Telkom appeals court decision to award former staff

Telkom Kenya has asked the Court of Appeal to reverse the High Court decision that awarded Sh150 million to 996 former employees of the troubled telecom operator.

The workers, who were laid off in 2006, were each awarded Sh150,000 by the High Court on the grounds that the company discriminated against them on the basis of age after they received lower packages compared to those under 50 years.

Telkom Kenya has appealed the court decision arguing that the judge erred when he awarded the golden handshake and severance pay to the workers who lost their jobs during phase one of compulsory retirement.

“We urge the honourable court to allow the appeal… and that the orders of the superior court in the judgment dated September 28, 2011 on severance pay and gold handshake be set aside and the respondents suit be dismissed,” sought Telkom Kenya.

The telecom carried out massive retrenchment in 2006, which affected more than 11,000 employees in a bid to cut costs, citing high indebtedness, declining revenues and high staff costs. The retrenchment was done in two phases.

The first phase was for employees aged above 50 years who were paid severance payment of one month for every year remaining until retirement among other payments.

The second phase comprised those below 50 years who were paid a golden handshake of Sh150,000 each in addition to other benefits paid to those affected in the first phase. The workers aged above 50 years moved to court saying they were discriminated against on the basis of age.

The High Court agreed with the employees that they were entitled to equal and fair treatment as regards the exit packages.

Telkom Kenya argues that the difference in the exit package was due to the accessibility to the pension benefits — those above 50 years have immediate access to pension as opposed to those below 50 years.

The workers asked the Court of Appeal to uphold the High Court judgment and further direct Telkom Kenya to comply with the orders and pay them their dues.

Telkom Kenya has been facing tough competition from other competitors, which has cut its earnings.