According to two former employees who spoke with TechCabal, Kenya-based e-commerce company Wasoko started a covert merger with Egypt’s MaxAB, keeping their plans a secret from staff for more than six months to avoid any leaks that would compromise the agreement. Within the organization, there was debate about the merger, which was scheduled to close by the end of March 2024.
When Wasoko was founded in 2013, it already had over $140 million in funding from well-known backers, including 4DX Ventures and Avenir Growth Capital. However, many staff were taken aback when the merger with MaxAB was announced in early December 2023 over a video conference that MaxAB management was present for.
Even though there had been rumors of a merger among the workforce, many were shocked by the sudden news. Then, on January 15, 2024, Wasoko started a round of mass layoffs that terminated more than 100 workers from various departments in Kenya and India, including business intelligence, product development, and engineering.
Nine former employees filed a complaint against Wasoko, claiming they were fired unfairly due to the quick layoffs. They said the pay structure favored long-tenured employees, and the corporation did not provide sufficient notice or severance pay.
The severance payment, which considered the employee’s length of service, accumulated vacation time, and departure date, was criticized for being biased in favor of senior employees. As a result, Wasoko was prohibited by a court decision from firing the nine workers until additional legal action was taken.
In addition, a few impacted workers voiced worries about their debts since they had taken out loans under the mistaken impression that their jobs at the online retailer would be safe. Wasoko offered to postpone loan repayments for six months and promised to discuss this matter with Standard Chartered, their banking partner. According to the company’s assurance, the impacted employees’ health insurance coverage would also be maintained until March 2024.
Wasoko confirmed in a statement that the redundancy procedures would begin on December 5, 2023, as initially promised, in response to questions from TechCabal. The business reaffirmed its commitment to offering required severance payments and declared compliance with all applicable labor rules.
Wasoko cited pending legal processes in refusing to comment on specific charges. The merger’s aftermath and the ensuing layoffs highlight the difficulties and complexities of corporate restructuring, entangling the corporation and its workers in a bitter legal dispute.