KQ in next phase of layoffs as it eyes return to profitability

What you need to know:

Kenya Airways says further retrenchments necessitated by its continuous search for “productivity and efficiency gains as well as upskilling within the business.”
Mr Mbuvi did not divulge how much savings KQ, which has reported losses for four straight year beginning March 2013, would make from the latest round of retrenchments.

Listed carrier Kenya Airways has announced that it will beginning today retrench 38 employees in the second phase of a redundancy plan initiated last July as part of its back-to-profitability strategy.

The national airline in July last year retrenched 80 employees in a downsizing move which management said would reduce the company’s payroll by about Sh2 billion annually.

KQ, as the airline is known by its international code, now says further retrenchments have been necessitated by its continuous search for “productivity and efficiency gains as well as upskilling within the business.”

“After a lot of consultation the next phase of the (restructuring) process is now ready to be rolled out,” said Mbuvi Ngunze, the airline’s chief executive in a statement.

“There is never a perfect timing for such actions, and we will ensure that the process is handled within the values of our airline,” he added.

Mr Mbuvi did not divulge how much savings KQ, which has reported losses for four straight year beginning March 2013, would make from the latest round of retrenchments.

READ: KQ contracts global headhunter to hire new chief executive

ALSO READ: Workers union says no more KQ layoffs after sacking of 80

In the first phase, KQ did not offer its staff the option of applying for voluntary early retirement (VER) in an effort to put a lid on the exercise’s cost and block potential exits by key employees.

KQ’s workforce stood at 3,870 as at March last year and their cost has grown by 40.1 per cent in the past six years to Sh15.7 billion compared to Sh11.2 billion in 2011.