The Kenya Airways board has approved the downsizing of staff, networks, and assets citing the adverse effects of Covid-19 on its operations.
The airline formally notified the pilots association of its intention to shed off a large number of its workforce in a Friday notice. The management says the fall in revenue has undermined the airline’s ability to continue optimal operations.
KQ intends to carry out an organisation-wide restructuring, which it says would culminate in a reduction in its network, assets and staff.
Acting CEO Allan Kilavuka told the Kenya Airline Pilots Association (Kalpa) the redundancy process will commence immediately.
He assured the association the company shall adhere to the provisions of the labour laws, the comprehensive bargaining agreement (CBA), and any related court orders.
“The employees affected by this move will be accorded the respect and dignity that is required,” the letter to Kalpa CEO Captain Murithi Nyaga reads.
The KQ boss said an internal review of operations conducted in May revealed the operations would not be sustainable with the status quo.
Kilavuka held that KQ, as is the case with other airlines globally, has been severely hurt by the pandemic, with the limited flying schedule not promising sufficient revenues.
The airline says with the suppressed demand for air transport, a large part of its fleet will remain grounded.
“We will also keep operating a reduced network as it will take some time before the industry starts to rebound,” Kilavuka said.
He added that short- and medium-term projections indicated that KQ must reduce operations to withstand reduced customer demand and economic shocks.
KQ on Friday suspended flights to eight destinations in Africa, citing operational challenges. They were flights to Bamako, Blantyre, Brazzaville, Djibouti, Luanda, Khartoum, Maputo and Mogadishu.
Various governments have instituted travel restrictions to stem the spread of Covid-19, a situation that has taken its toll on the aviation sector.
About 1,500 employees of the 3,734 at KQ as of last December stand to be discharged from their roles in the company-wide restructuring.
About 33 per cent of the workforce are in-flight operations, while ground operations account for 24.9 per cent, technical (13.8 per cent), commercial (12.5 per cent), cargo (4.3 per cent), and other sections (11.3 per cent).
The remuneration of the airline’s staff constitutes a significant cost of operations, accounting for about 20 per cent of total costs.
Captains earn an average of Sh1.6 million per month; first officers (Sh900,000); flight operations (Sh225,000); while technical, ground services, cargo and commercial staff earn an average of Sh150,000 monthly.
Kalpa approximates that over 4,000 families that directly depend on Kenya Airways will be adversely affected by the redundancies.
In an open letter to President Uhuru Kenyatta, Nyagah said the downsizing would result in the country losing highly trained talent to foreign carriers.
The association says Nairobi further risks losing its place as the regional hub to Addis Ababa or Kigali where respective airlines are facilitating investments.
“Downsizing will jeopardise the investment Kenya has made in improving airport infrastructure, resulting in significant tax revenue loss from the sector.”
Kalpa argues it would have been prudent if KQ took advantage of gaps left by the closure of Air Mauritius and South African Airways.
The captain said such a move would give the country an opportunity to “capitalise on the maturity of her hospitality and fully use the substantive investment at JKIA”.
“We are confident our proposal will help navigate the aviation sector through the pandemic and drive sustainability in the new normal,” the pilots said.