New trouble for William Ruto: Officials threaten strike over collective agreement and salary increase

The Union of Kenya Civil Servants (UKCS) has threatened a work boycott if the government fails to implement the second phase of the collective agreement – basic salary increase and housing subsidy.

UKCS general secretary Tom Odege told Saturday Nation that if the pay rise was not reflected on members' September payslips, workers would have no choice but to stay at home.

“The government must prepare for tough times in this regard because we will not let up. If the officials do not see the money, their only option is to go on strike,” Odege said.

The Saturday Nation has learnt that Mr Odege had a lengthy meeting with the new Cabinet Secretary for Public Service, Justin Muturi, in his office from about 11am yesterday to discuss the CBA.

Mr Odege confirmed talks with Mr Muturi, who he said was committed to ensuring the implementation of the collective agreement.

“The minister is positive about our CBA. He said he will meet with the Cabinet Secretary, Ministry of Finance and plan its implementation,” Mr Odege said.

The civil servants' union signed the collective agreement last year. The salary increase was to be implemented in two phases.

Phase One was implemented, but Phase Two, which was due to begin in July, was delayed by the Salaries and Remuneration Commission (SRC), which postponed its implementation by circular.

In a circular dated 16 July 2024, the SRC announced that there would be no salary reviews for civil servants in the 2024/25 financial year due to budgetary constraints and budget cuts resulting from the repeal of the Finance Act 2024.

“Public institutions bound by collective agreements that are affected by the postponed implementation of the salary adjustment in the 2024/25 financial year are requested to contact the respective trade unions accordingly,” the circular states.

The Commission said the review would be put on hold until further notice “subject to the availability of funds” and advice from the Treasury.

However, Mr Odege said the SRC had no power to delay the implementation of the CBA, adding that only the courts could give directions in this regard.

“Once a CBA is signed, it is registered with the court and is legally binding on both parties. It can only be challenged in court and not through a circular as claimed by the SRC,” said Mr Odege.

The Saturday Nation has seen a series of letters written by the Permanent Secretary in the Ministry of Public Services, Performance and Delivery Management, Amos Gathecha, to the Managing Director of the SRC, Anne Gitau, and another letter from the Managing Director of the National Hospital Insurance Fund (NHIF), Elijah Wachira, regarding the implementation of the salary agreement.

In a letter dated 31 July 2024, the Principal Secretary of the Civil Service reminds Ms Gitau of the implementation of the second phase of the salary review for civil servants.

According to the agreement filed with the Labour Court, implementation of the second phase should begin on July 1, 2024 and last until June 30, 2025.

The reviews for the officials comprising Sh1,691,675,113 for basic salary and Sh322,129,938 for housing allowance were duly approved by the Commission vide letter dated 3 August 2023 and budgets were allocated for their implementation in the financial year 2023/2024.

“It is further confirmed that Phase Two of the salary review was part of the commitment in the registered collective agreement duly filed with the SRC. The purpose of this letter is therefore to draw your attention to your advice on how to proceed,” Mr Gathecha's letter reads.

On 17 May 2024, Mr Gathecha wrote to Chris Kiptoo, the Permanent Secretary in the Ministry of Finance, about the Sh9.8 billion that the government owed to the National Hospital Insurance Fund for the provision of comprehensive group life, funeral and worker’s compensation insurance and group accident insurance to officers and employees of the National Youth Service (NYS).

The NHIF has been providing services to NYS officers and employees for three years, from April 15, 2021 to April 14, 2022, from April 14, 2022 to April 14, 2023, and from April 15, 2023 to April 14, 2024.

The three-year contract was renewed annually under a government agreement.

During the first annual cycle, which began on April 15, 2021 and ended on April 14, 2022, the premium was paid in full and amounted to Sh6.8 billion.

However, in the second and third years of the contract, Mr Gathecha informed the Treasury PS that the premium had only been partially paid.

“The outstanding premiums for the second and third annual cycles are Sh2.8 billion and Sh6.8 billion respectively, totalling Sh9.8 billion,” the letter said.

“In these circumstances, there are still outstanding claims from the NHIF that need to be settled as soon as possible. We are writing to ask you to make arrangements that will enable us to settle the outstanding premium.”

Although the government had made some payments, a total of 5,584,956,324 shillings remained outstanding.

In a letter dated August 13, 2024, Mr. Wachira warned Mr. Gathecha that if the amount was not paid within seven days, the continuity of service would be compromised.

“The late payment has created financial difficulties for the NHIF as we must continue to meet our contractual obligations to health care providers for the services availed by the beneficiaries of the scheme,” Mr Wachira’s letter said.

“We demand urgent settlement of the outstanding premium amounting to Sh5,584,956,324 within seven days to ensure continuity of services.”

The seven-day period granted by NHIF to settle the fees expired on Monday and Mr Odege confirmed that the government had not remitted the amount.

“No amount was paid to the NHIF, so they terminated the contract,” said Mr Odege.

The UKCS Secretary General wanted to know why the government had not paid the amount, adding that the officials were on their own when it came to their health.

“Civil servants no longer have insurance coverage and their only option is to take out private insurance. We question the logic because if the state has not managed to cover its own workers, will it manage to finance private insurance?” asks Mr Odege.

He also expressed concern that the ongoing transition from the NHIF to the Social Health Insurance Fund (SHIF) does not provide for comprehensive group insurance for the country's civil servants.

“The civil servants were comfortable with the NHIF and the comprehensive group living. Now the government has stopped paying the NHIF so that it can continue to offer these benefits to the workers,” said Mr Odege.

If the officials carry out their threat, it is likely to cause headaches for the government, as teachers are also insisting on not returning to school from Monday.

Given the harsh austerity measures announced by President Ruto following the rejection of the Finance Bill 2024, the government will have a lot of problems.