Troubled East African Portland Cement Company (EAPCC) #ticker:EAPCC has been given 30 days to deposit Sh350 million in court as a condition to suspend an order allowing the sale of its property to recover Sh1.4 billion it owes workers.
Court of Appeal judges, while suspending the decree by the Employment and Labour Relations Court on September 14, noted that there are no practical ways for EAPCC to recover the colossal sum from workers in the event its property is sold but gave a stringent condition to the struggling firm.
The Labour Court had on August 2 allowed the Kenya Chemical and Allied Workers Union (Kcawu) to recover the colossal sum that Portland owes more than 400 workers under the 2013–2015 CBA, prompting the firm to seek the Court of Appeal’s protection.
“The applicant must deposit in court or provide a bank guarantee in the sum of Sh350 million being approximately 25 per cent of the decretal sum,” the judges ruled, adding that the said deposit or bank guarantee “shall be provided within 30 days or the conditional stay shall automatically lapse.”
EAPCC had in its application pleaded with judges Martha Koome, Hannah Okwengu and J. Otieno-Odek to suspend the decree pending the appeal, arguing that some of the items attached constitute tools of trade.
Portland said attachment of those tools would cripple its business operations making it difficult to meet its obligations.
The union, however, urged the court to deny the cement maker any reprieve, arguing that the firm had not advanced any solid grounds in its appeal.
The judges, however, noted that arguable grounds had been established to warrant granting of reprieve even as they maintained that the stay of execution would lapse with EAPCC’s failure to provide the Sh350 million guarantee.
The decree to recover Sh1,401,585,364 emanates from a long-running dispute arising from EAPCC’s failure to fully implement the collective bargaining agreement (CBA).
The said CBA was the subject of a dispute before the Labour Court and the Court of Appeal.
Portland Cement was particularly aggrieved by the court’s directive that it increases the wages of contract employees.
The court held that the contract staff, who were not part of management and are members of Kcawu by payment of union dues, were entitled to benefit from the negotiated CBA.
EAPCC’s argument that there were separate negotiations for non-management workers, some of who were on contract and others not, was rejected.
The Labour Court found that payment of union dues is what makes an employee a member of a trade union.
Portland had conceded that the dues paid to staff on contract are different from that paid to permanent employees though unionisable.
The reason EAPCC advanced for this was that putting the wages on the same level is unsustainable and if implemented would require Sh71.3 million per month that it was unable to raise. EAPCC and Kcawu have negotiated CBAs since 1961. However, the contract employees were not covered by the CBA until 2011.
World Bank pushes G-20 to extend debt relief to 2021
World Bank Group President David Malpass has urged the Group of 20 rich countries to extend the time frame of the Debt Service Suspension Initiative(DSSI) through the end of 2021, calling it one of the key factors in strengthening global recovery.
“I urge you to extend the time frame of the DSSI through the end of 2021 and commit to giving the initiative as broad a scope as possible,” said Malpass.
He made these remarks at last week’s virtual G20 Finance Ministers and Central Bank Governors Meeting.
The World Bank Chief said the COVID-19 pandemic has triggered the deepest global recession in decades and what may turn out to be one of the most unequal in terms of impact.
People in developing countries are particularly hard hit by capital outflows, declines in remittances, the collapse of informal labor markets, and social safety nets that are much less robust than in the advanced economies.
For the poorest countries, poverty is rising rapidly, median incomes are falling and growth is deeply negative.
Debt burdens, already unsustainable for many countries, are rising to crisis levels.
“The situation in developing countries is increasingly desperate. Time is short. We need to take action quickly on debt suspension, debt reduction, debt resolution mechanisms and debt transparency,” said Malpass.
Kenya’s Central Bank Drafts New Laws to Regulate Non-Bank Digital Loans
The Central Bank of Kenya (CBK) will regulate interest rates charged on mobile loans by digital lending platforms if amendments on the Central bank of Kenya Act pass to law. The amendments will require digital lenders to seek approval from CBK before launching new products or changing interest rates on loans among other charges, just like commercial banks.
“The principal objective of this bill is to amend the Central bank of Kenya Act to regulate the conduct of providers of digital financial products and services,” reads a notice on the bill. “CBK will have an obligation of ensuring that there is fair and non-discriminatory marketplace access to credit.”
According to Business Daily, the legislation will also enable the Central Bank to monitor non-performing loans, capping the limit at not twice the amount of the defaulted loan while protecting consumers from predatory lending by digital loan platforms.
Tighter Reins on Platforms for Mobile Loans
The legislation will boost efforts to protect customers, building upon a previous gazette notice that blocked lenders from blacklisting non-performing loans below Ksh 1000. The CBK also withdrew submissions of unregulated mobile loan platforms into Credit Reference Bureau. The withdrawal came after complaints of misuse over data in the Credit Information Sharing (CIS) System available for lenders.
Last year, Kenya had over 49 platforms providing mobile loans, taking advantage of regulation gaps to charge obscene rates as high as 150% a year. While most platforms allow borrowers to prepay within a month, creditors still pay the full amount plus interest.
Amendments in the CBK Act will help shield consumers from high-interest rates as well as offer transparency on terms of digital loans.
Scope Markets Kenya customers to have instant access to global financial markets
NAIROBI, Kenya, Jul 20 – Clients trading through the Scope Markets Kenya trading platform will get instant access to global financial markets and wider investment options.
This follows the launch of a new Scope Markets app, available on both the Google PlayStore and IOS Apple Store.
The Scope Markets app offers clients over 500 investment opportunities across global financial markets.
The Scope Markets app has a brand new user interface that is very user friendly, following feedback from customers.
The application offers real-time quotes; newsfeeds; research facilities, and a chat feature which enables a customer to make direct contact with the Customer Service Team during trading days (Monday to Friday).
The platform also offers an enhanced client interface including catering for those who trade at night.
The client will get instant access to several asset classes in the global financial markets including; Single Stocks CFDs (US, UK, EU) such as Facebook, Amazon, Apple, Netflix and Google, BP, Carrefour; Indices (Nasdaq, FTSE UK), Metals (Gold, Silver); Currencies (60+ Pairs), Commodities (Oil, Natural Gas).
The launch is part of Scope Markets Kenya strategy of enriching the customer experience while offering clients access to global trading opportunities.
Scope Markets Kenya CEO, Kevin Ng’ang’a observed, “the Sope Markets app is very easy to use especially when executing trades. Customers are at the heart of everything we do. We designed the Scope Markets app with the customer experience in mind as we seek to respond to feedback from our customers.”
He added that enhancing the client experience builds upon the robust trading platform, Meta Trader 5, unveiled in 2019, enabling Scope Markets Kenya to broaden the asset classes available on the trading platform.