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MEMORANDUM OF AGREEMENT

BETWEEN

SUMARIA INDUSTRIES LIMITED (HEREINAFTER CALLED THE “EMPLOYER’) OF THE SECOND PART

AND

KENYA CHEMICAL AND ALLIED WORKERS UNION WORKERS (HEREINAFTER CALLED THE “UNION”) OF THE FIRST PART

*****************

1.SUBJECT MATTER

The terms and conditions set out in this agreement shall be observed by the parties referred to above and shall apply to all employees of the Company covered by definition given by union’s registered constitution and as provided for by the FKE/COTU (K) agreement.

BASIC MINIMUM RATES OF PAY FOR THE GRADES SHOWN IN APPENDIX “A”

Outgoing Minimum

w.e.f. 01.11.11

w.e.f. 01.11.12

(10% increase)

w.e.f. 1.11.10

(10% increase)

Grade 1 21992/= 24191= 26610/=
Grade 2 19808/= 21789/= 23968/=
Grade 3 17469/= 19216/= 21138/=
Grade 4 16531/= 18184/= 20003/=
Grade 5 20736/= 22810/= 25091/=
Grade 6 13837/= 15221/= 16743/=

PART II OTHER TERMS AND CONDITIONS

2.PROBATIONARY PERIOD

The first three months of employment shall be treated as probationary period. For the first month of probation, any party intending to terminate services shall give 48 hours notice or pay in lieu and second and third months a notice of 7 days or pay in lieu shall be given.

3. WORKING HOURS

An employee shall normally be required to work, whether on shift or otherwise a total of forty-four (44) hours per week exclusive of meal break hours provided that an employee who is required to work in excess of 44 hours per week shall be paid for such excess hours at the appropriate rates as provided by clause 5 of this agreement.

4.EX-GRATIA PAYMENT

An employee shall be entitled to an ex-gratia payment of Kshs. 16,000 if he leaves employment on the following grounds:-

(i) Retirement on age grounds

(ii) Being retired by the Company

(iii) Retirement on Medical Grounds

Provided that, the Company reserves the right to seek for a second medical opinion in respect to employees retiring on medical grounds.

5.OVERTIME RATES

Overtime rates shall be as follows:-

(a) For hours worked on week days in excess of hours set out in clause (3) one time and a half.

(b) For hours worked on an employee’s normal rest days and gazetted public holidays, shall be paid double time.

6.GAZETTED PUBLIC HOLIDAYS

An employee shall normally be granted leave with full pay on gazetted public holidays provided that an employee who is required to work on such holidays, shall be paid double for time worked as provided by overtime clause.

7.ANNUAL PAID LEAVE

After each period of twelve consecutive months service with the employer, an employee with less than 5 years service shall be entitled to annual leave of 26 working days with full pay but those employees who have been in the service of the company for 5 years and over shall be entitled to 29 working days. In the event of a statutory public holidays falling within the leave period, such holidays shall be added to the leave entitlement.

8.SICK LEAVE

An employee shall be entitled to sick leave upto a maximum of 45 days with full pay and thereafter to sick leave upto a maximum of 45 days on half pay in the period of twelve month continuous service, subject to the employee producing a certificate of incapacity covering each period of sick leave claimed, signed by a medical practitioner or a person acting on his behalf in a dispensary or Medical Aid Centre.

9.MATERNITY LEAVE

(a) A female employee shall be entitled to three months maternity leave with full pay, provided that a woman who has taken three months maternity leave shall not forfeit her annual leave in that year.

(b) Child-birth in respect of a female employee shall not be deemed sickness as provided for under clause No. 8 of this agreement and the employer shall not be required to meet the medical expenses.

(c) A female employee who has taken maternity leave shall not incur any loss of privileges during such a period.

10.COMPASSIONATE LEAVE AND LEAVE OF ABSENCE

(a) Any employee desiring to take leave on compassionate grounds shall, by prior arrangement with the employer be granted such leave up to his/her earned leave entitlement under paragraph 7 of this agreement and the leave taken shall be subsequently set off against his/her annual leave.

