Fenaka Corporation to let go of contract employees this month

State owned utility service provider Fenaka Corporation Limited has announced that the company will be letting go of all contract employees hired to work on projects in the islands.

Last December, Fenaka said that the company would not be renewing the contracts of employees who do not have work assigned to them.

Fenaka said that during former president Ibrahim Mohamed Solih's administration, the company had hired 2,000 employees for special tasks. However, 1,800 of these employees were brought on for small projects, they said.

A senior official of the company said that 731 employees were hired for the construction of power plants and office buildings. They also added that they still paid all employees although these projects were halted when the new government took over on November 17, 2023.

According to Fenaka a total of MVR seven to nine million goes towards the salaries of contract employees each month. However, the company's financial situation no longer allows this expense to continue, which is why they have decided to let go of contract employees, the official said.

Moving forward, the company will be hiring third parties for such projects, instead of directly hiring employees, they said. As such, the company has already made announcements seeking contractors for several projects.

The official said that projects always have a set budget and duration, but that they have decided to not hire further contract employees due to a lack of funds.

"[If] we recruit employees, we have to bear all the expenses, for example, salaries, allowances and other benefits. Instead, it is much more profitable if we hire contractors for the job," the official said.

"Before the presidential election, 99 percent of the projects were halted. We implemented the necessary changes to resume these projects and released all staff previously assigned to the halted projects."

Fenaka also said that the company lacks the facilities required to run these projects, leading them to lease the necessary machinery. However, delays in payments have resulted in some companies protesting against Fenaka as well.

Fenaka decides not to renew some contractual staff agreements

The Edition