An Employment and Labour Relations Court has approved a supermarket's bid to lay off 80 employees in four of its branches in an effort to contain its operational costs.
Justice Maureen Onyango dismissed a case filed by the Kenya Union of Commercial, Food and Allied Workers (KUCFAW) that had claimed that the planned layoffs of the 80 unionised employees was unlawful and non-procedural.
The union accused the retailer of deciding to terminate the employees prior to declaring the positions redundant. It further argued that Tuskys intended on working with a labour outsourcing company to replace the employees with contract staff which it termed as unfair, discriminatory and unlawful.
Justice Onyango found Tuskys' defense compelling, adding that it complied with the Employment Act laws in terms of issuing redundancy notices.
She also stated that the notices communicated the fact that various branches were to be closed in Mombasa (Digo Rd), Kilifi (Mtwapa), Nairobi CBD (Tom Mboya) and Kitale (Megacity).
The notices contained names of the affected staff who were stationed at Mombasa, Kilifi, Nairobi CBD and Kitale branches. The dismissals are to be effected on June 20, 2020.
“The notices thus complied with Section 40(1)(a) in terms of notification to the union and local labour officer, giving reasons and extent of the redundancy. The letters addressed to the individual employees were also copied to the local labour officer and the union and therefore were in compliance with the law,” said the judge.
The supermarket chain told the court that it was no longer capable of transferring staff affected by the redundancy to other branches considering the overall underperformance of its operations countrywide.
Tuskys defended that the process was not discriminatory and that 94 of the redundant employees were non-unionised. These were among 174 employees declared redundant in May 2020.
The union also requested for an order to restrain the retail chain from declaring the unionisable employees redundant and instead consider them due to the effects of Covid-19 pandemic, which the judge declined.
The retailer is facing financial difficulties that have forced it to shut down branches countrywide and eventually declare its staff redundant. It recently disclosed that it needed at least Ksh 2 billion to survive in the short-term as piling debt led to supplier desertion, stock-outs and closure of some of its branches.
Tuskys is also seeking to sell a majority of its stake to a consortium thus the need to raise capital which will ease its financial pressure, giving it more time to negotiate the sale of the stake.
