The economic crisis which engulfed the world a couple of years back have appeared in Pakistan. The weakening economy is leaving its mark in every sector and the worst hit seems to be the Karachi Electric Supply Corporation (KESC) which was already a victim of corruption and a house of ‘ghost employees’ until the then President General Musharraf privatized the utility company to provide uninterrupted electricity to Karachites. The KESC fulfilled its promise and restructured the organization on revolutionary lines, from lodging FIRs against the electricity thieves to reducing the load shedding hours as less as 3 hours (comparing with rest of the nation facing more than 10 hours of load shedding). KESC took all necessary measures to turn the white elephant into productive organization.
In an attempt to continue with restructuring and to make the company financially viable the KESC has decided to get rid of those employees who considered burden on organization as a result KESC is forced to lay off 4,000 of its unproductive workers, while 500 employees opted for Voluntarily Separation Scheme (VSS) under a cost-cutting drive. Most of the lay-off workers were from five different categories – security guards, bill distributors, sanitary workers, drivers and clerical workers who are offered one month’s advance salary and gratuity benefits as a result Collective bargaining agents and union leaders have rejected the policy and opted to confront the management by all means.
With the passing days the KESC’s turmoil is increasing and the situation is getting more and more complex especially the scenario at the KESC Head office which is surrounded by a huge mob of sacked employees and their sympathizers representing the banners of several political parties. The live media coverage has managed to gain the support of the ill informed people of Pakistan who think in favor of the sacked employees considered as a liability by the utility company.
Indeed KESC is not an employment bureau however in a highly polarized country like Pakistan where political parties literally find issues to exploit and make maximum benefit out of them; corporate likes KESC should have conscientiously handled this particular issue foreseeing the post decision chaos. At this point in time mass downsizing would be an unwise step by the company when the country’s economic situation is alarming and Government and all other political parties are trying to capitalize issues for gaining public sympathy.
KESC’s step looks impudent, and the situation doesn’t seem to go in the favor of their decision to lay off the employees. Instead they must come up with “safe strategy” which could be implemented to achieve the objectives gradually. The company should pursuit the policy of downsizing but in a subtle and planned way which will leave very less scope for the labor unions to strengthen.
As an alternative, the company should also revise the appraisals policy which could be determined by company’s profit or productivity measures.
After restoration, all employees should be systematically included in the part of wage reduction program. It would not be fair to slash the wages of entry-level or non-management recruits only, such decisions will further spur discontentment among employees who were initially being targeted. However as soon as the wages are reduced with no security of appraisals, the non performing staff already working on less wages would definitely look for the soon-to-expire- lucrative Voluntarily Separation Scheme (VSS).
In short the company should devise a smart strategy to divide workers unions with cost reduction plans which will definitely help KESC achieve productivity and its objectives in long term.