CMC Motors Group has announced plans to declare 169 employees redundant with the first phase of layoffs starting on Tuesday.
This comes after Ford, Suzuki and Mazda terminated or gave notice of termination of their distributorship contracts with CMC Group starting Monday until Q3 (third-quarter) 2023.
In a statement dated April 24, Managing Director Sakib Eltaff said this, among other issues, led to a re-organisation of the Group's business in line with a growth strategy that will see it place great focus on the agricultural sector.
"This will result in a reduction in the number of roles and the resources required to execute the remaining functions. This means that it will become necessary to declare 169 employees redundant," Eltaff said.
He added that the employees affected are in both management and unionisable categories.
The company intends to undertake the redundancy in three phases as the distributors wind up operations with CMC Group between the 2nd quarter and the 4th quarter of 2023.
Among those affected are employees who work in Admin and Support, Finance, IT, Legal, Logistics, Senior Management, Parts, Procurement, Projects, Sales and Service departments.
"In declaring the employees redundant, every measure will be taken to ensure compliance with the requirements of Section 40 of the Employment Act, individual contracts of employment and the Collective Bargaining Agreement between the company and the Union," CMC assured.
It added that the employees will be paid their terminal dues in accordance with their contracts of employment and as guided by the exiting Collective Bargain Agreement.
This will include salary for days worked up to the date of termination, salary in lieu of notice based on the number of years and CBA, severance pay for each completed year of service based on the number of years and CBA and pay in lieu of leave days accrued but not taken.
"In compliance with the requirements of section 40 (1)(a), the Labor Officer in charge of Nairobi County is concurrently notified," Eltaff said.
Regarding the terminated distributorship contracts, CMC said it will cease distribution of the three passenger vehicle brands in the market in the next few months.
