September 2014
Embassy of the Republic of Korea
High level summary of
the “Key Employment
Acts” in Kenya
Contents
1. Background ... 4
2. Executive Summary ... 6
3. Employment Act ... 9
4 Work Injury Benefits Act (“WIBA”) ... 17
5. The Occupational Safety and Health Act (“OSH” Act) ... 22
6. The National Social Security Fund (“NSSF”) Act 2013 ...27
7. The Labour Relations Act ... 34
1. Background
1. Background
1. Background and our understanding
The Embassy of the Republic of Korea has been established in Kenya since 1964. Bilateral relations between the two countries have grown to a wider array of cooperation areas. Although the Embassy is primarily tasked with the management and processing of Visa applications for individuals looking to travel to Korea, they are increasingly being asked to assist Korean businesses who are looking to establish and invest in Kenya (and the supporting East Africa region).
As part of this, the Embassy is seeking our assistance in helping you to manage the various Korean business stakeholders who are looking to / have established in Kenya.
The first phase of this long-term partnership is for PwC to provide a high level overview of the critical Labour laws in Kenya so that the Korean business owned/stakeholders can become abreast of the legal obligations and requirements when recruiting and employing individuals in Kenya.
2. Scope of Services
Our current scope of work includes provision of a high level overview of each of the following Kenyan Acts of Government:
A. Employment Act
B. Work Injury Benefits Act
C. Occupational Safety and Health Act D. National Social Security Fund Act 2013 E. Labour Relations Act
We have provided a high level summary of each of the Acts below.
2. Executive Summary
2. Executive Summary
2.1 Objective of the Labour Laws
The Central Organisation of Trade Unions (“COTU”), Federation of Kenyan Employers (“FKE”) and the Government of Kenya performed a review of the labour statutes in Kenya in May 2001 and repealed the previously enacted Acts to come up with:
the Employment Act (repealed the Employment Act, Cap 226);
the Work Injury Benefits Act (repealed the Workmen’s Compensation Act);
the Occupational Safety and Health Act ( repealed the Factories and Other Places of Work Act)
the National Social Security Fund Act 2013 (repeals the NSSF Act)
the Labour Relations Act 2007 (repeals the Trade Dispute Act)
The overall objective was to ensure that the laws are responsive to contemporary economic and social changes and to achieve a new set of reformed and updated labour legislation through a coordinated consultative process.
2.2 Provisions of the Employment Act
The objective of the Employment Act is to strengthen the minimum terms and conditions of employment.
Some of the intended objectives include to:
Prohibit forced and child labour, sexual harassment at work and discrimination on the basis of disability, HIV/AIDS status, etc;
Provide for 21 days of annual leave for all employees, 3 months of maternity leave for females and 2 weeks paternity leave for male employees;
Safeguard employees’ entitlements in the event of an employer becoming insolvent; and
Ensure that employees do not lose their employment retirement benefits for years worked.
2.3 Provisions of the Work Injury Benefits Act
The objective of the Work Injury Benefits Act was to modernise the legislation and bring it up to date with the current circumstances and realities.
It was intended to ensure that there was a minimum insurance cover and adequate compensation for injury and work related diseases regardless of employer’s insolvency and disallow any subsequent common law claims.
2.4 The Occupational Health and Safety Act
This Act seeks to secure the safety and health for people in all workplaces and is based on the concept of
“duty of care”. It encourages employers to set achievable safety targets for their enterprises and promotes reporting of workplace accidents, dangerous incidents and ill-health with a view to finding out their causes and preventing similar incidents in the future.
2.5 The National Social Security Fund (“NSSF”) Act 2013
The NSSF Act 2013 upgrades the old NSSF provident fund to a pension scheme. The new Act will increase the monthly contributions payable by employers and employees to a combined rate of 12% of pensionable earnings per month.
Whilst the new NSSF Act 2013 was due to take effect from 1 June 2014, this has now been pushed back pending a court ruling. In light of the court ruling, the NSSF Provident Fund contributions rates of KES 400 (KES 200 for an employee and KES 200 for an employer) continue to apply pending the hearing/conclusion of the court case.
Contributions to the new Pension Fund will be tax deductible despite any other written law. The contributions into the New Pension Fund scheme are divided into two Tiers:
Tier I contributions are mandatorily payable to the NSSF; and
Tier II contributions are payable to NSSF by the employer unless the employer opts to pay the Tier II contributions into an approved contracted out scheme (i.e. occupational pension scheme or a private pension scheme).
2.6 The Labour Relations Act
The Labour relations Act of 2007 came into effect in June 2008 and was enacted to repeal the Trade Disputes Act. It provides legislation on the relationships between employers and employees; gives regulations on the formation, membership and dissolution of trade unions, as well as providing for the methods of dealing with trade disputes between employers and employees.
2.7 Next Steps
Subject to your review and feedback, we can discuss next steps, for example arranging a seminar with the relevant stakeholders.
3. Employment Act
3. Employment Act
The Kenya Employment Act, 2007, received presidential assent on 22 October 2007 and came into effect from 2 June 2008.
The Employment Act declares and defines the fundamental rights of employees, provides basic conditions of employment, regulates employment of children and applies to both domestic and foreign contracts of employment.
3.1 Important definitions in the Act:
Casual Employee - means a person who is paid for their employment services at the end of each day and who is not engaged for a longer period than 24 hours at a time;
Employee – means a person employed for wages or salary and includes an apprentice;
Employer – refers to any person, public body, firm, corporation or company who or which has entered into a contract of service to employ any individual; and
Contract of Service – means an agreement, whether oral or in writing, and whether express or implied, to employ or to serve as an employee for a period of time, but does not include a foreign contract of service.
This Act applies to all employees employed by any employer (based in Kenya) under a contract of service, and includes the government of Kenya.
3.2 Prohibition against forced labour
The act prohibits any manner of forced labour and imposes either of following:
a) a fine not exceeding KES 500,000; or
b) imprisonment for a term not exceeding two years or;
c) both
to any person who contravenes this prohibition.
Forced labour has been defined as “any work or service which is extracted from any person under the threat of any penalty, including the threat of a loss of rights or privileges, which is not offered
voluntarily by the person doing the work or performing the service.”
3.3 Discrimination in employment An employer is required to:
a) promote equal opportunities in employment and eliminate discrimination in any employment policy (which includes any policy or practice relating to recruitment procedures, job
classification and grading, remuneration, training and development, promotion, transfer, demotion, termination of employment on disciplinary procedures); and
b) promote and guarantee equality of opportunity for a person who is a migrant worker or a member of the family of the migrant worker, lawfully residing in Kenya.
