On the planned strike by the union of Kenya Airways pilots, we are being treated to the exploits of a labour aristocracy - a layer of self-absorbed and privileged workers that has over the years perfected the art of using its grip on the State-controlled company to perpetuate dominance and to always have its way.
When Covid-19 struck, all firms were forced into effecting pay cuts and lay-offs. Today, many have not returned to previous levels.
Thousands, especially small companies went under and may not come back. A pandemic amnesty mood swept through the length and breadth of the industrial relations sector forcing both unions and employers to accept that pay cuts and lay- offs were necessary.
But the barons of the 400-member powerful pilots union saw an opportunity to negotiate something better for the labour aristocracy within KQ’s workforce : instead of pay cuts and lay-offs, the pilots negotiated deferred salary payments, meaning that salaries and emoluments not paid during Covid had to be remitted later.
The crux of the strike threat the pilots are planning is a demand that the salaries and benefits that were suspended during Covid must be paid now. Yet another issue of contention in the row is payment of worker’s provident fund contributions that were also suspended.
The way I see it, this is not an ordinary dispute between a group of employees and some tight-fisted employer that is resisting to pay workers what is due to them. The reality is that this is a dispute that pits interests of the pilots union and the ordinary taxpayer.
If you look at the company’s published accounts, Kenya Airways is not currently in a position to pay the pilots what they want. The company is in the middle of a taxpayer funded financial restructuring plan aimed at cleaning its balance sheet and whose impact on the finances of the company will take much longer to happen.
Just the other day, the government was forced to come in to pay $ 85 million to global aircraft leasing firms that had threatened to shut down the airline’s operations over delays in closure of a 20 percent haircut deal on rentals that KQ signed with lessors several months ago.
There is also the fact that the government has been struggling to restructure a $ 525 million loan the airline borrowed in 2017. Last year, the guarantee was called by the lenders as a result of loan repayment defaults. The Cabinet gave approvals for the government to pay the loan arrears on KQ’s behalf and for the balance to be renegotiated via a process known as a novation.
The point, therefore, is this. A protracted strike will not only ruin all the plans to clean the company’s balance sheet but also unravel and diminish the green shoots of recovery in turnover of the business that are just starting to show.
KQ is currently doing very good business. For instance, the London route has grown weekly frequencies from seven to12 and at a load factor of 91 percent, Paris at seven flights at a load factor 92 percent while New York is at five weekly flights at a load factor of 91 percent.
Kigali, despite fierce competition from Rwandair has grown from four weekly flights to 11 with a load factor of 82 percent while Entebbe has grown frequencies from double daily to triple daily with a load factor of 72 percent.
The pilot’s union is the most powerful trade body in the land in-terms of both control of rank and file and success rate in getting the airline and the government to acquiesce to its demands. The assertiveness, the sense of entitlement, and uncompromising attitude of this union originates from a mind-set born and bred by past experience, and from the fact that the government and the employer have always allowed pilots to win even in circumstances where their demands were outside the scope of collective bargain agreements.
That mind set and sense of entitlement was displayed starkly in May 2016, when the union demanded the resignation of the CEO, Mbuvi Ngunze and several top managers, including the board chairman, Dennis Awori. They won. The current stand-off is not any different with similar demands on both chairman and CEO.
My parting shot. A resolution for the current industrial dispute will not come from the usual trade union negotiations. This is a test on the political will of the new administration of President William Ruto to stem chaos and disruption in the aviation sector. This is politics. Stupid.
The writer is the former managing editor of The EastAfrican newspaper.
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