(b) An employee may, in addition to the leave period provided for in sub-paragraph (a) of this paragraph be granted five (5) days compassionate leave without pay in any one year.

11.MEDICAL TREATMENT

The Company undertakes to pay for the cost of 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 such medical expenses will be made to all employees of the company, provided that such illnesses are those covered by the Act.

12.UNIFORMS/OVERALLS

An employee who is required to wear uniforms or overall by nature of his/her work or in accordance with the Factories Act shall be issued with two pairs of uniforms or overalls by the company. Such uniforms or overalls shall be replaced with new pairs immediately after a period of 12 months as from the date of issue. The uniforms or overalls shall remain the property of the company. The company shall be responsible for laundering such uniforms and overalls, and that where this is impracticable, the company will provide every employee with one bar of washing soap each month.

13.INJURY BY ACCIDENT

In the case of injury covered by Work Injury Benefits Act full pay will be given to the employee and where the Act requires the payment of half-pay during a period of certified temporary disability, an employee shall be paid by the company his/her full wages/salary.

14.EMPLOYEE IN ACTING CAPACITY

An employee temporarily acting in a higher grade job for a period of 21 consecutive days or more within one year, shall receive a minimum salary for that grade for those days he/she occupies the position.

15.SAFARI ALLOWANCE

An employee who is required to perform his/her duties away from his/her principal place of work and as such is unable to take his/her breakfast, lunch or dinner at home, shall be entitled to the following allowances:-

Breakfast-Kshs. 180

Lunch- Kshs. 240

Dinner-Kshs. 280

In addition, an employee who spends a night away from his/her home while on duty shall get an extra Kshs. 950/= for accommodation per night.

16.LEAVE TRAVELLING ALLOWANCE

An employee travelling on annual leave will be entitled to the following allowances w.e.f. 1st November 2011:-

1st Year of the Agreement-Kshs. 7,350

2nd Year of the Agreement-Kshs. 7,800

17.TRANSPORT FACILITIES

The company will provide transport to agreed points within city boundaries for employees who start or leave work between 6.30 p.m. and 6.00 a.m.

18.WARNING SYSTEM

An employee who is guilty of an offence other than gross misconduct or other lawful cause justifying dismissal may be given a warning which shall be entered into the employee’s employment records card and shall remain valid for a period of twelve months from the date of issue. If, within the twelve months period the employee commits a similar offence or any other offence which does not warrant dismissal, he will be further warned in writing in his employment card, and the two warnings shall remain valid for a period of 12 months from the date of the second warning. If the employee commits a further offence which does not warrant dismissal, he will be issued with a final letter of warning which will make him liable to summary dismissal for any other offence which he may commit thereafter. A final letter of warning will remain valid for a period of one year from the date of issue. A copy of the final warning letter shall be sent to the National General Secretary of the Union.

19.REDUNDANCY

(a) “Redundancy” means loss of employment, occupation, job or career by involuntary means through no fault of an employee, involving termination of employment at the initiative of the employer where the services of an employee are superfluous, and the practice commonly known as abolition of office or occupation and loss of employment due to the Kenyanisation of business, but it does not include any such loss of employment by a domestic servant.

(b) Alternative Employment

In an effort to avoid redundancy, the company will endeavour to arrange suitable alternative employment within the company. This employment may not be of the same grade. If the alternative employment is not acceptable to the employee concerned, he will be classified as redundant and therefore eligible for the entitlements outlined in clause (f).

(c) Consultation

In the event of redundancy, the company undertakes to hold prior discussions with the union concerning the reasons for and the extent of the intended redundancy.

(d) Selection of Redundant Employees

In deciding which employees are to be declared redundant the company will assess the relative merit, ability and reliability of the affected employees, but when these factors are equal the discharge will be on the basis of seniority. Membership or non-membership of the union will not be a factor.

(e) Re-engagement

Redundant employees will be given prior consideration for re-engagement by the company should a vacancy arise according to their qualifications.

(f) Entitlement of Redundant Employees

In the event of an employee being declared redundant he/she will be entitled to:-

(i) The usual notice or pay in lieu of notice as defined in the agreement.

