Massmart Holdings, a retail and wholesale conglomerate founded by South African retail mogul Mark Lamberti, signed an agreement with its former employees as part of its exit from the Kenyan market last week.
“The agreement is in full and final settlement of any and all claims or disputes between the parties regarding the termination of employment regarding any associate, redundancy pay, severance pay, notice pay, leave pay, or any other terminal benefit or term and condition of employment, regardless of whether such claims or disputes,” Massmart stated in a notice.
The retailer agreed to pay a one-time relocation fee of Ksh35,000 ($284) per person as part of its exit agreement with the former employees, which marks the end of the group’s Game Stores operation in Kenya.
In addition to the one-time relocation fee, the group agreed to pay one month’s notice pay to employees who have been with the retailer for less than five years, and two months’ notice pay to employees who have been with the company for less than five years.
The company will also pay a 15-day gratuity for every year of service, as outlined in the Collective Bargaining Agreement between the company and the Kenya Union of Commercial Food and Allied Workers, which was advocating for a better redundancy package.
The workers and the union had made a series of demands for additional pay, including a severance package of 30 days’ pay for every year worked. However, Massmart rejected these demands, claiming that it could not afford them due to financial constraints.
Founded by Lamberti, one of South Africa’s leading businessmen, more than three decades ago, Massmart is the continent’s second-largest distributor of consumer products and a leading retailer of general commodities, alcohol, home improvement equipment, and basic foods.
More than three months ago, it announced plans to close its Game Stores operations in East and West Africa, following an unsuccessful attempt to find domestic buyers to restructure its operations and reduce exposure to lossmaking stores.
