Less than a year since the NIC and CBA banks merged to form the NCBA bank, the new entity has announced plans to retrench a number of employees due to difficult financial times.
In a statement to the employees, Group Managing Director John Gachora said that the redundancy will be done through voluntary basis (Voluntary Exit Program) of forced exits (Redundancy Program).
“Today, I announce that we are embarking on a process to reorganize our workforce which will result in reduction of staff headcount. The COVID-19 pandemic, which is the most harrowing health and economic crisis of our lifetime, has affected the execution of our growth plans,” said Gachora.
“Looking across the globe at the economic uncertainty that persists, it is clear that the recovery will be a lot more protracted than we could have imagined, and that we must adjust to our new reality. Bank customer behavior has changed irredeemably. The future expansion of our Bank may look very different from what we imagined just a few months ago,” he added.
The Voluntary Exit Program will be available to all full-time/permanent employees of NCBA Kenya businesses and who have not tendered resignation as of October 30, 2020.
Through this programme, staffers will get salary to the last day at work. Also, exit payment will be calculated at the rate of one month’s salary for each completed year of service or payment for the months to retirement whichever is lower.
“Employees whose application will be accepted will have a month’s notice to leave the Group or payment in lieu of notice as per the individual employment contracts. (Employees will have )access to Provident Fund benefits in accordance with the Scheme Trust rules and Retirement Benefits Authority (RBA) regulations,” added Gachora.
NCBA has also offered the staffers a 10 percent discount on outstanding loans if settled in full within six months after exit.
“Any outstanding staff loans will continue to accrue interest at staff rate for a period of one year after which the outstanding amounts will revert to commercial terms,:” he added.
The Redundancy Program will be implemented simultaneously depending on the outcomes of the Voluntary Exit Program.
“The benefits under the Redundancy Program will be determined in accordance with the law, but in any case, no better than those of the Voluntary Exit Program,” said Gachora.