Telkom has announced plans to send home over 500 employees to accommodate new structure it entered with Airtel Networks Kenya Limited early this year ahead of a planned merger.
In February, Telkom and Airtel announced the signing of a binding agreement to combine its respective mobile, enterprise and carrier service businesses in Kenya to operate under a joint venture company to be named Airtel-Telkom.
As a consequence, the company on Wednesday said it will discontinue the transferred business and must terminate the contracts of employees currently deployed in the affected business areas.
“In accordance with the provisions of Employment Act, we have notified communications workers union and sent out letters to individuals affected giving one month’s notice with effect from July 31,” says Telkom CEO Mugo Kibati.
We intend to terminate the employment of approximately 575 of our employees, on account of redundancy, as a result of the transaction,” he said.
In the next 30 days, the management will have a series of consultation meetings in what is aimed at ensuring transparency of the process.
However, those employees whose lines of business have not been affected will be retained in a “redefine Telkom organization.”
The Joint Venture Company, said Kibati, might consider offering employment to some sacked employees “subject to positions being available in the new organisation and those individuals meeting the recruitment criteria.”
Airtel and Telkom have already signed an agreement on the merger, and are expected to begin operating as Airtel-Telkom.
Both Telkom and Airtel Kenya have been struggling to stay afloat in an environment that has been dominated by Safaricom.
The latest data shows that while Safaricom saw its net profit for the financial period ending March 2019 increase to Sh63 billion, other reports showed that Airtel Kenya’s financial position worsened.
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