Companies - News around Africa - January 15, 2021

Again, Kenya Airways Cut Workers’ Salaries by Up to 30% as Airline Struggles to Stay Afloat

January 15, 2021

3 min read

Kenya Airways better known as KQ is set to significantly slash salaries of workers as the effect of the COVID-19 pandemic continues to bleed the airline dry, the management announced in a memo addressed to the staff on Thursday, Jan. 14.

This is a fresh pay cut at KQ, coming after 10 months, when it slashed salaries of top managers, including, Kilavuka’s – senior managers got a 24 percent pay slash while top executives now earn less than Sh200 million annually against a total wage bill of Sh16 billion. Worst still, the company’s directors were asked to work for free.

The pay cut, which is expected to take effect this month, would target workers earning 45,000 Kenyan Shilling and above. Employees were asked to expect between five percent and 30 percent cut in their salaries between six to 12 months. The pay variation would also be reviewed quarterly.

According to the airline’s CEO, Allan Kilavuka, the workers will also not get their deferred salaries which have been accrued since April 2020, at least for now.

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“I must stress that we cannot pay these amounts, and further, we do not have a timeline when payment will be possible. Should our financial and ability to pay improve significantly, we will redeem the differed amounts,” Business Daily quoted Kilavuka to have said in the memo.

He added, “our proposal, however, is that, as soon as we get a sustainable cash injection that can cover our overdues, we will, at that time, commence discussions on the payment of the deferred salaries. Similarly, should our financial situation and ability to pay improve significantly, we will redeem the deferred amounts.”

The airline has been struggling since it resumed partial operations after the ease of lockdown in the country. As at the time of filing this report, the company is yet to resume flights in some of its key routes.