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MEMORANDUM OF AGREEMENT Between SHAMCO INDUSTRIES LIMITED And KENYA ENGINEERING WORKERS’ UNION IN THE MATTER OF WAGES AND OTHER TERMS AND CONDITIONS OF SERVICE

PREAMBLE:

The Company and the Union meeting together in free heart and voluntary association agree and enter into this agreement in matters of wages and other conditions of service and shall apply to all unionisable employees

PART I: BASIC MONTHLY MINIMUM WAGES

(a) Every employee shall be paid a house allowance of 4,500/- (1st year) and Kshs.4,550/- (2nd year) shillings every month.

1st Year 11% (Kshs) 2nd Year 10% (Kshs)
Grade 1: (UNSKILLED WORKERS)
General Labourer

Cleaner, Tea maker, Loader

Driver’s mate, packer

12,087/- 13,296/-
Grade 2: (SEMI SKILLED WORKERS)

Machine Attendant, Assemblers,

Riveter, Grinder

13,700/- 15,070/-
Grade 3: (UNGRADED ARTISANS)

Welder, machine operator, fitter

Spray painter, Turner, Electrician,

Machine tool operator

Spring Makers

16,316/- 17,948/-
Grade 4: (DRIVERS)

(i) Cars and light van

(ii) Medium sized vehicle

(iii) Heavy commercial vehicle

16,316/-

20517/-

27,277/-

17,948/-

22,569/-

30,005/-

Grade 5: (GRADED ARTISAN)
(i) TTC Grade III

(ii) TTC Grade II

(iii) TTC Grade I

20,517/-

22,651/-

27,277/-

22,569/-

24,916/-

30,005/-

Grade 6: (SPECIAL GRADE)
i) Supervisor/charge Hand

(ii) Diploma

(iii) Degree

27,443/-

28,720/-

31,455/-

30,187/-

31,592/-

34,601/-

Grade 7
Copy Typist 18,767/- 20,643/-

(b) An employee who is in service on 01-05-2013 shall be given a general wage increase of 11% to cover the first twelve months. Every employee shall get a further 10% wage increase to cover the next 12 succeeding months.

PART II. OTHER TERMS AND CONDITIONS OF SERVICE

1. PROBATION

All employees shall be considered to be on probation for a period not exceeding three months from the date of engagement and during this period services may be terminable by either party by giving 48 hours notice or pay in-lieu during the 1st month, and 7 days notice or pay in-lieu during the 2nd month and 14 days notice or pay in lieu during the 3rd month.

2. HOURS OF WORK

The normal working week shall consist of 45 hours to be spread over not more than 6 days of the week.

3. OVERTIME

Overtime shall be payable for time worked in excess of the normal number of hours per week and for time worked on Sundays and Gazetted Public Holidays at the following rates:

(a) Monday to Saturday - 1½ times the normal hourly rate.

(b) Sunday and Gazetted Public holidays – Twice the normal hourly rate.

4. GAZETTED PUBLIC HOLIDAYS

All Gazetted Public Holidays will be granted as days off with full pay.

5. ANNUAL LEAVE

(a) After the completion of each period of twelve months continuous service with the Company, an employee shall be entitled to annual leave covering a period of twenty six (26) working days (exclusive of rest days and gazetted public holidays) with full pay.

(b) Where employment is terminated after the completion of two or more months continuous service during any twelve months leave earning period, an employee shall be entitled to leave with full pay which is proportional to the part of the leave earning which has been completed.

6. LEAVE TRAVELLING ALLOWANCE

After each period of twelve months’ continuous service with the company an employee shall be entitled, when proceeding on annual leave, to a travelling allowance of Ksh.4,250/- (1st year) and Kshs.4,350/- (2nd year).

7. COMPASSIONATE LEAVE

(a) An employee desirous of taking leave on compassionate grounds shall, by prior arrangements with the company be granted such leave up to his earned entitlement under Clause 5 of Part II of this Agreement and, the leave taken shall be subsequently set off against his annual leave.

(b) An employee may, in addition to the leave provided for in paragraph (a) of this Clause be granted upto 5 days compassionate leave without pay in any period of twelve months.

8. PROMOTION

When vacancies of promotional nature arise, the Company shall give first priority to existing employees having regard to qualifications, length of service, experience, ability etc

9. ACTING ALLOWANCE

Where an employee is required to work in full acting capacity for a period of not less than 14 days in an occupation or grade for which the minimum wage prescribed under Part I of this Agreement is higher than the wage normally earned by the employee, he shall be paid acting allowance at a rate not less than the difference between such minimum wage and his normal wage.

