Kenya Airways in contempt over labour issues

Kenya Airways in contempt over labour issues

Kenya Airways Embraer 190-100 Kenya Airways (KQ, Nairobi Jomo Kenyatta ) management has been found guilty of contempt of court for recruiting 800 workers on short-term contracts and at reduced pay, according to Nairobi news reports.

This follows an application by the Kenya Aviation Workers Union against Kenya Airways and its chief executive officer, Allan Kilavuka, and chief human resource officer, Evelyne Munyoki, in the Employment and Labour Relations Court in Nairobi.

The Star newspaper reports the court on September 16, 2020, found both Kilavuka and Munyoki had disregarded a December 6, 2019 court order barring them from hiring staff under reduced terms.

Kenya Airways has been battling court cases by KAWU and the Kenya Airline Pilots Association over its hiring and firing procedures as it attempts to cut costs after its first-half revenue plunged by 48% to KES30.million shilling (USD276,525.89) amid COVID-19 travel restrictions.

In August, the Employment and Labour Relations court stopped the airline from laying off 182 pilots pending the determination of a case challenging the move. The airline projects it would require 258 of its 414 pilots for reduced operations. The company has 4,660 workers with an annual wage bill of about KES14.4 billion shillings (USD133.2 million), about 45% of which goes to pilots. The cuts could save the carrier KES4 billion (USD479 million) a year, according to court fillings.

In July, the court prevented Kenya Airways from laying off some of its staff and sent others on unpaid leave ahead of the resumption of domestic flights. At the onset of the COVID-crisis in March 2020, Kenya Airways had sent part of its workforce of about 4,000 employees on unpaid leave with those remaining taking pay cuts between 35% and 75%.

On the verge of nationalisation, Kenya Airways is seeking USD500 million from the Kenyan government to navigate the current crisis, Bloomberg reported. The funds could be in the form of equity or a loan from the government, which is in talks to buy out minority investors, including KQ Lenders Co. and Air France-KLM as lawmakers debate a nationalisation bill. The National Aviation Management Bill 2020 plans to establish the Kenya Aviation Corporation. This entity would become the new holding company of the Kenya Airports Authority and Kenya Airways, upon its nationalisation and delisting from the Nairobi Securities Exchange (NSE).

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