No employer should harass and/or discriminate, against an employee or prospective employee:
a) on grounds of race, colour, sex, language, religion, political or other opinion, nationality, ethnic or social origin, disability, pregnancy, mental status or HIV status;
b) in respect of recruitment, training, promotion, terms and conditions of employment, termination of employment or other matters arising out of the employment.
However, it is not discrimination if an employer seeks to:
a) take affirmative action measures consistent with the promotion of equality or the elimination of discrimination in the workplace;
b) distinguish, exclude or prefer any person on the basis of an inherent requirement of a job;
c) employ a citizen in accordance with the national employment policy; and
d) restrict access to limited categories of employment where it is necessary in the interest of State security.
3.4 Sexual harassment
The act also outlaws sexual harassment in the workplace. This provision requires every employer to take steps to ensure that no employee is subjected to sexual harassment of any form and take disciplinary measures against any employee(s) committed of sexually harassing another colleague.
An employer who employs 20 or more employees should, after consulting with the employees or their representatives, issue a policy statement on sexual harassment and evaluate this within the organisation.
3.5 Provisions on employment contracts
The act also provides guidelines on the nature of contracts of employment. It states that, a contract of service should be in writing if:
a) It is for a period or a number of working days which amount, in the aggregate, to the equivalent of three months or more; or
b) It provides for the performance of any specified work which could not reasonably be expected to be completed within a period or a number of working days amounting in the aggregate to the equivalent of three months.
A written contract of service should include the following details:
i. the name, age, permanent address and sex of the employee;
ii. the name of the employer;
iii. the job description of the employment;
iv. the date of commencement of the employment;
v. the form and duration of the contract;
vi. the place of work;
vii. the hours of work;
viii. the remuneration, scale or rate of remuneration, the method of calculating that remuneration and details of any other benefits;
ix. the intervals at which remuneration is paid; and
x. the date on which the employee’s period of continuous employment began, taking into account any employment with a previous employer which counts towards that period;
xi. entitlement to annual leave, including public holidays, and holiday pay
xii. incapacity to work due to sickness or injury, including any provision for sick pay; and xiii. any other prescribed matter.
3.6 Payment of wages and salaries
An employer should pay the entire amount of wages payable to an employee in respect of the work done in pursuance of a contract of service directly, in Kenyan currency in either:
a) Cash in hand;
b) Cash into a bank account / building society designated by the employee;
c) By cheque, postal order or money order; or
d) Cash / cheque made payable to a person other than an employee duly authorised in writing by the employee to receive the wages.
Wages or salaries should be deemed to be due at the end of the day (in the case of a casual employee) and in the case of an employee employed for a period of more than a day but not exceeding one month, at the end of that period.
No wages should be payable to an employee who has been detained in custody or is serving a sentence of imprisonment under any law.
An itemised pay statement should be provided to every employee (except casual employees) either at or before the time of payment of salaries.
Note: Although reference is made to salaries being payable in Kenya shillings, this is not an enforced requirement as employers are able to pay their employees in another currency.
3.7 Deduction of wages
An employer may deduct from an employee’s wages:
a) Any amount due from the employee as a contribution to any provident fund or statutory authority (i.e. KRA, NSSF, NHIF);
b) A reasonable amount for any damage done;
c) An amount not exceeding one day’s wages in respect of each working day for which an employee is absent from work without leave; and
d) Any amount paid to an employee in error.
An employer who wrongfully withheld or deducted remuneration from an employee’s pay is required to repay this amount to the employee within the next payment cycle.
An employer who contravenes any requirements within the Act, may be liable to either:
a) fine not exceeding KES 100,000; or
b) to imprisonment for a term not exceeding two years; or c) both.
If an employer advances to an employee (i.e. a casual employee) a loan in excess of one month of their wages, or to a permanent employee with a written contract a loan in excess of two months wages, this shall not be recoverable in a court of law should the employee default on the repayment of the loan.
Therefore a separate security should be taken by the employer to secure the repayment.
However, an employer has the right to deduct repayment or part repayment of a loan payable by the employee under a written agreement, up to a maximum of 50% of the wages payable (after taking into consideration any statutory deductions).
3.8 Security bond for wages
An employer who is not incorporated or resident in Kenya may be required by the Minister to pay a bond assessed at the equivalent of one month’s wages for all employees.
This will be held by the Minister on behalf of that employer in a separate interest bearing account and shall not be used for any purpose other than paying wages and other entitlements to that employer’s employees in the event of default by that employer.
Agencies such as KOICA (Korean International Cooperation Agency) and KOTRA (Korea Trade
Promotion Corporation) would require a security bond for wages unless they have a separate agreement with the government to the contrary. On the other hand, if as an employer they have an authorised agent resident in Kenya, the Minister may require that the security bond is given by the agent and the agent shall personally be bound by the terms of the bond.
3.9 Working hours
An employer shall regulate the working hours of each employee in accordance with the provisions of this Act. An employee should be entitled to at least one rest day in every period of seven days.
Furthermore, an employee should be entitled:
a) after every twelve consecutive months of service, to at least 21 working days of leave with full pay;
and
b) where employment is terminated after the completion of two or more consecutive months of service during any twelve months’ leave-earning period, an employee should be entitled to not less than one and three-quarter days of leave with full pay, in respect of each completed month of service.
3.10 Maternity leave
A female employee is entitled to three months maternity leave with full pay while a male employee is entitled to two weeks paternity leave with full pay.
In a situation where either:
a) The maternity leave has been extended with the consent of the employer; or
b) immediately on expiry of maternity leave before resuming her duties a female employee proceeds on sick leave or with the consent of the employer on annual leave; compassionate leave; or any other leave.
The three months maternity leave shall be deemed to expire on the last day of such extended leave.
A female employee who seeks to proceed on maternity should, if required by the employer, produce a certificate as to her medical condition from a qualified medical practitioner or midwife.
Note: Compassionate leave is usually covered for immediate family or close relatives, which can include an employee’s parents, spouses, siblings, children and grandparents. However, when an employee requests compassionate leave for any other family member (not already mentioned), whether it is approved and granted by an employer, will generally be at the employer’s discretion.
3.11 Sick leave
After two consecutive months of service with their employer, an employee is entitled to sick leave of not less than seven days with full pay and thereafter to sick leave of seven days with half pay, in each period of twelve consecutive months of service, subject to production by the employee of a certificate of incapacity to work signed by a duly qualified medical practitioner.
