Oserian flower firm has placed more than 800 workers on unpaid leave after the staff declined a 50 percent pay after the coronavirus hit flower exports.
The workers declined the offer to defer half of their salaries until the end of coronavirus to ease the financial impact of the pandemic.
The deadlock forced the firm to place the workers on unpaid leave in line with recent legal changes that discourage pay cuts and layoffs due to effects of the infectious disease.
With almost 4.35 million cases of coronavirus globally and nearly 300,000 deaths, countries have been reluctant to fully open shut borders and businesses.
Few people are thinking about flowers, especially in Europe — which accounts for 70 percent of Kenya’s cut-flower exports.
“We have been facing financial difficulties since the emergence of Covid-19, which has impacted negatively on our cash flow, what we have been asking of our employees is to accept a 50 percent deferral on their pay, which would be paid back when things get back to normal, but they refused,” said Mary Kinyua, human resource director at Oserian flowers.
“When they refused we did not have an alternative but to send 800 of them on unpaid leave,” she added, pointing out that the firm has 1,200 employees.
Kenya Flower Council says restrictions to movements have slashed daily orders by half, forcing firms to mull layoffs and salary cuts
The decline in exports will is a blow for Kenya where flower exports are one of the top three foreign exchange-earners. They generated Sh104 billion in sales in 2019. Other sectors like tourism and agriculture are also being battered.
The firm was hit last weekend during Mother’s Day when orders for flowers went up amid a shortage of experienced labour in the firm to pluck and park the roses, a move that saw the company lose about 30 percent of what they would have sold on that day.
The HR director, however, said the production had reduced to where it was before the Mother’s Day.
Ms Kinyua said the management staff at Oserian have already taken a 50 percent deferred salary since February.