Following commencement of insolvency proceedings, ailing telcom firm Rwandatel has laid off 43.2 percent of its workforce as part of a company-wide restructuring process, the goal of which is to keep operating costs low and to operate with an optimum number of employees.
Rwanda’s utilities regulatory agency RURA withdrew Rwandatel’s GSM Mobile license in April this year and within weeks, the Office of the Registrar General had instituted insolvency proceedings against the company.
The commercial court in Kigali then appointed an administrator to take charge of the company who within a period of two months will advise Court if the company could be turned around or face possible liquidation.
Operating both its GSM Mobile and Fixed licenses, Rwandatel had a total workforce of 317 employees. Out of these, only 180 have been retained to run its remaining voice, internet and data services all of which run on the fixed network platform.
Rwandatel’s court appointed administrator Richard Mugisha, said, “In these times when the company is trying to reorganise itself to run its fixed network operation, reducing employees is sad but it has to be done to keep the company afloat. Management must respond by reducing costs and realigning its workforce. As such, we have had to place 137 on technical redundancy as there isn’t sufficient business to justify such a huge workforce. As administration, we shall pay the laid off staff terminal benefits as stipulated in the law”.
“I feel it is critical to make very difficult adjustments at this time, to address the company’s current reality and to prepare the company for potential success in the future”, Mugisha added.
Despite these recent developments, the company continues to offer the ever vital voice, internet and data services to individuals and businesses alike.
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