3.12 Housing
The act provides the following guidelines concerning provision of housing facilities to an employee by an employer:
1. An employer shall at all times, at his own expense, provide reasonable housing
accommodation for each of his employees either at or near to the place of employment, or
2. An employer shall pay to the employee a sufficient sum, as rent, in addition to the wages or salary of the employee, to enable the employee to obtain reasonable accommodation. Sufficient sum is generally 15% of the basic minimum wage of the employee.
This section does not apply to an employee whose contract of service contains a provision which consolidates as part of basic wage or salary, an element intended to be used by the employee as rent or which is otherwise intended to enable the employee to provide himself with housing accommodation.
The Act does not prescribe any explicit penalties for non provision of housing, although the Act provides a blanket penalty of:
a) KES 50,000; or
b) imprisonment for a term not exceeding 3 months; or c) both,
for any contraventions of provisions where a penalty has not been specified (and this will therefore apply where housing is not provided).
3.13 Termination
An employee whose contract of service has been terminated is entitled to service pay for every year worked, the terms of which should be fixed. Service pay should be calculated at 15 days of salary for every year worked.
In any claim arising out of termination of a contract, the employer is required to prove the reason or reasons for the termination, and where the employer fails to do so, the termination shall be deemed to have been unfair.
No employer has the right to terminate a contract of service without notice or with less notice than that to which the employee is entitled by any statutory provision or contractual term.
Where an employee has been summarily dismissed or their employer has unfairly terminated his employment without justification, the employee may, within three months of the date of dismissal, present a complaint to a labour officer.
No employee whose services have been terminated or who has been summarily dismissed during a probationary contract can make a complaint to a labour officer.
An employer is required to issue to an employee a certificate of service upon termination of his employment, unless the employment has continued for a period of less than four consecutive weeks.
Since the Act imposes strict requirements relating to dismissal, termination, redundancy and
complaint procedures, it is strongly recommended that companies seek professional assistance when dealing with such employee issues.
Where an employee gives notice of termination of employment and the employer waives the whole or any part of the notice, the employer shall pay to the employee, remuneration equivalent to the period of notice not served by the employee, unless the employer and employee agree otherwise.
The Ministry of Labour, Social Security & Services has offices located on the 7th floor (Block A) of the NSSF building in Nairobi.
3.14 Employment of children
The Act provides that no person should employ a child who has not attained the age of 13 years whether gainfully or otherwise in any undertaking.
A child of between 13 years of age and 16 years of age may however be employed to perform light work which is:
a) not likely to be harmful to the child’s health or development; and
b) not such as to prejudice the child’s attendance at school and affect their participation in vocational orientation or training programmes.
The Act defines those of 16 to 18 years of age as employable.
Note: A child between 13 and 16 years of age is prohibited from entering into a written contract of employment.
3.15 How can PwC help?
For a new company choosing to set up in Kenya, it will be fundamental that the owners understand what their requirements are from an employment law perspective. PwC is therefore able to provide the following levels of assistance when required:
Advice on how employment/secondment contracts should be drafted (particularly for foreign companies who are not familiar with the laws in Kenya);
Reviewing employment contracts to ensure that the provisions within this Act are maintained;
Advising companies on how to structure termination of contracts, which includes drafting termination letters; and
Reviewing/drafting staff handbooks to ensure that the provisions of this Act are embedded within the company policy guidelines.
4. Work Injury Benefits
Act (“WIBA”)
4. Work Injury Benefits Act (“WIBA”)
WIBA received presidential assent on 22 October 2007 and came into effect from 2 June 2008. This Act provides for compensation to employees for work related injuries and diseases contracted in the course of their employment and for connected purposes.
This Act should apply to all employees, including employees employed by the Government, other than the armed forces.
An “accident” has been defined as an accident arising out of and in the course and scope of an employee’s employment and resulting in personal injury.
4.1 Obligations for an Employer
Every employer should obtain and maintain an insurance policy, with an insurer approved by the Minister of Labour, Social Security and Services (“Minister”) in respect of any liability that an employer may incur under this Act to any of their employees.
Any employer who contravenes these provisions commits an offence and is liable on conviction to either:
a) a fine not exceeding KES 100,000; or
b) imprisonment for a term not exceeding three months; or c) to both.
4.2 Right to compensation and grounds for entitlement
An employer is liable to pay compensation to an employee injured whilst at work.
However, an employee is not entitled to compensation if an accident, not resulting in serious disablement or death, is caused by the deliberate and wilful misconduct of the employee.
The following persons should not be regarded as employees for the purposes of this Act:
A person whose employment is of a casual nature and who is employed otherwise than for the purposes of the employer’s trade or business;
A member of the employer’s family;
An employee who has been deployed outside Kenya for a continuous period of 12 months; and
An employee who is ordinarily employed outside Kenya by an employer that carries on business chiefly outside Kenya, and is injured in an accident whilst temporarily deployed outside Kenya.
An injury shall only be deemed to result in serious disablement if the employee suffers a degree of permanent disablement of forty per cent (40%) or more.
4.3 Reporting of accidents
A claim for compensation should be lodged by or on behalf of the injured employee within 12 months after the date of the accident, or in the case of death, within 12 months after the date of death.
4.4 Compensation for temporary disablement
An employee who suffers temporary total disablement due to an accident that incapacitates the employee for three days or longer is entitled to receive a periodical payment equivalent to the employee’s earnings. , subject to the maximum and minimum amounts fixed by the Minister. Please note that the maximum and minimum amounts have not been specified in the Act but there are
generally fixed at the discretion of the Minister after consultation with the Council. The first schedule of WIBA clarifies the various injuries and the degree of disablement an employee might face as a result of the type of injury suffered.
Periodical payments should be made for as long as the temporary disablement continues, but not for a period that exceeds 12 months. An employee is not entitled to receive a periodical payment during any period in which the employee is receiving full pay, as provided for in the Employment Act. Full pay is received by an employee when he/she is on sick leave, maternity leave, paternity leave and annual leave.
Therefore, a periodical payment will usually be at the discretion of the employer and could be fixed at part payment of their monthly remuneration for example (provided the employee does not receive more than the employee would otherwise have earned).
The right to compensation for temporary, total or partial disablement expires:
a. upon the cessation of the disablement or if the employee resumes work;
b. if the employee resumes any other work at the same or greater earnings; or c. if the employee is awarded compensation for permanent disablement.
