East African Portland Cement has announced a voluntary early retirement scheme in response to the financial challenges from COVID-19. Acting managing director Stephen revealed that the program will help keep the cement manufacturer afloat amid shrinking revenues.
“Our primary intent is to be as transparent as possible and provide our people with choices as we continue to reshape our business as a win-win approach to staff issues,” Stephen said.
Nevertheless, MD Nthei promised that the early retirement scheme will not affect the manufacturers operations.
“We remain focused on managing our cost base and affirm that the restructuring will not have any negative impact on the services and products we offer.”
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EAPPC has implemented several workforce reductions as it struggles with decreasing revenue. In February 2020, the company fired 150 employees. Similarly, the company fired 800 staff, including 136 managerial staff in 2019. The redundant staff could only reapply for merged positions if they could take a 40% pay cut.
According to Business Daily, Staff costs account for the majority of the company’s expenses. Last year, the company’s staff costs stood at KSh 4 billion, almost 80% of its sales.
Before its descent, EAPCC was the third largest cement manufacturer in the country, with a 15% market share. Kenya’s pioneer cement company began its descent due to disputes over its ownership. Neglect and high staffing costs drowned the company into further losses.