Capital FM is set to fire a number of employees under what has been termed as restructuring. This comes after the employees refused to accept a pay cut offer from the company.
According to MaryAnn Musangi who heads Capital, only seven employees out of 112 worker who have accepted the pay cut offer.
“The reality is that even after engaging in consultation with employees, only 7 members of staff out of 112 have consented to the proposed salary reductions,” said Musangi.
“We are therefore unable to gain traction with this proposal put forward and in compliance with the Employment Act, we are left with no option but to defer the proposal and radically rethink the future of our business,” she added.
The media house is the property of the late billionaire Chris Kirubi and is currently led by Ms. Musangi who is Kirubi’s daughter.
According to a letter addressed to all employees, Musangi explained that the business has been making losses since 2018.
She said that in 2020, the business had resulted to pay cuts in a bid to avoid firing workers.
In early 2022, the business reinstated full salaries after improvement in performance.
“Early 2022, our revenues started to improve and in April 2022 we reinstated ful salary pay. This decision was based on continued growth of revenues enabling 100% salary pay – a commitment you as staff made to each other,” said Musangi.
This has however not been sustainable and has forced the business to consider pay cuts or a reduction in its workforce.
“Unfortunately, this action of reinstating 100% salary did not motivate the staff to continue driving the revenue targets and we have since witnessed a further slump in revenues which has put the company deeper in the red,” she said.
She informed the employees that the pay cuts that were supposed to kick in this December will not be effected following their rejection by the workers.
However, there will be restructuring that might result in job terminations.
“The company is in huge financial difficulty and cannot continue to operate under the current conditions. The options moving forward will involve a restructuring of the business,” she said.
