This archive report was first published on 3 December 2019.
Sanlam Kenya has initiated a voluntary early retirement (VER) program, resulting in the departure of 19 employees. The program targets staff above 50 years, with the initial sign-up of 20 staff members drawn from various cross-functions within the organization.
The move aims to reduce operational costs by Ksh.200 million annually, with the firm expecting to close the layoff process by the end of the year. Sanlam Kenya has assured that it will not be seeking further retrenchments in the short term.
Exiting staffers are entitled to benefits, including a 30% discount on existing loans accruing back to Sanlam and the payment of a month's salary for every three years of service. The insurer's voluntary redundancy program was implemented following a net loss of Ksh.1.97 billion in 2018, largely due to the impairment of its corporate bond investments.
Staff costs represented 52.8% of the firm's total operating costs in 2018, amounting to Ksh.942.8 million. Compensation to exiting staffers will feature in the firm's full-year balance sheet as a one-time cost.
Sanlam Kenya's move follows a similar employee rationalization plan implemented by Stanbic Bank, which let go of 88 senior employees through VER for a cost of Ksh.773.2 million.
