Kenya: South African video game retailers to leave Kenya in December
Nairobi – South African retailer Massmart which runs gaming stores will close its Kenyan stores on or around December 25, putting hundreds of people out of work.
In a letter to the Kenya Union of Commercial Food and Allied Workers (“the Union”), the Johannesburg Stock Exchange-listed company says it has informed all of its associates and employees of the impending closure.
A copy of the notice was also forwarded to the labor officer.
As a result, the company issued a one-month dismissal in accordance with Article 40 of the Employment Act.
“As you are aware, on October 4, 2022, the company sent notices to all associates and the Kenya Union of Commercial Food and Allied Workers (“the union”) advising them that for various reasons, the company is proposing to close all stores in Kenya. “,
“A copy of the notice was also given to the labor officer. Following the proposed store closures, the company gave associates and the union one month’s notice of termination pursuant to Section 40 of the Employment Act,” Hassan Van Wyk Senior ER Specialist said in a statement.
Last year, the retailer announced plans to sell three stores in Kenya to focus on its core strengths.
It has also initiated exit plans in Nigeria (five stores), Ghana (4 stores), Uganda (1 store) and Tanzania (1 store).
“We came to the conclusion that the performance and complexity of running the 14 stores across five markets in East and West Africa is something we need to frankly address,” said the Managing Director of Massmart, Mitchell Slape, during the group’s virtual financial results presentation last year.
Earlier this month, Massmart entered discussions with employees over closure plans after failing to sell the local unit as well as in Uganda, Tanzania, Ghana and Nigeria.
The shutdown will put hundreds of Kenyans out of work, at a time when unemployment in the country is very high.
Massmart is owned by US retail giant Walmart. It first entered Kenya with Game Stores in 2015, at Garden City Mall. He then opened other stores at Waterfront in Karen and Mega City Mall in Kisumu.
Gambling stores sell fast moving consumer goods (FMCG) as well as non-perishable groceries in many African countries.
South African companies have struggled to break into the Kenyan market, prompting brands like magazine publisher Media24, home goods store Supreme Furniture, among others.
The company has invited the union and representatives to discuss with it severance payments and whether there are ways to mitigate the adverse effects of the dismissal.
“We confirm that we have received a proposal from the non-union representatives and that we will meet with them to discuss the proposals they have made”,
“We are also asking the union to provide us with their proposals regarding termination benefits and whether there are ways to mitigate the adverse effects of the dismissal by Monday October 30, 2022 at the latest so that we can set a time with them. to discuss their proposal.