4.5 Compensation for permanent disablement
If, as a result of an accident, an employee sustains permanent disablement and at the time of the accident was in the process of being trained, the earnings of the employee to which they may be entitled to should be calculated on the basis of the earnings to which he or she would have been entitled as an employee with 5 years of experience.
Compensation for permanent disablement should be calculated on the basis of ninety six (96) months’
earnings.
4.6 Compensation for death of an employee
If an employee dies as a result of an injury, compensation should be paid to their dependants in accordance with amounts stipulated in the Third Schedule of the Act.
The Third schedule in the Act limits the level of compensation to dependants of the deceased based on the number children they have at death in accordance with the following limits:
DEPENDANT’S COMPENSATION
1. One child — 12.5% of an employee’s allowance 2. Two children — 17.5% of an employee’s allowance 3. Three children — 22.5% of an employee’s allowance 4. Four children — 27.5% of an employee’s allowance 5. Five children — 32.5% of an employee’s allowance 6. More than five children — rate to be determined.
In addition to the compensation payable under this section, the employer is liable to pay reasonable expenses for the funeral (up to a limit of KES 10,000) of the deceased employee.
4.7 Objection to a Director’s decision
Any person aggrieved by a decision of the Director of Occupational Safety and Health services (the
“Director”) on any matter under this Act may, within 60 days of such decision, lodge an objection against such a decision.
The Director should, within 14 days after the receipt of an objection provide a written answer to the objection, varying or upholding their decision and provide reasons for the decision objected to.
The Director’s office address is set out below.
Director
Directorate of Occupational Health and Safety Services Ministry of Labour
CIS National Centre Commercial Street P.O. Box 34120 - 00100 NAIROBI
Tel.: (+254-20) 557 433 Fax: (+254-20) 559 663 www.doshs.go.ke doshdept@yahoo.com
4.8 Medical expenses
An employer can pay reasonable expenses incurred by an employee as the result of an accident arising out of and in the course of the employee’s employment in respect of the following:
Dental, medical, surgical or hospital treatment;
Skilled nursing services;
The supply of medicine and surgical dressing;
Travelling and subsistence in connection with an employee’s journey to where he has been directed for treatment; and
The supply maintenance, repair and replacement of artificial limbs or crutches.
4.9 General penalty applicable under this Act
A person convicted for an offence under this Act for which no other penalty is provided can be liable to either:
a) a fine not exceeding KES 200,000; or
b) to imprisonment for a term not exceeding one year; or c) both.
4.10 Claim for compensation
An employer or insurer, against whom a claim for compensation is lodged by the Director, should settle the claim within 90 days of lodging the claim.
4.11 Impact on Employers
Below is a summary of the main implications of the WIBA Act for employers:
It is a “no fault Act”. This means that no negligence on the part of the employer needs to be proven for a claim to be payable.
Employers should ensure that their insurance policies are in line with the provision of WIBA.
Employers should ensure that a proper record of earnings for each qualifying employee is maintained.
Employers should maintain proper internal processes and procedures to avoid any unnecessary exposure.
Since the insurance required to be taken out under this Act is between the employer and the insurance companies, employee regulations are therefore not binding on insurance companies who act on the instructions of the employer.
Since all “non occupational related accidents” are out of scope under WIBA, a separate
“personal accident policy” should be maintained by employers (or privately by the employee) which offers wider covers.
The liability for injury caused is dependent on the circumstances at hand. For example, if it is due to negligence of the employer i.e. slippery floor without sufficient warning or lack of hand rails etc, then the employer would be liable. However, if it is due to negligence of the employee such as an injury caused by them running down the stairs (when there are warning signs not to), then the employer will not be liable.
Note: The definition of insurance policies in this context refers to a policy related to the liability of an employer’s employees (and does not encompass medical cover for employees).
4.12 How can PwC help?
Based on the implications covered above for employers, PwC can assist with the following:
Reviewing insurance policies to ensure that they are in line with the provisions of WIBA;
Assisting employers to maintain and review a record of their earnings;
Review an employer’s internal procedures to ensure proper processes are followed;
Assist with determining the potential exposure for an employer, in cases where an accident leads to temporary or permanent disablement of a member of staff; and
Assist with drafting/reviewing employment contracts.
5. The Occupational
Safety and Health Act
5. The Occupational Safety and Health Act (“OSH” Act)
This OSH Act received presidential assent on 22 October 2001, but only came into effect from 26 October 2007.
It seeks to provide for the safety, health and welfare of workers and all persons lawfully present at workplaces in Kenya and to provide for the establishment of the National Council for Occupational Safety and Health.
The OSH Act applies to all workplaces (in Kenya) where any person is at work, whether temporarily or permanently.
The purpose of this Act is to:
a) secure the safety, health and welfare of persons at work;
b) protect persons other than persons at work against risks to safety and health arising out of, or in connection with, the activities of persons at work;
c) prevent child labour especially where the child’s health is exposed to harm; and d) encourage reporting of accidents at the work place.
5.1 Codes of practice
For the purpose of providing practical guidance with respect to any provision of this Act and of safety and health regulations, the Director of Occupational Health and Safety Services (“Director”) should, in consultation with the council, approve and issue “codes of practice” which are suitable for that purpose.
These codes will be used as guidelines on how operations should be conducted in the workplace to ensure safety of all workers therein.
5.2 Occupier of a property
This refers to person(s) in actual occupation of a workplace, whether as the owner or not and includes an employer.
5.3 Duties of the occupier and penalties for non compliance
Every occupier should ensure the safety, health and welfare at work of all persons working in their workplace.
Every occupier should carry out appropriate risk assessments in relation to the safety and health of persons employed. On the basis of these results, employers should adopt preventive and protective measures to ensure that all chemicals, machinery, equipment, tools and processes under the control of the occupier are safe and comply with the requirements of safety and health provisions in this Act.
Every occupier should send a copy of a report of risk assessment carried out under this Act to the Area Occupational Safety and Health Officer. To obtain details of your local officer, go to www.labour.go.ke.
Every occupier should take immediate steps to stop any operation or activity where there is an imminent and serious danger to safety and health and must evacuate all persons employed as appropriate. It is the duty of every occupier to register their workplace unless such a workplace is excepted from registration under this Act.
An occupier who fails to comply with a duty imposed under this regulation commits an offence and should, on conviction, be liable to either:
a) a fine not exceeding KES 500,000; or
b) to imprisonment for a term not exceeding six months; or c) to both.