10. SICK LEAVE

After twelve weeks of continuous service with the Company, an employee shall be entitled to sick leave (in each period of twelve months consecutive service) with full pay upto a maximum of forty four (44) days and thereafter to sick leave with half pay upto a maximum of forty four (44) days.

Provided that:-

(a) An employee shall not be entitled to such payment unless he/she produces to the company, a certificate of incapacity covering the period of sick leave claimed, signed by a medical practitioner in charge of a dispensary or medical aid centre, or by a person authorised by him in writing and acting on his behalf;

(b) An employee shall not be eligible for sick leave under this clause in respect of any incapacity due to gross neglect on his part.

11. OVERALLS AND PROTECTIVE DEVICES

(a) Employees (other than office staff) will be provided with a pair of overalls or aprons by the Company once a year.

(b) Overalls or aprons shall remain the Company’s property.

(c) The Company shall provide a bar of soap per month to any employee issued with overalls or aprons for washing them.

(d) An employee provided with overalls or aprons shall keep such overalls or aprons in clean condition.

(e) Overalls or aprons shall be replaced by the Company annually.

(f) Gas masks or helmets will be provided to employees in accordance with the terms of the Occupational Safety and Health Act.

12. REDUNDANCY

Where the employment of an employee is to be terminated on account of redundancy, the following procedure will be followed:-

a) The union shall be consulted on the reasons for, and the extent of the intended redundancy;

b) The principle of “LAST IN, FIRST OUT” shall be followed in the particular category of employees affected subject to all other factors such as skill, ability, relative merit and reliability being equal;

c) Any leave due to any employee who is declared redundant shall be paid for in cash;

d) The redundant employee shall be entitled to appropriate notice in accordance with Clause 14 of this agreement;

e) Employees with up to 10 years service shall be entitled to severance pay at the rate of twenty five (25) days pay for each completed year of service while those with over 10 years service shall be entitled to twenty seven (27) days pay for each completed year of service.

13. WARNING PROCEDURE

An employee whose work or conduct is unsatisfactory or who commits a default which in the opinion of the company, does not warrant instant dismissal shall be warned in writing and the following procedure shall apply;-

(a) The first and second warnings shall be entered on the employees record card/file and the shopsteward shall be informed;

(b) Warnings shall first be given verbally and confirmed in writing

(c) The second warning shall be copied to the union’s Nairobi Branch Secretary;

(d) If an employee who has received two warnings commits a third default within 365 consecutive days from the date of the second warning, such employee’s service will be terminated by one month’s notice or pay in lieu as provided for by the termination of service Clause of this Agreement.

(e) If an employee completes 365 consecutive days from the date of the first or second warning without further default, any warnings recorded on employment record card/file shall be cancelled.

14. TERMINATION OF EMPLOYMENT

(a) Employment is terminable by either party by giving the following notice in writing or pay in lieu.

(i) After probation and up to 10 years service-One month’s notice or pay in lieu

(ii) Over 10 years service-Two months notice or pay in lieu of

Notice

Provided that:-

(b) Nothing in paragraph (a) of this Clause shall prejudice the right of either party to terminate employment summarily for a lawful cause.

15. MEDICAL TREATMENT

The Company undertakes to pay the cost of such medical treatment and medical expenses in accordance with the provisions prescribed by the Laws of Kenya relative to Employment of Persons Medical Treatment Rules. The payment of medical expenses will be made to all employees of the Company, provided that such illness are those covered by the Act, and treatment carried out in Government Hospitals or Local Authority Health Centres.

16. CERTIFICATE OF SERVICE

(1) Every employee shall be given a certificate of service by his employer upon the termination of his employment, unless such employment has continued for a period of less than four consecutive weeks, and every such certificate shall contain:

(a) The name of the employer and his postal address

(b) The name of the employee

(c) The date when employment commenced

(d) The nature and usual place of employment

(e) The date when employment ceased; and

(f) Such other particulars as may be prescribed

(2) Subject to subsection (1) of this section, no employer is bound to give to any employee any testimonial, reference or certificate relating to character or performance of an employee.

(3) Any employer who wilfully or by neglect fails to give an employee a certificate of service in accordance with subsection (1) of this section, or who in a certificate of service includes a statement which he knows to be false, shall be guilty of an offence.

17. DEATH OF EMPLOYEE

(1) When the death of an employee from any cause whatsoever, is brought to the notice, or comes to the knowledge of his employer, the employer shall, as soon as practicable thereafter, give notice thereof in the prescribed form to the Occupational Safety and Health Officer or if there is no OSH Officer, to the County Commissioner of the District in which the employee was employed.

