It’s Layoff Season In Kenya – Another 255 Employees To Be Cut Loose By Stanbic Despite Decent Profits

It appears it’s layoff season for banks in Kenya. In June this year, some 112 employees were cut loose by the struggling National Bank of Kenya (NBK). And it does look like hundreds more are about to be left jobless too as CfC Stanbic Bank has delivered some bad news of its own.

Actually, it was all good news earlier when the CfC Stanbic Bank announced a 14.38 percent rise in net profit in the first half of the year ended June — a feat which the bank claims was boosted by higher interest and non interest income — but that was just a red herring for what was to come soon after. And this one’s sure to affect a lot of people in more ways than one.

CfC Stanbic Bank may have recorded decent numbers in the first half of the year but the bank has chosen to make some tough calls all the same as there are plans to lay off 255 employees in a move which the company says is aimed at reducing cost.

Capital Business claims to have come by a memo in which the company has offered permanent and pensionable employees a voluntary early retirement package, which they are at liberty to accept or decline.

According to sources from the company who spoke about the matter on the condition of anonymity, the employees have until Friday to give feedback on the give-or-take offered by the bank.

“We have been given until Friday to make up our minds to sign up for the scheme but the majority of us are not pleased with this since we will still be jobless and some of us have been here for over 15 years,” a source said, while suggesting that the bank had planned to fire all the employees without offering any benefit plans.

If the memo is anything to go by, CfC Stanbic Bank has opted to offer the employees that are about to be laid off their monthly salaries to the last day of work.

The Bank is also planning an ex-gratia payment plan calculated at the rate of one-and-half month’s salary for each completed year of service in recognition of the service rendered to the Bank by the affected employees.

Under the new severance payment plan whipped up by the bank, there will also be the following; payment in lieu of notice as per the individual employment contract, retention on the medical scheme for the remainder of the calendar year up to 31st December 2019, and 25 percent loan discount on the immediate settlement of any outstanding staff loan balance. On paper, it’s a fair recompense. But in reality, the loss of jobs will destabilize things for the many individuals who must now bear the brunt.

CfC Stanbic made a net profit of KES 4 Bn in the first half of 2019, compared to KES 3.5 Bn in the same period last year. The layoffs come even as the bank posted a 14.38 percent surge in net profit in the half-year ended June.

Featured Image Courtesy: capitalfm.co.ke