5.4 Duties of self-employed persons
Every self-employed person should take all the necessary precautions to ensure his own safety and health and that of any person in his workplace or within the environs of his workplace.
5.5 Safety committee
Every occupier should establish a safety and health committee at the workplace in accordance with regulations prescribed by the Minister if:
a) there are 20 or more persons employed at the workplace; or b) the Director directs the establishment of such a committee.
5.6 Safety and Health Audit
The occupier of a workplace should ensure that a thorough safety and health audit of his workplace is carried out at least once every 12 months by an external safety and health advisor. After such an audit, the advisor should issue a report containing the prescribed particulars the audit taken and should send a copy of the report to the Director. The audit report should be preserved and be kept available for inspection by the Area Occupational Safety and Health Officer.
5.7 Misuse of safety equipment
A person who wilfully interferes with or misuses any means, appliance, convenience or other thing provided or done in the interests of safety, health and welfare commits an offence and should, on conviction, be liable to either:
a) a fine not exceeding KES 100,000; or
b) to imprisonment for a term not exceeding three months; or c) to both.
5.8 Occupier’s duty of care
An employer or self-employed person should notify the Area Occupational Safety and Health Officer of any accident, dangerous occurrence, or occupational poisoning which has occurred at the workplace.
Where an accident in a workplace causes the death of a person, the employer or self-employed person should:
a) inform the Area Occupational Safety and Health Officer within 24 hours of the occurrence of the accident; and
b) send a written notice of the accident in the prescribed form to the Area Occupational Safety and Health officer within seven days of the occurrence of the accident.
Where an accident in a workplace causes non-fatal injuries to a person, the employer should send to the Area Occupational Safety and Health Officer, a written notice of the accident in the prescribed form within seven days of the occurrence of the accident.
The “prescribed forms” can be obtained from the schedules contained within the Act.
5.9 Powers of an occupational safety and health officer
Under this Act, an Occupational Safety and Health Officer has the power to:
a) enter, inspect and examine, by day or by night, a workplace, and every part thereof, where they have reason to believe that any person is employed therein (irrespective of the number of employees); and
b) enter, inspect and examine, by day, any place which he has reason to believe to be a workplace and any part of any building of which a workplace forms part and in which he has reason to believe that explosive, highly inflammable or any other hazardous materials are stored or used.
The Occupational Safety and Health Officer should notify the occupier of some other person in authority at a workplace of his arrival. Where prior notification is not provided, he must inform the occupier and the Director in writing of the reason why not notification was given.
Where an Occupational Safety and Health Officer is obstructed in the execution of his powers or duties under this Act, the person obstructing the officer commits an offence and shall on conviction be liable to either:
a) a fine not exceeding KES 100,000; or
b) to imprisonment for a term not exceeding six months; or c) to both.
5.10 Registration of premises
Before any person occupies or uses any premises as a workplace, they must apply for the registration of the premises (certificate of registration). Any person who, without having been issued with a certificate of registration occupies or uses any premises as a workplace commits an offence and shall, on conviction, be liable to either:
a) a fine not exceeding KES 100,000; or
b) to imprisonment for a term not exceeding three months; or c) to both.
5.11 General Penalty
Any person who commits an offence under this Act for which no express penalty is provided shall on conviction be liable to either:
a) a fine not exceeding KES 300,000; or
b) to imprisonment for a term not exceeding 3 months; or c) to both.
5.12 Challenges for employers
Below is a summary of some of the challenges and concerns raised about the OSH Act:
There is an increased cost of compliance on employers and there have been complaints that the undertakings introduced by this Act have been loaded on employers without sufficient prior consultation.
A lack of comprehensive policy has contributed to a weak safety culture amongst workers and employers.
The Act remains vague with respect to how often employers must provide employee training on occupational safety and health matters and as to what constitutes adequate employee training.
Whilst the Act requires employers to have a health and safety committee, many employers find it a challenge to train individuals for this role and allocate the necessary resources.
5.13 How can PwC help?
Based on the requirement for employers under the OSH Act, you may need to seek professional guidance in the following:
Assistance with completing the necessary steps to register a workplace;
Assistance provided to employers to perform a risk assessment of the health and safety in their workplace; and
Assistance with drafting and reviewing a health and safety policy.
6. The National Social
Security Fund (“NSSF”)
Act 2013
6. The National Social Security Fund (“NSSF”) Act 2013
The NSSF Act 2013 received presidential assent on 24 December 2013. The new rules were originally enacted to take effect from 10 January 2014, however the Minister of Labour, Social Security and Services pushed back the date of commencement to 1 June 2014.
As at the date of this publication (August 2014), the commencement date for these new rules have been further pushed back due to the ongoing court case.
The new Act needed regulations to be published which provided guidelines on how the new act should operate. These guidelines called the “National Social Security Fund (Member contributions) Regulations 2014”, were released on 13 June 2014.
In light of the pending case, the old rules continue to apply under the NSSF Provident Fund. As such, the contribution rates of KES 400 (KES 200 for an employee and KES 200 for an employer) currently apply whilst employers await the outcome of the court case.
6.1 Important Definitions in the Act
Wages has been defined as “emoluments payable to an employee under a contract of service if no deductions were made, in pursuant to any law requiring or permitting the making of any deduction or otherwise excluding fluctuating emoluments”.
However, the NSSF regulations further defines fluctuating emoluments to mean “employee earnings not paid on a fixed basis, but additional to basic wage or salary and includes benefits in kind, acting allowance, special duty allowance, leave allowance, uniform allowance, equipment allowance but does not include bonuses, commissions, overtime, shift pay, house allowance and service charge”.
Employee means “any person who has attained 18 years and who is:
a) employed in Kenya under a contract of service;
b) ordinarily resident in Kenya and is employed outside Kenya under a contract of service entered into with an employer who resides in or has a place of business in Kenya; or
c) ordinarily resident in Kenya and is employed under a contract of service”.
Contract of Service means an agreement, whether entered into orally or in writing, and whether express or implied, to employ or to serve as an employee for a period of time and includes a contract of apprenticeship.
Employer means a person, public body, firm, corporation or company who or which has entered into a contract of service and includes the Government.
6.2 Creation of two Funds
Under the NSSF Act 2013, two funds have been established:
a) New Pension Fund - existing members of the Old NSSF Provident Fund automatically become members of the New Pension Fund except those who made voluntary contributions to the Old Provident Fund. All qualifying “employees” have to be registered in the New Pension Fund.
b) New Provident Fund - this new fund is for:
self-employed persons who voluntarily register; or
employees who choose to make additional voluntary contributions.