(2) The employer shall pay to the Occupational Safety and Health Officer or County Commissioner, as the case may be, all wages due to the employee at the date of his death, and shall deliver to him all property belonging to the deceased employee for transmission to the person legally entitled thereto.

(3) Should any employee, during the course of his employment be killed, or incapacitated by injury for a period exceeding three days, his employer shall as soon as practicable send to the Occupational Safety and Health Officer or, if there is no Occupational Safety and Health Officer, to a County Commissioner a report in the prescribed form.

(4) It is agreed that the Company shall contribute a sum of Kshs.50,000/- towards funeral expenses of a dead employee for transport, mortuary fees and coffin.

18. MATERNITY LEAVE

A woman employee shall be entitled to three (3) months maternity leave with full pay and one year’s travelling allowance, when proceeding on annual leave.

Provided that a woman who has taken three months maternity leave shall not forfeit her annual leave in that year.

A male employee shall be entitled to two weeks paternity leave with full pay.

19. INJURY BY ACCIDENT DURING THE COURSE OF DUTY

In the case of accident covered by the Work Injury Benefits Act, full pay will be given to the employee as required by the Act.

20. SUMMARY DISMISSAL

Any of the following matters may amount to gross misconduct so as to justify the summary dismissal of an employee for lawful cause, but the enumeration of such matters shall not preclude an employer or an employee from respectively alleging or disputing whether the facts giving rise to the same, or whether any other matters not mentioned in this section, constitute justifiable or lawful grounds for such dismissal:-

(a) If, without leave of other lawful cause, an employee absents himself from the place proper and appointed for the performance of his work;

(b) If, during working hours, by becoming or being intoxicated an employee renders himself unwilling or incapable properly to perform his work.

(c) If an employee wilfully neglects to perform any work which was his duty to have performed, or if he carelessly and improperly performs any work which from its nature it was his duty, under his contract, to have performed carefully and properly.

(d) If, an employee uses abusive or insulting language, or behaves in a manner insulting, to his employer or to any person placed in authority over him by his employer.

(e) If an employee knowingly fails, or refuses, to obey any lawful and proper command which was within the scope of his duty to obey, issued by his employer or any person placed in authority over him by his employer.

(f) If, in the lawful exercise of any power of arrest given by or under any written law, an employee is arrested for a cognizable offence punishable by imprisonment and is not within fourteen (14) days either released on bail or on bond or otherwise lawfully set at liberty.

(g) If an employee commits, or on reasonable and sufficient grounds is suspected of having committed any criminal offence against or to the substantial detriment of his employer or otherwise his employer’s property.

21. SUPPLY OF MILK

(a) Each spray painter will be given ½ litre of milk on the day he sprays.

(b) A carpenter will be given ½ litre of milk when he performs planning jobs which involves dust

(c) Helpers will be given ½ litre of milk when they are assisting spray painters and/or carpenters in a room where fumes or dust are produced.

22. CASUAL WORKERS

An employee employed on casual basis will not remain casual for a period in excess of three continuous months, then such employee shall be made permanent. A casual worker shall be paid the consolidated minimum rate for the grade in which he/she is employed divided by 26.

23. TRAINING

An employee who is transferred to be trained for a particular job, shall be given a signed letter of appointment stating how long he would remain in training and the rate of pay he would be getting per month until he completes the training.

24. RETIREMENT BENEFITS (GRATUITY)

(a) The beneficiaries shall be employees who leave employment as a result of:-

(i) Retirement on age grounds

(ii) Retirement on Medical grounds

(iii) Death

(iv) Termination of employment at the initiate of the company for reasons other than the gross misconduct

(v) Employee resigning from employment.

(b)(i) Employees with up to 10 years service will be entitled to 23 days pay for each completed year of service.

(i) Employees with over 10 years service will be entitled to 26 days pay for each completed year of service.

(c) An employee who loses his job due to gross misconduct will not benefit from this Scheme.

25. NIGHT TRANSPORT

Employees who remain at work from 6.00 p.m will be provided with company transport or enough bus fare/transport cost to their homes.

26. SHOPSTEWARD RIGHTS

Whenever the shopstewards would be required to attend meetings and negotiations on matters regarding the company, the union shall seek permission on their behalf in writing and also give the management sufficient notice to enable them re-organise their operations.

After the Shopstewards are given permission, they would be deemed to be on duty and on full pay.

27. SUSPENSION

In the event of an employee committing a misconduct that requires investigations by the company, the employee will be suspended for a maximum of 20 days to allow investigations to be carried out. During this period, the employee will be on half pay. During the same period, the Company should make a decision either to dismiss, terminable or re-instate the employee.

