State wades into Fairmont bid to terminate workers' contracts, says it will hurt economy

In Summary

Hotel management cited effects brought about by the coronavirus pandemic

Kennedy Ogeto takes the oath of office as Solicitor General during his swearing-in at State House in Nairobi, March 20, 2018. /PSCU
Kennedy Ogeto takes the oath of office as Solicitor General during his swearing-in at State House in Nairobi, March 20, 2018. /PSCU

The government has demanded answers from the Fairmont group management following its move to close its hotels and send employees home.

On Thursday, Fairmont, which owns the Norfolk in Nairobi, shut its hotels indefinitely.

It announced that it will terminate all employees' contracts following uncertainties caused by the coronavirus pandemic.

 “Due to the uncertainty of when and how the impact of the global pandemic will result in the business picking up in the near future, we are left with no option but to close down the business indefinitely,” a memo to staff signed by the country general manager, Mehdi Morad, said.

Fairmont said it had taken into consideration various demands raised by its employees.

The demands, Morad said, were out of reach for the company in the prevailing circumstances.

Morad said the decision of the management to terminate the services of all its employees was due to frustration "by way of mutual separation and taking into account the loyalty and dedication the employees have put into the success of the company in the previous years".

The general manager urged the staff to pick their termination letters on June 5, saying the employees will be entitled to one month’s pay in lieu of notice.

However, solicitor General Kennedy Ogeto in a letter to Morad is now seeking answers, saying the issue is a matter of public importance.

“This matter is of public importance and great concern to the government and in view of the Attorney General’s mandate to promote, protect, and uphold the rule of law and defend public interest, this office should be very grateful if you would provide it with clarification regarding the said media reports and complaints from employees including on the veracity thereof and justification for taking such action, if this is the case,” Ogeto said in a letter dated May 29.

The letter is copied to Head of Public Service Joseph Kinyua, AG Paul Kihara, Labour CS Simon Chelugui, and PS Peter Tum.

Ogeto said such a decision will have far-reaching implications on the well-being of many households and the Kenyan economy in general.

“This is therefore a matter of profound public interest, in respect of which this office demands a response.”