Jubilee Holdings #ticker:JUB is set to lay off 52 employees as it completes splitting of its insurance businesses in Kenya to increase efficiency and management focus.
The firm announced on Thursday that the decision has been reached after an independent human resources consultant conducted a detailed staff talent mapping and organisational structure to suit the new arrangement.
The separation has led to creation of two new companies — Jubilee Health Insurance Limited (offering medical covers) and Jubilee General Insurance Limited (offering general insurance covers).
Jubilee Insurance Company of Kenya Limited (JICKL), the subsidiary which previously housed all of the insurance businesses, will now focus on long-term products including life and pensions.
“Opportunities for increased operational efficiency were identified, including the realignment of JICK’s human resource talent base in line with the operational needs of the new companies,” the insurer said in a statement.
“As a consequence it has been determined that 52 roles, representing 8.2 percent of the 628 full time positions, will be offered redundancy.”
Group Chairman Nizar Juma said the affected staff will be paid a salary up to the end of the month, any outstanding earned but unutilised leave days, one month salary in lieu of notice, and severance pay of 15 days for every year of completed service.
“All the exiting employees and their dependents will remain entitled to their medical insurance benefits for the next three months, as well as access to counselling services arranged through a firm that specialises in employee welfare,” added Mr Juma.
The company will also pay one month’s salary and pro-rata severance pay for any partial year of service.
The development comes at a time Jubilee’s earnings have come under pressure. In the year ended December 2018, it failed to grow profits for the first time in 12 years. Its half year net profit to June 2019 dropped marginally to Sh1.83 billion from Sh1.86 billion.
The layoffs deepen the job crises in the corporate Kenya given that many other firms that have also implemented significant retrenchments.
Other firms that have announced or completed layoffs over the past one year include Sameer Africa, Sportpesa, Betin, East African Portland Cement Company, Telkom Kenya, Stanbic Bank of Kenya and East African Breweries Limited.
Others are Ola Energy, Sanlam, Stanbic bank, MediaMax, Radio Africa, Tala, Silverstone Air Services and Securex Agencies.