6.3 Registration of employers and employees
All employers with one employee or more over the age of 18, and who is employed in Kenya under a contract of service, whether oral or written, express or implied, are required to register with the NSSF and remit contributions every month (otherwise a fine of KES 50,000 will be levied for failure to register).
As per above, the definition of “contract of service” has been drafted very widely so that “casual workers” are now expected to fall within the meaning of an “employee”.
A self-employed person may voluntarily register with the new Provident Fund.
6.4 Mandatory contributions to the Fund
Pension contributions will be 12% of an employee’s ‘pensionable earnings’ split as follows:
a) Employer contributions (deducted from company earnings) at 6% of the employee’s monthly ‘pensionable earnings’; and
b) Employee contributions (deducted from the employee’s earnings) at 6% of the employee’s monthly ‘pensionable earnings’.
6.5 Pensionable Earnings
The amount of NSSF contributions that both employers and employees will have to make will be based on an employee’s “pensionable earnings”.
Pensionable earnings has been defined as the lower of:
a) a member’s monthly wages, which includes ‘all emoluments payable to an employee’; and b) the Upper Earnings Limit (UEL) - which is equal to four times the National Average
Earnings (NAE).
Note: The 2014 National Average Earnings (“NAE”) has been gazetted by the NSSF as being KES 432,000 for 2014 for the purposes of determining the Upper Earnings Limit. Based on the annual NAE being KES 432,000, the monthly equivalent is KES 36,000. Therefore the monthly Upper Earnings Limit for 2014 is KES 18,000 (36,000 x 50% of monthly NAE= 18,000).
6.6 Tier I and Tier II contributions
Under the new NSSF Act, contributions shall be catergorised into Tier I and Tier II contributions:
a) Tier I contributions – both an employee and an employer make respective contributions at 6% of the employee’s monthly pensionable earnings up to the monthly Lower Earnings Limit (LEL). Tier I contributions are therefore capped to the lower of actual monthly wages and the LEL (the LEL has been confirmed as KES 6,000 per month for 2014).
b) Tier II contributions – both an employee and an employer make respective contributions at 6% of the employee’s pensionable earnings above the monthly LEL but capped to the monthly UEL limit (the UEL has been confirmed as KES 18,000 per month for 2014).
Therefore, contributions relating to the earnings below the LEL of the earnings (a maximum of KES 720) will be credited to what will be known as a Tier I account, while the balance of the contribution for earnings between the LEL and UEL (up to a maximum of KES 1,440) will be credited to what will be known as a Tier II account.
We have included in the Appendix, a summary diagram of how the new contributions will work and the options available to employees.
Therefore, the maximum contributions payable for 2014, once an employee’s pensionable earning exceed KES 18,000, will be KES 2,160 (i.e. KES 1,080 payable by an employee and KES 1,080 payable by an employer).
All Tier I and Tier II pension contributions are tax deductible for income tax purposes “despite any other written law”.
6.7 Contracting out by the employer
Tier I contributions are mandatorily payable to the NSSF.
Tier II contributions are payable to NSSF by the employer unless the employer “opts” to pay the Tier II contributions into an “approved contracted-out scheme” (i.e. occupational pension scheme or a private pension scheme) which meets a set criteria. An “opt-out” application must be made and approved by the Kenya Retirement Benefits Authority (“RBA”) in order for this to take effect.
6.8 Penalties for default contributions
Any person who wilfully misrepresents or fails to pay to the NSSF any amount which they are liable to pay under the new Act shall be liable to either:
a) a fine not exceeding KES 500,000, or b) imprisonment for up to 3 years; or c) both.
6.9 Transfer or secondment of an employee overseas
Where a Kenyan employer transfers or seconds an employee to work in another country for a period of up to three years, it shall be the responsibility of that employer to continue the remittance of both Tier I and Tier II contributions.
Where an employee works beyond a period of three years in the foreign country, it shall be the responsibility of the employer who transferred them to ensure that contributions payable on behalf of the employee are remitted in the foreign country where that employee works.
6.10 Exempt Individuals
The following individuals are entitled to an exemption from contributing to NSSF:
a) Exempt persons under any International Convention (for example a reciprocal Social Security Agreement / USAID-Kenya bilateral agreement / diplomats); OR
b) Persons who were not ordinarily resident in Kenya (i.e. who are employed in Kenya for periods not exceeding 3 years at any one time) and who are liable to contribute or are able to benefit from the social security fund of any country other than Kenya.
For persons not ordinarily resident in Kenya, approval must be sought from the Kenya Cabinet Secretary for Labour and Social Security and proof must be provided that such individuals are liable to contribute to, or shall be entitled to benefit from, the social security fund or similar body of another country.
6.11 Voluntary contributions
Individuals who do not satisfy the requirement for being an “eligible employee” for NSSF pension fund contribution purposes can choose to make voluntary contributions. Voluntary contributions must be a minimum of KES 200 and a minimum aggregate annual contribution of KES 4,800. All contributions should be made in cash (amounts less than KES 5,000) or through the NSSF M Pesa Business No.
333300.
6.12 Records of employees
Every contributing employer shall keep a written record of fund membership number and records of earnings of each of his contributing employees. A member statement can be obtained free of charge at the nearest NSSF office.
The Fund shall keep a record of an employee for a period of ten years after the Fund fully discharges its obligations to the member.
6.13 Submission of monthly returns
Every contributing employer shall each month submit to the Managing Trustee returns in the prescribed format and manner together with the contributions payable.
6.14 Failure to deduct contributions
An employer who fails to deduct contributions from an employee’s wages, shall be required to pay both shares of contributions.
6.15 Mode of payments
Employers are required to remit contributions through:
Cheques
Bankers cheques
Real Time Gross Settlements (RTGS)
Electronic Funds Transfers (EFT)
Cash subject to a maximum of KES 5,000 6.16 Benefits payable under the new Act
Two types of benefits will be created:
a) Benefits payable from the new Pension Fund, referred to as Pension Fund benefits; and b) Benefits payable out of the new Provident Fund and referred to as Provident Fund
benefits.
