Cooperatives Cabinet Secretary Wycliffe Oparanya has told the Senate that former employees of the defunct Kenya Cooperatives Creameries (KCC) cannot be compensated by the New Kenya Cooperatives Creameries (New KCC) since the two were not the same in law.
Oparanya said the New KCC Ltd, having not been in existence when the claimants were in employment, was clearly not their employer since the claimants were employees of KCC and could therefore not be compensated by an organisation they did not work for.
Appearing before the Senate plenary to answer questions, Oparanya said that an inter-ministerial committee consisting of the Ministries of Agriculture and Livestock, the Ministry of Cooperatives and National Treasury has been formed to look into the matter and resolve the issue with finality.
“The Inter Ministerial Committee will be tasked to collate, audit, verify, authenticate and validate the claims and recommend whether the same should be settled and to what extent within reasonable timelines,” said Oparanya.
Migori Senator Eddy Oketch had sought an explanation on the failure by the former Kenya Cooperative Creameries (KCC) and now by the New Kenya Cooperative Creameries (New KCC) to pay terminal dues to former employees of KCC whose contracts were terminated in 1999.
Oketch also wanted Oparanya to indicate whether the former employees have received payment for the cooperative society shares they held as at the time of their exit from KCC and if not to provide reasons and when the affected former employees should expect to receive their terminal dues.
He informed the House that in the year 2013, the claimants filed a suit Nairobi Elrc No.1299/2013 John Kihiato Baro & 108 Others — Versus New KCC & the Attorney General seeking to be paid a sum of Sh 204. 4 million at the High Court with the matter heard and concluded and findings made that New KCC was liable to pay KCC former employees dues.
Oparanya said that subsequently, New KCC filed an appeal against the High Court decision at the Court of Appeal under Civil Appeal No. 191 of 2018 with a three-judge bench on July 10,2020 holding that New KCC was not liable for the liabilities of KCC which included the terminal benefits and unpaid Sacco shares of the said claimants.
“However, notwithstanding the absolving of New KCC Ltd from the said liabilities in accordance with the law, the appellate judges implored upon the Attorney General’s office to advise the Government to honour its word and pay the respondents who have suffered long,” said Oparanya.
The Cabinet Secretary said that the former employees may be paid once the Interministerial Committee completes its work and recommends payment and that the National Assembly appropriates the required funds in the National Budget.
Oparanya told the house he was not aware of any complaints on payment of cooperative shares held by the time KCC was liquidated however stating that he was aware of claim of funds deducted from then employees’ salaries that had not been remitted to their cooperative society in respect of their shares.
