The Kenyan economy continues to roll into an abyss with Botswana-owned retail chain Choppies laying off 583 across its branches in Kenya.
The retail chain has in the past few months been struggling to stay afloat amid a cash crunch that has hit major Kenyan enterprises.
Choppies according to Business Daily sent home 486 workers last year in November and a further 97 called it quits.
In the matter that is now before the court between Choppies and Kenya Union of Commercial Food and Allied Workers, the retailer has a hard time convincing the fired workers that it will settle their dues before exiting the Kenyan market.
The case lodged by the Kenyan Union of Commercial Food and Allied Workers wants the court to compel Choppies to settle all dues owned to its fired employees before closing shop in Kenya.
“486 employees were declared redundant by a notice dated November 15, 2019…51 employees were declared redundant at Nanyuki by notice dated October 31, 2019, while 46 employees exited employment for other reasons other than redundancy,” part of the court documents read.
The 583 workers who have left Choppies account for 72 percent of the retail’s unionisable workers who total up to 799.
In 2019, Choppies publicly announced plans to sell more than 15 of its stores across the country in a bid to stay afloat in the seeming competitive retail market. This came a few years after the Botswana retailer acquired Ukwala supermarkets across East Africa for Sh1 billion but the rising cost of operation has led to the closure of a significant number of stores.
The retailer which is a listed company in Johannesburg broke the ice to the investors of its incapacity to access loans as it has written off Sh1.6 billion in its local subsidiary.
This lead to a loss of Sh248.7 million for the year 2018.
In the last year, it heavily relied on credit including Sh300 million loan from Absa Kenya formerly known as Barclays Bank.