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KFC, Pizza Hut closure against Labour Act: Employees

Employees of KFC and Pizza Hut asked Devyani International – the local franchisee of the two international food chains – to resume operations of the food chain as soon as possible.
Organising a press meet here in Kathmandu today, members of All Nepal Revolutionary Hotel and Restaurant Workers Union of Devyani International said that the abrupt decision to shut operation of KFC and Pizza Hut outlets was against the Labour Act of Nepal.
Devyani International director Rohit Kohli yesterday has informed that RJ Corporation –the parent company of Devyani International – has decided to shut KFC and Pizza Hut outlets in Nepal with immediate effect due to labour issues.
However, KFC and Pizza Hut outlets at Durbar Marg and Blue Bird Mall, Thapathali have
shut down all four restaurants being operated in the capital for indefinite period – citing labour union members trouble with a senior management team member in front of the customers – from May 11.
“We have heard that the management has decided to shut KFC and Pizza Hut outlets in Nepal,” ” Keshav Bhujel, secretary of the union, said, clarifying that the employees have nothing to do with the abrupt closure of the foodchains. “The decision to shut down KFC and Pizza Hut outlets is the result of growing conflict between management teams of Devyani International and Varun Beverages.”
Varun Beverage – a sister concern of RJ Corporation – is the bottler of PepsiCo products in Nepal. Even as Devyani International Nepal has not formally started any of the necessary procedures with the Office of Company Registrar and Department of Industry to dissolve the company, its decision to transfer senior managers and other internal homework point toward the possibility of the firm shutting up shop.
“We have come to know that the management of Varun Beverages is interfering the daily works of Devyani International,” president of the union Sita Ram BK said, adding that the decision to shut KFC and Pizza Hut was against the Labour Act of Nepal. “If the management had problem with employees, it should have come to us.”
The management of Devyani International had recently transferred 16 managers working with KFC and Pizza Hut to outlets in India going against the company rule, he said, urging all stakeholders to do the needful for resuming operations of KFC and Pizza Hut.
“There had been confrontations between the union members and the management time and again regarding salary increment and transport facilities, but there was no such incident as the management has alleged on May 11, BK claimed, adding that it was unfair for the management to unilaterally shut down the restaurants without informing the labourers during this turbulent time following the devastating earthquake of April 25.
Devyani International was operating two restaurants at Durbarmarg since 2009. In 2012, it added two more outlets at BlueBird Mall in Tripureshwor.
It has been employing some 155 individuals before the closure. The daily turnover from the four restaurants was around Rs 1 million, according to finance head of Devyani International Nepal Santosh Jha.
He also threatened to announce protest programmes, if the outlets do not resume operations soon.