Provided that:

If the investigations are being carried out by the Police or the matter is in a Court of Law, the employee will remain on suspension without pay.

28. LETTER OF APPOINTMENT AND CONFIRMATION

On engagement, an employee will be issued with a letter of appointment stating the probation period and salary accrued to the job. After successful completion of the probation period, the employee will be issued with a letter of confirmation stating the job title and salary.

29. NIGHT SHIFT ALLOWANCE

Employees working at night between 6.00 p.m and 6.00 a.m shall be paid night shift allowance at a rate of Kshs.9./- per hour.

30. EFFECTIVE DATE AND DURATION

This Agreement shall come into force on 1st May, 2013 and thereafter shall remain in force for a period of two years. After the expiry date, it shall continue in operation until it is amended by mutual agreement between the company and the Union.

SIGNED FOR AND ON BEHALF OF THE COMPANY:

.........................................................................

(B.D. PATEL)

MANAGING DIRECOTR

SIGNED FOR AND ON BEHALF OF THE UNION:

....................................................................

WYCLIFFE A. NYAMWATTA

DEPUTY GENERAL SECRETARY

.........................................................................

ERIC OCHIENG

CHIEF SHOPSTEWARD

IN THE PRESENCE OF:

..............................................

ABISAI O. AMBENGE

SENIOR EXECUTIVE OFFICER - FKE

SIGNED AT NAIROBI THIS................................. DAY OF .............................. 2013

/jan

Shamco Industries Limited - 2013

Start date: → 2013-05-01
End date: → 2015-04-30
Name industry: → Manufacturing
Public/private sector: → In the private sector
Concluded by:
Name company: → Shamco Industries Limited
Names trade unions: → Kenya Engineering Workers Union

TRAINING

Training programmes: → Yes
Apprenticeships: → No
Employer contributes to training fund for employees: → Yes

SICKNESS AND DISABILITY

Maximum for sickness pay (for 6 months): → 37 %
Maximum days for paid sickness leave: → 88 days
Provisions regarding return to work after long-term illness, e.g. cancer treatment: → 
Paid menstruation leave: → No
Pay in case of disability due to work accident: → Yes

WORK AND FAMILY ARRANGEMENTS

Maternity paid leave: → 13 weeks
Maternity paid leave restricted to 100 % of basic wage
Job security after maternity leave: → Yes
Prohibition of discrimination related to maternity: → Yes
Prohibition to oblige pregnant or breastfeeding workers to perform dangerous or unhealthy work: → 
Workplace risk assessment on the safety and health of pregnant or nursing women: → 
Availability of alternatives to dangerous or unhealthy work for pregnant or breastfeeding workers: → 
Time off for prenatal medical examinations: → 
Prohibition of screening for pregnancy before regularising non-standard workers: → 
Prohibition of screening for pregnancy before promotion: → 
Facilities for nursing mothers: → No
Employer-provided childcare facilities: → No
Employer-subsidized childcare facilities: → No
Monetary tuition/subsidy for children's education: → No
Paid leave per year in case of caring for relatives: → 5 days
Paternity paid leave: → 14 days

EMPLOYMENT CONTRACTS

Trial period duration: → 90 days
Part-time workers excluded from any provision: → 
Provisions about temporary workers: → 
Apprentices excluded from any provision: → 
Minijobs/student jobs excluded from any provision: → 

WORKING HOURS, SCHEDULES AND HOLIDAYS

Working hours per week: → 45.0
Working days per week: → 6.0
Paid annual leave: → 26.0 days
Paid annual leave: → 4.0 weeks
Paid bank holidays: → Christmas Day (25th December), Human Rights Day / Vernal Equinox Day (21st March), Army Day / Feast of the Sacred Heart/ St. Peter & Paul’s Day (30th June), Chile Independence Day (18th September), John Chilembwe Day (15th January)
Rest period of at least one day per week agreed: → Yes
Provisions on flexible work arrangements: → 

WAGES

Wages determined by means of pay scales: → No
Wages specified according to skill level: → 0
Wages specified according to job title: → 1
Provision that minimum wages set by the government have to be respected: → 
Adjustment for rising costs of living: → 0

Wage increase

Wage increase: → 11.0 %
Wage increase starts: → 2013-05

Premium for evening or night work

Premium for evening or night work: → KES 9.0 per month
Premium for night work only: → Yes

Extra payment for annual leave

Extra payment for annual leave: → KES 4250.0

Premium for overtime work

Premium for overtime work: → 150 % of basic wage

Premium for Sunday work

Premium for Sunday work: → 200 %

Allowance for commuting work

Meal vouchers

Meal allowances provided: → No
Free legal assistance: → 
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