Workers who were affected by the ongoing restructuring of State-owned sugar companies will be reskilled and redeployed, the government has announced.
Labour and Social Protection Cabinet Secretary Alfred Mutua confirmed the developments while appearing before the Senate Plenary on Wednesday, October 29, where he revealed the move was part of a wider government agenda to restore efficiency and sustainability in the sugar industry, which has been marred by operational and financial challenges in recent years.
“To safeguard the livelihoods of retrenched workers, the Ministry has initiated plans to reskill and redeploy affected employees," Mutua told the Senate.
He added, "In accordance with the MoU, all workers will remain in employment for 12 months from May 2025, during which lessees will absorb up to 80 per cent of the current workforce,” the CS said.
Earlier in October, thousands of workers at four state-owned sugar factories took legal action against redundancy notices issued following the leasing of mills to private operators.
The employees who stem from South Nyanza (Sony), Chemelil, Muhoroni, and Nzoia sugar companies insisted that discussions over their terminal benefits and other entitlements were still ongoing.
But Mutua defended the discharge of a section of employees from the leased companies, stating that the process was being implemented in full compliance with Section 40 of the Employment Act, which outlined procedures for redundancy.
Part of the redundancy procedures includes prior notification, justification of termination and payment of all dues owed.
Mutua further revealed that negotiations between the Ministry of Agriculture, the Kenya Sugar Board, the National Treasury, and the Kenya Union of Sugar Plantation Workers resulted in the signing of a Memorandum of Understanding on May 7 to guide the mass layoffs.
The agreement, according to Mutua, ensured fairness and transparency while providing for the absorption of most of the affected workers by new investors.
A total of 1743 employees in Kisumu County have been affected by the restructuring of Chemelil, Muhoroni, and Miwani sugar companies, with the government embarking on the process of clearing their salary arrears.
For the period between May and August 2025, the government made partial payments amounting to Ksh1.8 billion in salary arrears. The remaining KSh3.8 billion in arrears and Ksh15 billion in terminal dues are expected to be settled by June 2026.
Meanwhile, a transition committee comprising officials from the Ministries of Agriculture and Treasury, county governments and union representatives is overseeing the process.
Amid the Senate's concerns, Mutua affirmed that the government was legally obligated to settle all dues owed to both existing and retained employees and to uphold labour practices under Article 41 of the Constitution.
