Why SportPesa has recalled ex-staff for meeting today

The sacked employees of betting firm SportPesa are today (Friday) expected back to the firm’s head office in the capital Nairobi.

However, it will still be a walk of pain because their employer is not calling them for new job offers but redundancy notices.

On Thursday, the company’s head of human resource Terry Wanja Njagi sent an email to the ex-staff advising them to report at Chancery Building on Valley Road on Friday so that the termination notices issued to them on October 2, 2019 can be withdrawn.

NEXT STEP

The firm also told the ex-workers that after the withdrawal of the notices they will be informed of the “next step”.

When the Nation reached the firm’s CEO Ronald Karauri to establish if the move meant that the ex-employees might get back their jobs soon, he gave a terse answer: “No comment, no comment.”
But on Thursday he was quoted by a local daily as saying that SportPesa decided to call the employees after being advised to “issue proper and legal notices even as we wait for the Betting Control and Licensing Board to act on our application.”

This meant that the betting company that controlled close to 60 per cent of the market share is still optimistic its will get back its operating licence.

The permit was withdrawn in July after the firm allegedly failed to remit Sh14 billion in tax arrears to Kenya Revenue Authority.

But the some of the 400 plus employees whose services were terminated were hopeful that the issues will be sorted out so that the can get back their jobs.

On October 2, Sportpesa announced that it had halted operations in Kenya due to what it termed as “tough regulations”, including higher taxation and tough advertising guidelines.

Before it closed, the company had been out of business for nearly three months after the government suspended its pay bill numbers.

SportPesa expressed disappointment at the government’s move to impose a 20 per cent excise tax on all betting stakes on top of the 20 percent on customer winnings.

“The economic incentive to place bets will be completely removed as the taxes will deprive consumers of their total winnings and will halt all investments in sports in Kenya,” the company statement read.

HIGH TAXES

The firm has, however reportedly said it would “consider returning to the market if provided with adequate taxation and a non-hostile regulatory environment.

The company’s annual revenues are estimated at Sh100 billion, although its management says it makes only Sh20 billion.

The closure of the betting company, alongside its rival Betin, send shock waves in the sports and media industries.

The company stopped sponsorships to clubs and the Kenya Premier League, which are already facing financial problems.

Clubs such as KPL reigning champions Gor Mahia have been hit hard, forcing the government to bail it out occasionally to enable it honour its continental fixtures.

On Thursday the government, through the sports ministry, had to buy Gor Mahia air tickets to Kinshasa in DRC for a return match against DC Motema Pembe in their CAF return leg on Sunday.

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