Order to reinstate KQ workers ‘worrying’ for investors

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POLYCARP IGATHE

Recent pronouncements from the judiciary and court decisions suggest that the new constitution may unwittingly have led to centralization of great responsibility and power in the judicial arm of government.

This automatically means failure in the judiciary will have far-reaching and terrible consequences to the nation of Kenya.

A few days ago the Industrial Court made a ruling reinstating Kenya Airways workers that has been received as a major blow to industrial relations and the free enterprise market system in Kenya. The court decision sets worrisome precedent – that investors/employers are no longer free to deploy rationality in allocating factors of production to sustain and keep industry and enterprises afloat during hard economic times.

In the Kenya Airways decision, it is appears the judge only interpreted labour as a right enshrined in the constitution and forgot to extend interpretation of labour to being a factor of production. As a factor of production, the investor is expected and at liberty to allocate labour in the most efficient way.

How can the Kenya airways management be at fault for exercising commercial rationality? How can they further be compelled by judgment to reinstate laid off workers at historical price rates, comforts and perks? Which other industry or enterprise is next in line to being forced by judgment to do the same to the detriment of its existence? Does the shareholder and/or investor have no rights under the new constitution? Did the constitution subjugate and diminish the right of the investor, the creator of wealth to the rights of the worker?

Anyway, court decisions are court decisions and KQ has appropriately moved to do what it must do under the law i.e. obey the law. I believe the laid off workers are now reinstated. However anyone running or owning a business with trade union representation must worry and remain eternally concerned.

Left to stand, this decision is a game changer in terms of the investment climate. The decision adds toxicity to the Kenyan economic climate. The government as the largest employer must worry the most.

Any more of this type of decisions by our courts will lead to rapid shifting of production and services to cheaper, more profitable, policy and judicial certain economic climates.

Investors vote with their bank accounts and their legs. Kenyans are taking a wrong turn by allowing such court decisions to stand. It must be lawfully appealed. Otherwise jobs for young people will be exported. Kenya Airways must appeal it and representative Business Member Organizations (BMOs) within Kenya Private Sector Alliance (KEPSA) must enjoin as an interested party in the case.

One of the greatest challenges for Kenya’s future is our habit of not raising enough money through taxation to pay for what the government spends and then heading to borrow in order to bridge the gap. Loss makers do not pay tax. Kenya Airways reported a big loss in 2012.

Kenya Airways shareholders and management are battling to keep it afloat amidst turbulent times. I would appeal to them as well as aviation and allied workers union to meaningfully engage and agree. Do not allow judicial arbitration we shall all lose big from mis-interpretation.

Recently in America the largest bread maker ‘Hostess’ filed for bankruptcy laying off 18,000 workers due to insensitivity of trade unions.

Also review the tragedy of the South African economy that has become structurally uncompetitive due to labour costs advanced by a strong trade union that is part and parcel of the ruling party. Kenya cannot afford the similar toxic and turbulent industrial relations. And God forbid that we have trade unions joining as partners in political parties.

Peter Drucker the guru of management once said – The greatest danger in times of turbulence is not the turbulence; it is to act with yesterday’s logic. We therefore must act with modern updated logic to overcome the matter. Courts must never undermine ‘Willing Employer, Willing Employee’ principle. It is fundamental to free market enterprise.

For information, I am a platinum elite plus customer of Kenya airways. Since the layoffs, I am enjoying a better experience from the KQ on-ground staff. The frustrating ‘idle hardcore sheng banter’ that was KQ ground staff at the gates is much less and the waiting lines are getting shorter.