6.16 Pension fund benefits
Pension benefits available under the new Act are:
a) Retirement pension – payable to a member who:
has attained pensionable age (60 years); or
opted for early retirement having attained the age of 50 years.
b) Survivor’s benefit – payable to the dependents of a deceased employee if:
member dies before pensionable age, and
was contributing to the Pension Fund at the time of their death; and
not less than thirty six monthly contributions had been made before the date of death.
c) Invalidity Pension – payable if:
a member suffers physical or mental disability of a permanent total incapacity as certified by a medical board; and
not less than thirty six monthly contributions had been made before the date of invalidity.
d) Emigration benefit – benefit equal to a member’s Pension Fund Credit payable where:
An individual migrates from Kenya to another country which does not have a reciprocal social security agreement with Kenya; and
they do so without any present intention of returning to reside in Kenya.
e) Funeral grant – KES 10,000 will be payable to the next of kin of a member who had paid at least six monthly contributions before their death to assist in covering funeral expenses.
An application must be submitted not later than 60 days from the date of death.
6.17 Provident Fund benefits
Provident Fund benefits available under the new Act are:
a) Age benefit - payable if the member has attained the age of fifty years and has retired from gainful employment. The benefit payable shall be a lump sum equal to the member’s
Provident Fund Credit at date of entitlement to age benefit.
b) Survivor’s benefit – payable on death of a member. The dependent relatives of a member will be entitled to a lump sum survivors’ benefit equal to the member’s Provident Fund credit at the date of death.
c) Invalidity benefit - a member shall be entitled to this benefit if they are subject to such physical or mental disability as certified by a medical doctor.
d) Withdrawal benefit - lump sum withdrawal benefit equal to the member’s Provident Fund Credit at the date of withdrawal if at the time of claiming the benefit the member is no longer in self-employment.
e) Emigration benefit – payable under the same circumstances (described above under section 6.16).
6.18 How to apply for benefits
Application forms are free of charge, and may be obtained from the nearest NSSF office or downloaded from the website. Once completed, the application form must be submitted with the required supporting documents to the nearest NSSF office.
6.19 Impact on Employers and the challenges they may face
The net effect of the new rules will be an increase in the monthly contribution costs and administration costs for Kenyan employers. Additionally, employers will also need to ensure that they take the following into consideration:
Ensure that they have reviewed all employee records to ensure that qualifying employees are registered with NSSF where applicable. Additionally, the NSSF will be keen to ensure that there are no gaps in an employer’s historic contribution records as this may lead to an enquiry”;
Where there is an occupational pension scheme already in place, consider whether this will be a qualifying scheme for employees to contribute to as an alternative to NSSF;
Employers will therefore need to ensure that they seek professional advice before they embark on making an application for “opt-out”;
For expatriate staff, consider whether they satisfy the conditions for being exempt from making NSSF contributions and, if so, collate the information which will need to be provided in order to submit an application for exemption;
Ensure that payroll systems are updated and tested in order to be able to accurately calculate the new employer and employee contributions amounts; and
Promptly deduct and remit contributions in full by the 15th day of the following month.
Late payments of mandatory contributions shall attract a penalty at the rate of 5% of the contributions for each month or part of the month that is remitted late.
6.20 How can PwC help?
Some of the ways in which clients have been seeking our assistance on are:
Helping companies to ensure that all their employees are properly registered for NSSF contributions;
Reviewing the criteria that employers must meet for the RBA to approve opt-out applications where there is a “contracted out” scheme in place or where one will be set up;
Providing in-house training for Payroll/ HR/ Finance professionals so that they are aware of the requirements and obligations including drafting of communications to staff to advise them on how the new rules will impact them individually; and
Helping companies to assess whether their employees should direct their Tier II contributions to NSSF vs into an occupational scheme by performing a cost benefit analysis.
7. The Labour Relations
Act
Summary of the key Employment Acts in Kenya
7. The Labour Relations Act
This is an Act of Parliament intended to consolidate the law relating to trade unions and trade disputes and to provide for the registration, regulation, management and democratisation of trade unions and employers organisations or federations.
Its main aim is to promote sound labour relations through the protection and promotion of freedom of association, the encouragement of effective collective bargaining and promotion of orderly and expeditious dispute settlement which is conducive to social justice and economic development.
7.1 Important Definitions in the Act:
Board refers to the National Labour Board;
Collective agreement means a written agreement concerning any terms and conditions of employment made between a trade union and an employer or an organisation of employers;
Employer means any person, public body, firm, corporation or company, which has entered into a contract of service to employ any individual, and includes the agent, foreman, manager or factor of such person, public body, firm, corporation or company;
Employers’ organisation means any number of employers associated together for the
purpose, whether by itself or with other purposes, of regulating relations between employers and their employees or the trade unions representing those employees; and
Minister means the Minister of Labour, Social, Security and Services.
7.2 Employee rights
The Act provides for the following rights for every employee:
a) to participate in forming a trade union;
b) join a trade union; or c) leave a trade union.
Every member of a trade union has the right to:
a) participate in its lawful activities;
b) participate in the election of its officials and representatives;
c) stand for election and if elected or appointed, to hold office; and
d) stand for election or seek for appointment as a trade union representative and, if elected or appointed, to carry out the functions of a trade union representative in accordance with the provisions of this Act or a collective agreement.
7.3 Protection of employees
The Act also provides that no person should discriminate against an employee or any person seeking employment for exercising any right conferred in this Act. It prohibits any person from doing, or threatening to do any of the following:
Summary of the key Employment Acts in Kenya
a) require an employee or a person seeking employment not to be or become a member of a trade union or to give up membership of a trade union;
b) prevent an employee or person seeking employment from exercising any right advised by this Act or from participating in any proceedings specified in this Act; and
c) dismiss or, in any other way, prejudice an employee or a person seeking employment because of past, present or anticipated trade union membership.
7.4 Employer Rights
This legislation also gives every employer the right to participate in forming an employers’ organisation or a federation of employers’ organisation.
Every member of an employers’ organisation has the right, subject to the constitution of that employers’
organisation to:
a) participate in its lawful activities;
b) participate in the election of any of its office bearers or officials; and
c) stand for election or seek for appointment as an office bearer or official and, if elected or appointed, to hold office.
7.5 Protection of employers' rights
The Act prohibits any discrimination of any employer for exercising any right conferred by the Act.It also prohibits any person from doing, or threatening to do any of the following:
a) require an employer not to be or become a member of an employers' organisation or to give up membership of an employer organisation;
b) prevent an employer from exercising any right conferred by this Act or from participating in any proceedings specified in this Act;
c) in any way prejudice an employer.
7.6 Officials of trade unions and employers’ organisation The Act also states that an official of a trade union shall be:
a) persons who are, or have been, engaged or employed in the sector for which the trade union or employers’ organisation is registered; and
b) an official of no more than one trade union or employer’s organisation.
