With approximately 8,000 employees costing nearly MVR 90m every month, this is no longer a sustainable burden: Fenaka MD

Fenaka Corporation Limited’s Managing Director, Mohamed Afeef Hussain, has stated that the company’s current payroll of approximately 8,000 employees is unsustainable, with monthly salary expenditures reaching nearly MVR 90 million.

Speaking on state media, Afeef stated that Fenaka Corporation currently maintains an excessively large workforce, with approximately 8,000 employees on its payroll. He noted that the company must spend roughly MVR 90 million each month on staff-related costs, describing this as an unsustainable financial burden for the utility provider. Afeef further highlighted that these personnel expenses significantly exceed the total monthly revenue generated from providing electricity and water services to the public.

Addressing the staff situation, Afeef noted that the company currently employs individuals who have no assigned duties, as well as those who remain active within the organization without following standard attendance procedures, such as clocking in. He further stated that such employees are present both at Fenaka’s head office and across its various regional branches.

Consequently, we have identified significant challenges in managing the funds required for staff salaries and related expenses, as well as the procurement of fuel and spare parts necessary for engine operations and other essential overheads. It has become clear to me that addressing these issues is an absolute necessity. At this stage, I cannot proceed without implementing these reforms. Furthermore, it was observed that some employees at various atoll branches, as well as at the head office in Malé, lack sufficient daily tasks to perform. This observation regarding underutilized staff was noted across several branches, not just within the Malé office.

Fenaka Managing Director Mohamed Afeef Hussain

Afeef noted that while staff had been recruited for various projects, many remain in those positions despite the projects being stalled due to a lack of necessary resources or other factors. He further stated that these employees have continued to receive salaries for two to three years, despite there being no work for them to perform.

Afeef stated that due to numerous such factors, the company is currently operating at a significant loss and must be salvaged. He emphasized that to stabilize and advance Fenaka, it is necessary to reduce the workforce.

In the past, employees hired for specific projects remained on the payroll for two to three years even when those projects were stalled due to a lack of resources or other reasons. During these periods, these staff members had no active work to perform. Furthermore, many of these individuals lacked the necessary expertise to be reassigned to technical duties or security roles in various locations. This lack of technical experience among certain staff members has presented significant challenges, yet they continue to remain on our payroll. Consequently, we are now compelled to right-size the company. We are currently conducting an assessment to determine the exact number of personnel required for each branch, as well as every division, department, section, and unit within the head office. This evaluation process is now underway.

Fenaka Managing Director Mohamed Afeef Hussain

Fenaka’s MD made these remarks as the company continues its efforts to downsize its workforce. As part of this initiative, employees have been offered a voluntary redundancy package, allowing them to resign with four months' salary. The application window for this scheme opened on the 3rd of this month and will remain available until the 14th.

While this represents a significant hardship for employees, complaints have mounted against President Dr. Mohamed Muizzu’s administration for conducting large-scale recruitment drives synchronized with election periods.

In the lead-up to the Local Council Elections, Women's Development Committee Elections, and the Referendum held on April 4, Fenaka Corporation created hundreds of jobs across various islands. These positions were reportedly established as a strategic move to secure a majority for the government. However, following the government's significant defeat in the elections, there has been a surge in reports of numerous employees being dismissed from their posts.

Furthermore, amid allegations of corruption involving successive managements at Fenaka, many citizens have noted that these actions are hindering the company's ability to provide essential services. A bloated workforce combined with systemic corruption has plunged Fenaka Corporation into significant debt, leaving its financial standing in a state of severe decline.