Kenya Power #ticker:KPLC has made a U-turn on plans to lay off an unspecified number of employees from its 10,481 workforce in a bid to cut costs as part of a fresh plan to return to profitability.
Managing director Bernard Ngugi said in a statement to staff on Friday that the electricity distributor would not send them home as it had earlier indicated in tender documents.
“I would like to assure you that the company has no plans to lay off any staff member,” Mr Ngugi said in the memo seen by Business Daily.
“The company will therefore make the requisite changes on the tender document to reflect this position.”
The loss-making company had earlier said the restructuring plan had been informed by its current financial challenges which have affected its ability to run sustainably and deliver on its obligations to shareholders and the public.
“Over the last four years, the company has experienced a general decline in its financial situation as depicted by reduced net earnings,” the company said in internal documents seen by Business Daily.
“In a bid to turn around and transform the financial performance of the company; improve efficiency and enhance customer experience, KPLC...[is eyeing] phased reduction in workforce to ensure KPLC remains competitive and provides the right levels of service.”
The company had sought a technical adviser to implement the restructuring plan, that also included reduction of debts, electricity theft and strategy for renegotiating bulk power purchases from firms like KenGen #ticker:KEGN.
On Friday, Mr Ngugi said Kenya Power would amend the tender document that had shown that it was eying a phased reduction in workforce.
“We are optimising our staff complement with the aim of enhancing productivity and responsiveness to customer issues,” he said.
The jobs restructuring plan was likely to become a flashpoint with unions opposed to it at a time the unemployment rate has shot up.
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