Manufacturer Declares Redundancies Over Tough Business Environment

A photo of  man at a manufacturing company
A photo of a man at a manufacturing company
Photo
Alliance Employment Services

Employees of a renowned manufacturing company in the country are staring at job losses after the industry announced the termination of several of its employees.

In a notice, the company's management revealed that the company had decided due to the tough business environment and rising inflation levels that have made it difficult for the company to sustain its current staff levels. 

"After careful consideration, there are positions which will not be required. This was an extremely tough decision, and we do understand the impact this will have on the employees and their families," read part of the notice.

The employees have been advised to prepare for termination with the process set to begin on March 1, 2024.

An empty manufacturing plant
An empty manufacturing plant
Photo
Goodwin University

The company has also adopted a new business strategy geared at increasing productivity and guaranteeing longevity in the market despite the current tough economic times.

In the notice, the company however outlined that the employees will be eligible for their final dues as required by the Employment Act.

According to the law, the employees are entitled to notice pay, severance pay, and pension dues, among other dues. Employees who owe the company on the other hand will also face deductions.

"Employees declared redundant have a right to be paid their leave days not taken in cash and severance pay of not less than 15 days’ pay for each completed year of service," reads part of the act.

In the past months, companies employing hundreds of Kenyans have raised alarm over rising inflation and increased taxation which have made it harder to run businesses in the country.

Last week, a maize company shut down its operations and announced it was selling its property for Ksh400 million. 

A private school in Nairobi also closed down last year, due to the tough times burdening the business community. The sudden closure left students and their parents stranded.

A survey conducted by the Central Bank of Kenya in December predicted that the economy will worsen forcing more companies to lay off workers. Mass layoffs will be announced between January and April 2024. 

A parent and a student carrying a box during school reopening in January 2023.
A parent and a student carrying a box during school reopening in January 2023.
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Teachers Arena