(Igathe is the Chairman Kenya Association of Manufacturers – KAM)

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  • Kalawa Edward

    I believe you are the type who actually like getting things without any intentions to know who else participated to facilitate in getting whatever you wanted. My learned friend, this is the heart with our MPs, who wants soldiers to carry guns, resist bullets with their chests but what it comes to payment they are rewarded like “MUTHURWA HOUSE-GIRLS” who at the end of month the sock must be taken of the broken cups, flasks, lost umbrella, poured milk, lost napkins so that they can be deducted from the salary of Kshs.1,500.00. How do you feel when the Kenya streets are full of graduates who are jobless, earning nothing and at the same time you and others like you are leaving in the “Royal Estates” driving Sport cars, feeding dogs with Kshs. 10,000.00 per day, importing eggs from South Africa, buying a single dress for 1 million and paying 50 doctors to take care of your health and yet you support the sack of 500 peanut earners instead of supporting them at least to make survival? Do you mean that Kenya should be made of 40 millionaires and 40 million beggars? KQ is a Nationally owned property and it should be of benefit to every Kenyan who gets a chance to work There. Lets put down our inefficiencies, corruptions, tribalism and misuse of powers to achieve the next step as a country. Thank you.

    • The explaination you have put here Bwana Kalawa smacks of anti-investor and hatred for investors.If you think punishing the investor/employer is going to make employees better off then you are outright wrong.Its not KQ’s business to provide welfare for redundant staff.Kalawa imagine you had a business and a relation is brought to hang around your business to do nothing except get paid.would you not fire him?

    • Pigathe

      Will Never be guilty for achieving In Life.Have earned What I have via hardwork, discipline & devotion to God. Also by acknowledging am a factor of production as an employee. Thus toiling hard and extra daily to ensure i earn and keep my Job. I also Thank God Daily for my employer and His Enterprise. Were it not for it I would be on The street hungry and dejected.

  • Mwangi Wanjumbi

    Apparently, employer and investor attitudes could continue being challenged, as long as employees are perceived as factors of production or tools of performance. That for employees will equally be challenged.
    Under such circumstances, it is difficult to guarantee harmony and
    optimum performance in the workplace. The same can only be enforced in
    which case it may be difficult to achieve desired success. Do such attitudes guarantee continued growth? I can only make a good guess.

  • Mutunga

    I agree with the writer that the court ruling reinstating Kenya Airways workers is a major blow to industrial relations and the free enterprise market system in Kenya. The cycle of poor economic decisions started with our MPs being awarded exorbitant perks without
    any due regard to economic realities and against the better judgement of most Kenyans. Public university lecturers rightfully followed suit and agitated for better terms. They were followed by other civil servants and teachers. The end result is what the writer says “One
    of the greatest challenges for Kenya’s future is our habit of not raising enough money through taxation to pay for what the government spends and then heading to borrow in order to bridge the gap”. How the government would borrow to consume beats economic logic.
    In Kenya today roles have reversed such that public servants earn better salaries on average compared to private sector employees. This reversal has created pressure on private sector employees to agitate for better terms. KQ employees did it, they got better
    terms but the company has made a huge loss. The question to ask is whether the huge wage bill, under tough economic conditions, for KQ or for any other private sector employer is sustainable. Common sense would dictate that it is not. Under the circumstances, the writer is correct when he says that jobs for young people will be exported. The biggest challenge in Kenya today is youth unemployment. With decisions like these the situation can only get worse. It is for this reason that I wish to support the writer in appealing to KEPSA to seriously engage the government on the Government wage bill and on industrial
    relations in general.

  • AsItIs

    Spot on! ‘idle hardcore sheng banter’….. I totally agree. I am also a proud customer of KQ but I had observed that their customer service and people relations were getting worse by the day. Most of the ground staff have poor work ethics and lack the finese that is needed on the job. Sadly, this had spread to cabin crew as well, some of whom would be untidy, without name tags, use poor Kiswahili and English, were rude and indifferent to customers, typical ‘mtaa attitude’. I have often wondered why KQ does not have a readily accessible, easy-to-use complaints mechanism. KQ is in the business of making money and if those staff are the stumbling block, then with all due respect, they need to go and replaced with others who understand their job well and will do it without behaving as if it is a favour they are doing to customers and the airline. There are very many jobless university graduates in the country who given the opportunity would do the airline proud. Raise the bar higher and try them.

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