise, that owing to the ongoing COVID-19 Pandemic, that has had adverse effects on revenue streams, it shall organise its staff structure and abolish some positions as part of its cost optimization measures in the wake of its new business realities,” read the notice.
“In view of the above, the services of some of its employees will be rendered superfluous thereby necessitating the termination of their employment on account of redundancy,” read the notice.
All this is despite the fact that President Uhuru Kenyatta made an impromptu visit to DSM Place. Uhuru was worried that the situation was getting out of hand and was impacting negatively on his family’s reputation and his political image.