Capital FM Stops Planned Salary Cuts To Employees

Capital FM employees will be smiling to the bank this festive season after the station announced that it will not impose the salary reductions it had proposed from December 2022.

In a letter to staff seen by Viral Tea dated December 2, 2022, Capital Group Director Mary-Ann Musangi revealed that the media house will not trim the monthly pay to its staff, including journalists and radio presenters working at the station. 

Musangi, the daughter of the late businessman Chris Kirubi, disclosed that she had spoken to a select number of employees who were attending the Strategy session, regarding the notice sent out on salary reductions on November 11, 2022.

Capital Group Director Mary-Ann Musangi. /FILE

Musangi in the meeting had highlighted the grim financial situation that has been affecting its operations, revealing the losses it had made stretching as far back as 2018.

"In the meeting, I presented the Company's Financials and highlighted the difficulty we are facing in keeping the business afloat.

"From 2018 to date, the company has been making losses and our liabilities far exceed the revenues we have generated. The situation is so dire that we are not able to meet some of our critical financial obligations," she wrote in part.

Capital Group had in July 2020 engaged in a similar salary reduction exercise as an alternative to laying off its staff en masse in company reforms to ensure that none of its employees was left without a job.

In early 2022, its revenues started to improve, leading to the reinstatement of full salary pay in April 2022 based on the continued growth of revenues enabling 100 per cent salary pay - a commitment the staff made to each other.

"Unfortunately, this action of reinstating 100 per cent salary did not motivate the staff to continue driving the revenue targets and we have since witnessed a further slump in revenues which has put the company deeper in the red.

"The reality is that even after engaging in consultation with employees, only 7 members of staff out of 112 have consented to the proposed salary reductions. We are therefore unable to gain traction with this proposal put forward and in compliance with the Employment Act, we are left with no option but to defer the proposal and radically rethink the future of our business," she added.

Musangi reaffirmed that the company is in huge financial difficulty and cannot continue to operate under the current conditions.

The options moving forward, she said, will involve a restructuring of the business but the group would inform its employees regarding the next steps once it has defined the way forward.

In 2020, the station ended the Hits Not Homework show that had been airing every Monday to Thursday evening from 7 pm to 10 pm for the last 20 years and has since replaced it with The Hype show on Tuesday, December 1, at 7 pm, now hosted by Wanjira Longauer.

Meanwhile, the crisis sweeping Kenyan media houses saw Capital Group's competitor, Radio Africa, announce on Friday, December 9 that it intends to fire many of its staff in a restructuring exercise.

According to RAG Group CEO Patrick Quarcoo, the move was informed by a shift in the media environment that has forced it to make changes to its business model to keep it in competition with other media houses in the country.