By Tingting Zhu
Trade unions always incite workers to make trouble, and ask us for more money. They really cause me a headache.” That is the commonly held perception of trade unions by project managers of Chinese construction companies in Kenya.
According to the Kenya Labor Relations Act, a trade union is an association of employees whose principal goal is to regulate relations between employees and employers. Employees have the right to join (or withdraw from) unions, and employers must not force or induce employees to join (or withdraw from) unions for any reason or excuse.
There are 52 trade unions in Kenya that exist in different industries. For example, workers of construction companies tend to join the Kenyan Building Construction, Timber and Furniture Industries Employees Union (hereinafter referred to as the K.B.C.T&F.I. Employees Union). By now, employees from more than 10 China Construction Companies have joined the union.
According to the 2016 Africa Infrastructure Trend Report released by Deloitte, China is the largest contractor and financier of infrastructure construction in East Africa. According to the report, 41.9% of infrastructure projects under construction in the country were initiated by Chinese companies. Local Kenyan companies ranked second, with their construction projects accounting for 25.6% of all undergoing projects. In Kenya, there are many infrastructure construction companies from China, including large state-owned construction companies, small and medium-sized state-owned construction companies, and private construction companies.
Due to the differences in legal systems between Kenya and China, Chinese construction companies have encountered numerous labor problems with Kenyan employees, and more importantly, with local Kenyan trade unions. “Kenyan workers are very different from Chinese workers. They have a strong legal awareness. They usually do not work overtime on weekends. If they work overtime, they will ask for double wages. If the company does not pay overtime, they will go to the union, the Kenyan Ministry of Labour and the Court. They often go on strike, using stones to smash the office and blocking the Chinese managers’ cars. Strikes are always my nightmare,” a manager of a medium-sized Chinese construction company complained.
The officer of the K.B.C.T&F.I Employees Union divides Chinese construction companies into two categories, one is willing to communicate with the union, willing to sign a Collective Bargaining Agreement; the other one refuses to cooperate with the union. They not only ignore the labor union; when the Ministry of Labor called their office, they pretended to not speak English. The cooperative Chinese companies mentioned above are large-scale state-owned Chinese enterprises. They have a sound legal compliance department, and have set up specialized agencies to deal with the company’s legal affairs, including communication and coordination with the trade unions. These companies are familiar with Kenyan laws and have a clear understanding of the nature of Kenyan trade unions. The uncooperative companies are mainly small and medium-sized construction companies, including provincial construction companies and private construction companies. Such companies often lack a sound legal compliance system and do not have a dedicated agency or consultant to handle legal matters; instead those issued are often handled by in-house human resources managers.
Since trade unions usually fight for members’ rights in the form of organizing or supporting strikes, the cooperative companies will choose to negotiate with the trade unions in order to not affect the progress of the construction and maintain a positive corporate image. However, uncooperative companies pay more attention to the economic benefits and are therefore reluctant to accept requests from the unions, such as requests to have a higher salary package. In their opinion, the companies have already met the minimum salary standard set by Kenyan government.
When the Kenyan Ministry of Labor officials talked about the Chinese construction company, they said, “Chinese companies want to save costs.” The officials gave a set of data: when Kenya’s national minimum wage for cleaners was set at 12,926.55 KSh per month, the union proposed to increase it to 14,865 KSh. In this scenario, the company would increase the labor cost by at least 15% per month.
Cooperative companies respond to trade unions’ requests favorably mainly by signing a Collective Bargaining Agreement (CBA). The agreement is valid for two years. When an employer signs a CBA with a trade union, it means that the employer recognizes the trade union as an independent organization representing the interests of its members. The union’s officer is proud to say that, one of his achievements is that he has recently signed a CBA with a large Chinese construction company, which has increased workers’ salaries by 9%. This is much higher than the government’s 5% annual increase. Uncooperative companies believe that they will be easily manipulated by the union after signing a CBA. “I will never sign the CBA. I can handle the strikes by myself,” Mr. Wang, a project manager of a Chinese private construction company, explained when discussing his company doesn’t cooperate with unions. “The union even required us to arrange an independent office for the trade union representatives. This is ridiculous.”
According to the principle of absolute majority, if the majority of company employees join the union, the company must sign the CBA. Ms. Li, a manager of a Chinese construction company, said, “In order to keep the number of union members below the majority line, I expelled employees who joined the union for other reasons. In terms of recruitment, I also refuse to accept those who belong to the union, so I can control the proportion of employees who join the union.” When some Chinese companies first came to Kenya, they always compromised and met workers’ demands in strikes. But when the strikes became more frequent and unpreventable, Chinese companies reconsidered their responses, and concluded that compromises would only indulge more unreasonable requests.
Mr. Li smiled bitterly, “We deal with strikes with the ‘cold treatment,’ that is, to suspend the progress of the project, ignoring their requests. We will stop the project for a few days. If they don’t work, they will have no wages, and as a result, they won’t be able to support their families, and then they will automatically stop the strike and continue to work.” The general manager of another Chinese construction company added that, “We don’t need the trade union. Strikes can be solved internally. I asked workers to select five representatives to negotiate with the company, and then I invited the Officials of Kenyan Ministry of Labor to our site as witnesses. After four rounds of negotiations, we reached an agreement in the witness of those officials. Since then, the trade union has never come here.”
There are also companies that would create separation within the strike group to weaken its unity. The manager of a small Chinese construction company said, “I will talk to the leader alone, satisfy his demands, and let him point out the particular person who wants to continue the strike, then I will fire this worker for other reasons.” Chinese construction companies have foreseen the effectiveness of alienating the union. According to the Kenya Labor Relations Act, the K.B.C.T&F.I Employees Union collects 2.5% of a member’s fixed salary as a membership fee monthly. A general manager of a Chinese construction company said, “Trade union members pay their dues every month, but since we don’t allow unions to intervene at all, the fees can’t bring workers real benefits. These workers will naturally withdraw from the union.”
Despite all the strategic moves against trade unions, Chinese managers emphasize that it is their positions that decide their perspectives; they would have no inclination to demonize trade unions if they were Kenyan employees. Mrs. Zhang, a manager of a medium-sized state-owned construction company, said that, “As a manager of the company, I need to consider the economic interests of the company, so I don’t like the trade union. But at the same time, I am also a Chinese employee of a Chinese company in Kenya. Without the protection of trade unions, there is no channel to reflect my own demands. At this point, I do hope that Chinese employees can have a trade union in Kenya that can speak for us.”