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Kenya Airways says sacked pilots are all over 62 years old

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Kenya Airways workers next to a Boeing 737-300 freighter jet recently bought. The faces strike threat after retiring 10 pilots. PHOTO | FILE

The 10 pilots retired by national carrier Kenya Airways are all more than 62 years old and have been in employment for decades, the airline said yesterday as it moved to defuse a strike threat by staff.

Kenya Airways (KQ) said it is in talks with the Kenya Airline Pilots Association (Kalpa) which has threatened industrial action over the sackings, arguing that its members are being forced to retire early.

“The senior pilots, all between ages of 62 and 65, are expected to retire with full benefits,” said KQ in a statement.

The carrier said it was retiring the pilots according to provisions of the collective bargaining agreement (CBA) it signed with the union.

The agreement seen by Business Daily states that the retirement age for pilots will be 65 years and further provides that the airline can retire them earlier once certain conditions have been met.

“An employee may opt to retire prematurely or he/she may be retired by the company prematurely with full benefits after he/she has been in the service for a continuous period of 10 years or more provided that he/she has attained the age of not less than 50 years,” the CBA reads in part.

The pilots, who sources at the national carrier said earn at least Sh1.5 million per month, will retire in six months following the notice issued by KQ. The airline said Kalpa was yet to serve the management with the strike notice.

“Kenya Airways is in continuous engagement with Kalpa in regards to the possible fall out following issuance of early retirement notices,” said the statement.

The retrenchment came after KQ retired four Boeing 777-200 planes last year and replaced them with three Boeing 777-300 as part of its fleet modernisation plan.

This, the airline argues, left it with more pilots than it requires and ultimately led to the retirement of the 10. The pilots could have been retrained to fly bigger aircraft including the Dreamliners if they were not nearing retirement, according to KQ.

A strike would hit the loss-making national carrier’s operations hard in a competitive industry where flight delays or cancellation hurt an airline’s image.

KQ has moved to cut its wage bill in recent years to improve its financial health that has suffered from a faster acceleration of costs relative to revenue. Employees’ compensation is one of the largest expense items for KQ, besides fuel costs.

The firm spent Sh15.3 billion on its staff in the year ended March 2014, a record high, and an 18.3 per cent jump from Sh12.9 billion the year before.

The airline made a net loss of Sh10.4 billion in the half year ended September, reversing a net profit of Sh384 million a year earlier.

READ: KQ reports record Sh10.5bn half-year loss after tax

The loss was driven by a 17.5 per cent increase in costs to Sh61.8 billion, outpacing sales which grew 4.5 per cent to Sh56.7 billion.

KQ’s profit outlook looks dim in the near term owing to increased borrowing and cessation of flights to West Africa, a key market, due to the outbreak of Ebola.