The government has committed to clear Sh.1.9 billion in verified salary arrears owed to workers of four former state-owned sugar mills.
Agriculture Principal Secretary (PS) Kiprono Ronoh said the move signals a fresh push to settle legacy liabilities following the leasing of the factories to private millers.
Speaking at Chemelil Sugar Company in Kisumu, the PS said the arrears had been fully audited and provided for in the national budget, paving the way for payment to employees who were originally hired by the government before the mills were handed over to private investors.
“During the handover of the four sugar mills, the government undertook to absorb part of the liabilities, including employee salary arrears,” the PS said.
“The audited amount stands at Sh1.9 billion and the funds have now been set aside to ensure all verified arrears are paid,” he said.
Ronoh said the State had already settled other outstanding obligations linked to the transition, adding that statutory deductions owed to workers were also undergoing audit and would be cleared once verified.
He said employees who were not absorbed by the new millers would be given priority during the payment of the audited arrears.
He urged workers to remain patient as the government concludes the process, noting that the leasing programme was designed to stabilise the struggling sugar sector and unlock new investment.
According to the PS, more than 80 per cent of the workforce had already been absorbed by the new operators, with employment expected to rise sharply as the mills scale up production.
“Previously, the four mills employed about 3,500 workers. Based on the plans presented by the millers, we are looking at employment growing to about 10,000,” he said, calling on investors to hire more workers, particularly youth, to support sector recovery.
The PS also assured suppliers and farmers that their debts had been audited and would be paid.
He said the government had cleared most farmers’ arrears, with only limited balances remaining under specific millers.
He further called on farmers to support the rollout of 27 new sugarcane varieties developed by the Kenya Sugar Research Institute, saying the new varieties would improve productivity, raise earnings and reduce post-harvest losses associated with old cane strains that have been in use for decades.
However, the Kenya Union of Sugar Plantation and Allied Workers (KUSPAW) challenged the government’s assurances, saying workers had yet to see concrete timelines for payment of the arrears.
KUSPAW Chemelil Branch Assistant Secretary James Omondi said the pronouncement by the PS did not adequately address the hardships faced by employees since the leasing of the mills to private investors on May 7, 2025.
“Employees have gone through extreme challenges following the leases, and there is no clear commitment on when these arrears will be paid,” Omondi said, describing the government’s position as unsatisfactory.
The union also disputed claims on worker absorption at Chemelil Sugar Company, saying only about 399 employees had been retained by the investor, contrary to earlier figures presented during the transition.
Omondi further argued that some workers were declared redundant before being paid their dues, saying this contravened provisions of the Employment Act that require full settlement of entitlements prior to redundancy.
He appealed for intervention by President William Ruto to fast-track payment of the Sh1.9 billion arrears, warning that prolonged delays risk deepening unrest in the sugar sector.
By Chris Mahandara