An official of a trade union may also be an official of a federation of trade unions to which the trade union is affiliated.
Notwithstanding the above provisions:
a) the general secretary of a trade union / chief executive / association secretary of an employers’
organisation may be a person who is not engaged or employed in the sector concerned; and b) a person may be an official of more than one employer’s organisation.
No person who has been convicted of a criminal offence involving fraud or dishonesty shall be an official of a trade union or employer’s organisation.
Summary of the key Employment Acts in Kenya 7.7 Voting members of trade union
No person shall be a voting member of:
a) a trade union unless that person is employed in the sector for which the trade union is registered;
b) an employers’ organisation unless that person has a physical address or an office in Kenya; or
c) a registered trade union or employer’s organisation if that person’s membership (trade union dues) subscriptions are more than thirteen weeks in arrears.
7.8 Deduction of trade union dues
“Trade union dues” means a regular subscription required to be paid to a trade union by a member of the trade union as a condition of membership.
A trade union may, in the prescribed form, request the Minister to issue an order directing an employer of more than five employees belonging to the union to:
a) deduct trade union dues from the wages of its members; and b) pay such monies into the specified account of the trade union.
Where such an order is made by the Minister, the employer in respect of whom the Minister has issued an order as specified above shall commence deducting the trade union dues from an employee’s wages within thirty days of the trade union serving a notice in respect of whom the employer is required to make a deduction.
7.9 Deduction of agency fees from unionisable employees covered by collective agreements A trade union that has concluded a collective agreement with an employer for all unionisable
employees covered by the agreement may request the Minister to issue an order requiring any employer who is bound by the collective agreement to deduct an agency fee from the wages of each unionisable employee covered by the collective agreement and who is not a member of the trade union.
A member of a trade union covered by a collective agreement who resigns from the union is immediately liable to have an agency fee deducted from his wages in accordance with this section.
7.10 Payments by members to employers’ organisations
An employers’ organisation may provide in its constitution for its members to:
a) pay subscriptions or levies as a condition of their membership of the employers’ organisation;
and
b) to charge its members a fee for services rendered to, and expenses incurred on behalf of the member.
7.11 Collective agreements
An employer or an employers’ organisation that has recognised a trade union shall conclude a collective agreement with the recognised trade union setting out terms and conditions of service for all
unionisable employees covered by the recognition agreement.
Summary of the key Employment Acts in Kenya
An employer shall disclose to a trade union all relevant information that will allow the trade union to effectively negotiate on behalf of employees. All the information disclosed is confidential and shall not be disclosed by any person to a person who is not engaged in the negotiations.
7.12 Effect of collective agreements
A collective agreement shall continue to be binding on an employer or employees who were parties to the agreement at the time of its commencement and includes members who have resigned from that trade union or employer association.
The terms of the collective agreement shall be incorporated into the contract of employment of every employee covered by the collective agreement.
A collective agreement shall be in writing and shall be signed by:
a) the chief executive officer of any employer, the chief executive or national secretary of an employers' organisation that is a party to the agreement or a representative designated by that person; and
b) the general secretary of any trade union that is a party to the agreement or a representative designated by the general secretary.
A collective agreement becomes enforceable and shall be implemented upon registration by the Industrial Court and shall be effective from the date agreed upon by the parties.
7.13 Registration of collective agreement
Every collective agreement shall be submitted to the Industrial Court for registration within fourteen days of its conclusion.
The employer or employer’s organisation which is party to an agreement to be registered under this section shall submit the agreement to the Industrial Court for registration.
If an employer or employers’ organisation fails to submit the collective agreement to the Industrial Court as specified above the trade union may submit it.
7.14 Reporting of trade disputes to the Minister
A trade dispute may be reported to the Minister in the prescribed form and manner by either an authorized representative of the employer or of the trade union. The Act outlines the procedure of reporting trade disputes to the Minister.
This mode of dispute resolution allows every party to a trade dispute to file a replying statement in the prescribed form and manner with the Minister within 14 days of receiving a copy of the report of the dispute.
The Minister is empowered to appoint conciliators in order to attempt and reconcile the disputing parties. If a trade dispute is settled in conciliation the terms of the agreement shall be:
a) recorded in writing; and
b) signed by the parties and the conciliator.
A signed copy of the agreement shall be lodged with the Minister as soon as it is practicable.
Summary of the key Employment Acts in Kenya 7.15 Referral of dispute to Industrial Court
If a trade dispute is not resolved after conciliation, a party to the dispute may refer it to the Industrial Court in accordance with the rules of the Industrial Court. A trade dispute may only be referred to the Industrial Court by the authorised representative of an employer, group of employers, employers' organisation or trade union.
7.16 Protected strikes and lock-outs For purposes of this Act, a strike means:
a) the cessation of work by employees acting in combination; or
b) a refusal under a common understanding of employees to continue to work for the purpose of compelling their employer; or
c) an employers’ organisation of which their employer is a member to accede to any demand in respect of a trade dispute.
A person may participate in a strike or lock-out if:
a) the trade dispute that forms the subject of the strike or lock-out concerns terms and conditions of employment or the recognition of a trade union;
b) the trade dispute is unresolved after conciliation under this Act or as specified in a registered collective agreement that provides for the private conciliation of disputes; and
c) seven days written notice of the strike or lock-out has been given to the other parties and to the Minister by the authorised representative of the trade union (in the case of a strike) or the employer, group of employers or employers’ organisation (in the case of a lock-out).
7.17 Prohibited strikes or lock-outs
No person shall take part in a strike or lock-out or in any conduct in contemplation of a strike or lock-out if:
a) any law, court award or a collective agreement or recognition agreement binding on that person prohibits a strike or lock-out in respect of the issue in dispute;
b) the subject matter of the strike or lock-out is regulated by a collective agreement or recognition agreement binding on the parties to the dispute;
c) the parties have agreed to refer the trade dispute to the Industrial Court or to arbitration; or d) the trade dispute was not referred for conciliation in terms of this Act.
7.18 Strike or lock-out in compliance with this Act
A “protected strike” means a strike that complies with sections 7.16 and 7.17 above.
An employer may not dismiss or take disciplinary action against an employee for participating in a protected strike. An employer is not obliged to remunerate an employee for services that the employee does not render during a protected strike or lock-out.
7.19 Strike or lock-out not in compliance with this Act
A person who refuses to take part or to continue to take part in any strike or lock-out that is not in compliance with this Act may not be:
