Court permits KCB to pay annual management bonuses

Written By: Beth Nyaga
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Court permits KCB to pay annual management bonuses
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The Employment and Labour Relations Court of Kenya on Thursday permitted the KCB to pay out bonuses to its managerial staff in Kenya.

The Court also varied its previous orders to permit the payment of bonuses to KCB’s group members outside Kenya aside from its staff who are members of the Banking, Insurance and Finance Union (K) (BIFU).

BIFU had initially had their case against KCB temporarily stayed and submitted to conciliation as required under Kenya’s employment laws.

The union, representing KCB’s unionisable staff, had alleged that KCB’s use of quarterly performance reviews in determining annual bonuses was unfairly discriminative.

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However, the union of banking workers obtained ex parte orders preventing the payment of annual bonuses when KCB sought to pay bonuses to its 2279 management staff, who are not union members.

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MMC Africa Law indicated on behalf of the bank that its use of balanced score cards to assess staff performance has been in use since 2005 to objectively reward employee performance.

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“The issue of payment of bonuses to management staff specifically was not in dispute in the conciliation proceedings, and should not have been subject to the court’s orders issued on 21st March 2018,’’ said Peter Munge of MMC Africa Law.

KCB further argued that the management staff of KCB in other countries were not party to the suit or in the jurisdiction of the Kenyan court and thus it was unfair to subject them to the Kenyan court’s decision.

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“The court does not have jurisdiction over the banking group’s staff in Uganda, Tanzania, Burundi, Rwanda, South Sudan. The previous orders had also affected the payment of bonuses to staff working for KCB Capital Limited, KCB Foundation and KCB Insurance Agency Limited.’’ Added Peter Munge of MMC Africa Law.

The court further ordered that a sum of Sh240, 721,905 be deposited in an escrow account, pending the final determination of the suit.

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