Kenya Airways (KQ) will resume payment of workers' provident fund next month offering a major relief to hundreds of staff who had missed the benefit during the Covid-19 pandemic period.
The airline’s chief people officer, Tom Shivo, on Wesday, informed workers through a memo that KQ will start remitting its contribution to the staff provident fund effective March 2023 but it will not be obligated to backdate payments that were stopped during the suspension.
The employer and employee rate of contribution, Mr Shivo said, will also remain unchanged at 10 percent of the basic salary.
"In the past few months, we have been engaging various stakeholders and after evaluating the continued improvement in operations, the company has decided to resume contributions to the staff provident fund with effect from March 2023," said Mr Shivo in the February 22, 2023 memo.
Non-payment of provident funds by KQ was the main reason pilots went on strike in early November 2022.
The other matters that Kenya Airline Pilots Association (Kalpa) wanted addressed included the proposed ouster of the board and executives for alleged governance and leadership failure, the airline’s delay in implementing pay agreements (CBAs), and alleged victimisation of the association's members.
The four-day strike caused the cancellation of many passenger flights besides disrupting cargo operations. The pilots resumed work after a court order.
Before the strike, KQ had warned that industrial action could jeopardise its recovery from Covid-19, resulting in losses the airline estimated at Sh300 million a day.
KQ froze paying the monthly pension contribution in the wake of Covid-19.
It requires about Sh1.3 billion annually for the contributions, with the pilots’ share accounting for about Sh700 million.
The airline last year said it could not continue paying the provident fund and salary arrears of Sh6.5 billion due to depressed revenues.