Fairtrade faults layoffs, calls for better wages by Kenyan companies

Global organization for sustainable and equitable trade, Fairtrade, has expressed concerns over the growing rates of lay-offs and outsourcing of labour in the country, while calling on Fairtrade certified companies to raise wages for their workers.

Fairtrade champions better prices for producers in developing countries when they access markets in developed countries, in exchange for the producers providing better welfare for workers and smallholder farmers they engage.

The organization has noted that workers in the flower sector among those most affected by low wages, where they are earning less than half of the cost of living.

It has also expressed need for evaluation of the enforcement of safe workplaces in the country, particularly the agricultural sector, following release of an alarming report about sexual harassment in tea firms by the BBC.

Living standards

“Fairtrade is concerned that it has become relatively easy it seems for Kenyan employers to lay-off workers, reduce working hours or terminate the employment of workers for outsourced labour or term contractors. We see the reason for stricter rules to protect workers against arbitrary layoffs and terminations, whatever the number of workers involved,” the organization said.

Fairtrade Africa Programmes Director, Mr Chrispinus Oluoch, challenged Fairtrade certified producers in the country to better wages for their workers, since they are beneficiaries of premium prices fetched in the western markets due to the certification, with an expected spiral effect to communities where they operate.

Companies certified by the organization sell produce at premium prices and are expected to use the high earnings to pay workers well, which would have an impact in their lives by enabling them access better education, healthcare and general living standards.

“Expectations for Fairtrade to come up with a solution to close the Living Wage gap is high. We are working on having a coherent strategy on Living Wage to capture momentum based on learnings from pilots that have been conducted on banana and flower plantations, and outcomes from living income pilots over the past couple of years. We continue to pursue projects that further improve labor conditions and Fairtrade’s impact beyond the Fairtrade standards – to deepen our impact,” Mr Oluoch said.

Cost of living

The organization recognizes Kenya’s flower industry as vital for Kenya and the regional economy, but also one that continues to face deep scrutiny over its labour practices, particularly in the area of wages. 

It says there is need for a raise of wages for workers in the industry, due to the cost of living that has been witnessed over the past several years.

“In the case of Kenya and many other origins of Fairtrade product where statutory minimum wages have not kept up with costs of living, we think it is advisable to regularly review and update minimum wages. One of the fundamental human rights is the right to a just remuneration that ensures an existence worthy of human dignity,” Fairtrade said.

A study conducted last year by the Anker Research Institute showed that in Naivasha, while the cost of realizing basic but decent livelihood was Sh32,488 per month, the legal minimum wage was less than half of that, at Sh15,120.

“Buyers of Fairtrade products pay an additional sum for Fairtrade premium, a social benefit that comes with Fairtrade certification. Smallholder farmers and workers from Fairtrade certified farmer organisations and plantations can pool the Fairtrade premium received and invest those to match the needs of their constituencies. The social impact of Fairtrade Premium is linked to the volume of Fairtrade sales, which also makes clear that this is not charity but ethical trade,” the organization said.