A section of The Postal Corporation of Kenya employees is set to face job losses in the wake of the company's latest cost-cutting measures.

The decision, aimed at addressing dwindling revenues, will result in the retrenchment of 504 employees in February 2024.

The move is part of the Postal Corporation's ongoing efforts to streamline its operations and reduce overhead costs.

The State corporation, which has been grappling with financial challenges, currently employs 2,364 individuals.

Following this retrenchment, it will retain 1,860 employees on its payroll, aligning its staff size with what has been determined as the optimal staffing levels.

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PCK's Postmaster-General and Chief Executive Officer, John Tonui, confirmed the plan, saying, "We will be sending home 504 workers in February next year. The plan has been approved by our parent ministry."

This move is part of the broader strategy to make the organization more efficient and cost-effective.

According to the corporation, the restructuring exercise, which is expected to cost the corporation Sh1 billion, will involve a careful evaluation of factors such as age, skill sets, and staff competency to determine the employees who will be affected.

The objective is to retain a lean and efficient workforce, ensuring that the staff members retained possess the skills required to drive the corporation forward.

The decision to reduce the workforce comes in the wake of PCK's continuous struggle to maintain its viability in a rapidly evolving market.

The Postal Corporation of Kenya has experienced a decline in its traditional mail and parcel delivery business due to increased competition from new players and the expansion of digital communication channels.

Tonui, who assumed leadership of PCK in February 2023, explained the rationale behind the move, stating, "Our current staff numbers stand at 2,364, and we need 1,860, which makes the optimal staffing levels. This means we need a lean and efficient staff."

The corporation says the reduction in the workforce is essential to address its financial woes and ensure its sustainability.

Once the retrenchment is completed, the Postal Corporation of Kenya is expected to experience significant savings in its monthly payroll expenses.

The cost will be reduced from the current Sh122 million to Sh70 million per month, as per the approved turnaround plan.

Moreover, PCK believes the downsizing will enable it to address pressing financial obligations, including the payment of accumulated salaries in arrears, which currently amounts to a staffering Sh530 million.

Acknowledging the challenges faced by the parastatal, the government has granted permission to downsize its workforce and transition some employees to short-term contracts, marking a significant step as the corporation endeavours to reverse the trend of plummeting revenues and profits.

The aim is to position the Postal Corporation of Kenya for a more sustainable and competitive future, leveraging lean and proficient staff.