(ii)Payment of wages, overtime and any other remuneration due when he/she ceases work.

(iii) Cash in lieu of pro rata leave entitlement in accordance with the agreement.

(iv) Severance pay shall be paid at the following basic rates:

a. Employees with up to 10 years service – 23 days pay for each completed year of service.

b. Employees with over 10 years service – 27 days pay for each completed year of service.

20.TERMINATION OF EMPLOYMENT

After the probation period, contract shall be terminable by not less than one month’s notice which should be given by either party or otherwise by the payment of either party, in lieu of notice of not less than one month’s pay except where an employee is summarily dismissed for gross misconduct or other lawful cause. For those employees with more than 5 years service – 2 months’ notice or salary in lieu of such notice will be given by either party.

21.GRATUITY/SERVICE BENEFITS

An employee whose services are terminated for reasons other than gross misconduct shall be entitled to Gratuity/Service benefits based on the employees final basic salary as follows:-

(i) Employees with up to 10 years service – 27 days pay for each completed year of service.

(ii) Employees with over 10 years service – 30 days pay for each completed year of service.

22.CERTIFICATE OF SERVICE

Every employee shall be given a certificate of service by his/her employer upon the termination of his/her 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 nature and usual place of employment

(d) The date when the employment ceased, and

(e) Such other particulars as may be prescribed.

Subject to sub-section (1) of this section, no employer is bound to give to an employee any testimonials, reference or a certificate relating to the character or performance of an employee. Any employer who willfully or by neglect fails to give an employee a certificate of service in accordance with this sub-section or who in a certificate of service includes a statement which he knows to be fault, shall be guilty of an offence.

23.FUNERAL EXPENSES

In the event of death of an employee, the company shall provide Kshs. 60,000 to the next of kin towards meeting funeral expenses.

24.HOUSING ALLOWANCE

Every employee of the company will be paid a housing allowance effective from 1st November, 2011 as outlined hereunder:-

w.e.f. 1.11.2011-Kshs. 4,700

w.e.f. 1.11.2012-Kshs. 5,000

25.GENERAL WAGE INCREASE

1st year w.e.f. 1.11.2011

Every employee who was in the service as at 1st November, 2011 will be entitled to a general wage increase of 10% based on his/her personal basic rate which he/she was earning prior to this date.

2nd year w.e.f. 1.11.2012

Every employee in service as at 1st November, 2012 will be entitled to a general wage increase of 10% based on his/her personal basic rate which he/she was earning prior to this date.

26.EFFECTIVE DATE AND DURATION

This Agreement shall be effective from 1st November, 2011 and shall remain in force for a period of 24 months from that date, and thereafter until it is amended by mutual agreement between the company and the union, provided that the party desiring to amend the agreement shall give one month’s notice of intention and shall set out in details the amendments or alterations which such party desires.

SIGNED:FOR AND ON BEHALF OF SUMARIA INDUSTRIES LTD.

…………………………………………………………

MANAGING DIRECTORHEAD OF HR, AFRICA

SIGNED:FOR AND ON BEHALF OF THE KENYA CHEMICAL & ALLIED WORKERS’ UNION:

………………………………………..

WERE DIBO OGUTU – O.G.W.

NATIONAL GENERAL SECRETARY

WITNESSED BY:

…………………………………………

HEZRON OPIYO

DEPUTY NATIONAL GENERAL SECRETARY

…………………………………………

GEORGE GWAKO

RECRUITMENT/INDUSTRIAL RELATIONS ASSISTANT

……………………………………………………

JAMES KIRUBIPETER MUNYAO

SHOPSTEWARDSHOPSTEWARD

IN THE PRESENCE OF:

………………………………..

GEORGE R. AMBUCHE

INDUSTRIAL RELATIONS OFFICER – F.K.E.

DATED THIS …………… DAY OF ……………………………2012

APPENDIX “A”

JOB CLASSIFICATIONS AND GRADING SYSTEMS

GRADE I

This grade will cover skilled staff carrying out work requiring experience and skilled operation with a minimum of supervision.

