Court bars Telkom from selling prime properties

PHOTO | FILE Telcom Kenya chief executive officer Mickael Ghossein.

What you need to know:

  • Listed properties include Extelcom House, other premises and warehouses

Telkom Kenya got into more trouble with its former employees after the Industrial Court stopped it from disposing some of its prime properties.

Lady Justice Monica Mbaru issued the temporary orders, stopping the company from disposing its assets in towns across the country, pending the determination of a suit by over 900 retrenched employees.

“Pending the hearing of this application, the court issues an injunction restraining the company or its agents from entering into any agreement for the sale of Telkom Kenya Ltd to a third party, or any of its properties until the former employees’ claims are settled,” ruled Judge Mbaru.

The listed properties include Extelcom House, several other premises and warehouses in Nairobi, Kisumu, Mombasa, Nakuru, Eldoret, Nyeri and Kericho.

The 946 former employees, through lawyer Anthony Oluoch, are demanding over Sh2 billion in arrears for their golden handshake and severance pay.

“Telkom Kenya is in a serious financial crisis and has been negotiating with other parties with a view to selling the company and its properties. The ex-employees are apprehensive that they stand to lose their entitlements if the sale goes ahead,” he said.

Liquidity crisis

He added that Telkom is in a liquidity crisis and may end up going into insolvency, which will make it impossible for the former employees to enjoy the benefits of their claims should the court award them the amount they are claiming.

The former employees complained that the company discriminated against them for being over 50 years at the time of the retrenchment, since their colleagues below 50 years were given the golden handshake and severance pay.

The group joins another batch of 997 former employees who were awarded a total of Sh3 billion as compensation for termination of their employment.

The Court of Appeal in October last year ruled that there was no justification why Telkom refused to pay these former employees, while other retrenched staff got their dues.

Judges Paul Kariuki, Kathurima M’Inoti and Jamila Mohammed said it was evident the company discriminated against the 997 employees and directed that each be paid two-and-a-half months’ severance pay for each year worked, as well as a golden handshake of Sh150,000 each.

When calculated, the ex-employees were to get between Sh900,000 and Sh3.5 million severance allowance depending on the salary scale at the time of retrenchment and the number of years worked.

The case will be heard on May 12.