A Kenya Airways plane at the JKIA in Nairobi. FILE PHOTO | NMG Kenya Airways has failed to reach a deal for its pilots to be paid per trip as the national carrier seeks a lower wage bill to weather the coronavirus storm that has crushed air travel demand.
KQ chief executive officer Allan Kilavuka said talks are deadlocked with the pilots union to adopt a pay based on productivity.
At the moment, KQ’s pilots who consume 45 percent of the carrier’s wage bill are paid a fixed monthly salary.
“The negotiations have been ongoing. We have not been able to get an agreement for them to move to productivity-based pay,” said KQ chief executive officer Allan Kilavuka.
Pilots account for 10 percent of the airline’s total workforce, but take home the equivalent of 45 percent of the overall payout to employees or Sh6.1 billion based on the carrier’s wage bill for the year to December.
The airline’s wage bill stood at Sh13.62 billion or Sh1.35 billion monthly in the year to December, down from Sh17 billion a year earlier.
The carrier had forecast to save nearly Sh3.24 billion from its desire of having between 207 and 248 pilots on its books. It had 414 pilots last year.
Mr Kilavuka said discussions are still underway to agree on alternatives ways of cutting the wage bill as it is keen to reduce its overheads at a time when demand for flying has remained low.
He said to cut down on wage bill the company is implementing a raft of measures including basing the pay of the new employees on productivity.
The carrier, which has been making losses even before the Covid-19 pandemic, says it is at the moment operating just slightly over 50 percent of the capacity with the cabin load factor having dropped from 75 percent previously to 60 percent. The carrier announced last week that it will delay its employees pay for this month, pointing to a serious financial shortfall at the company.
The airline on Thursday informed workers through e-mail of pay delay as the carrier struggles to meet the demands of its 3,652 staff that were on its payroll by December.KQ’s net loss in the financial year to December nearly tripled to Sh36.2 billion.