Duties of Grade I

Within this grade will come engineering staff with technical qualifications and long experience e.g. electricians, fitters and tanners. This grade will further be classified into three:-

(a)Employees with Test Grade Certificate Grade 1

(b)Employees with Test Grade Certificate Grade 2

(c)Employees with Test Grade Certificate Grade 3

Grade II

This will cover skilled staff carrying out work requiring experience and technical ability with moderate supervision.

Duties of Grade II (A)

(a)Senior Injection and Blow Moulding machine operators responsible for adjustments to moulding conditions on their own and other employees’ machines to maintain the condition set by machine setter.

(b)Senior Extrusion supervisors able to carry out adjustments to extrusion conditions to maintain quality standards and where set by machine setter.

(c)Skilled employees in the engineering section, fitters and welders, quality controllers whose qualifications or experience do not qualify them for entry to the grade I.

(d)Other employees who, although not employed on full-time grade (I) work, possess special qualifications which the company feels are to its benefit and is therefore prepared to give recognition to.

Grade II (B)

Senior Injector, Blow Moulding and Extrusion supervisors and similar.

Grade III

This grade will cover those employees whose duties require some degree of skill and/or experience. This grade will be appropriate to those employees gaining the necessary qualifications for appointment to Grade II and such employees will normally be expected to carry out Grade II duties with extra supervision during the absence of Grade II employees.

CLERICAL GRADE

Grade I

Senior Clerks carrying out responsible work/dispatch/store clerks, responsible for stock cards system with sticks responsible for company’s cash in keeping and giving out and entering into petty cash books.

Grade II

General Clerks carrying out any general work with moderate supervision and copy typist with minimum of 60 w.p.m., telephone operator/receptionist, store-keeper.

Grade III

Junior Clerks with little or no experience to carry out work with extra supervision or newly employed clerks, payroll clerks.

Grade IV

(a)All employees not covered above.

(b)Machine attendants who are capable to run their machines without much trouble.

Grade V

(a)Car and Light Vans

(b)Medium-sized vehicles

(c)Heavy Commercial Vehicles

Duties of Grade V

(a)Car and Light Vans not exceeding 2 tons T.W.

(b)Medium-sized vehicles – over 2 tons and less than 8 tons T.W. with or without trailer

(c)Heavy Commercial Vehicles – 8 tons T.W. with or without trailer

Grade VI

This grade will cover all unskilled employees having the following responsibilities:

Cleaning, Sweeping, Labouring, Packing, Winding, Tea Making, Drivers Mate, Labelling, Wire Bending, Gardener, Day Watchman, Messenger, e.t.c.

The parties shall recheck the present grading system (job titles) to ascertain that they are in line with statutory requirements. Any grade changes agreed upon by the parties shall be incorporated as an addendum to this agreement.

Sumaria Industries Limited - 2011

Start date: → 2011-11-01
End date: → 2013-10-30
Ratified by: → Other
Ratified on: → Not yet ratified
Name industry: → Manufacturing
Name industry: → Manufacture of rubber and plastic products
Public/private sector: → In the private sector
Concluded by:
Name company: → Sumaria Industries Limited
Names trade unions: → Kenya Chemical and Allied Workers Union

SICKNESS AND DISABILITY

Maximum for sickness pay (for 6 months): → 38 %
Maximum days for paid sickness leave: → 90 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

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: → 44.0
Paid annual leave: → 26.0 days
Paid annual leave: → 4.0 weeks
Paid bank holidays: → Easter Monday, Army Day / Feast of the Sacred Heart/ St. Peter & Paul’s Day (30th June), Chile Independence Day (18th September), John Chilembwe Day (15th January), Human Rights Day / Vernal Equinox Day (21st March)
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: → 10.0 %
Wage increase starts: → 2012-11

Extra payment for annual leave

Extra payment for annual leave: → KES 7350.0

Premium for overtime work

Premium for overtime work: → 150 % of basic wage

Premium for Sunday work

Premium for Sunday work: → 200 %

Meal vouchers

Meal allowances provided: → No
Free legal assistance: → 
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