Social Justice in Kenyan Parastatals

Peter Maina Gichangi

MIT8205: Business Ethics and Governance

Term Paper:

Social Justice In Kenyan Parastatals – KRA Case Review


FIT/ Msc. IT /060673

Term Paper: MIT8205: Business Governance and Ethics of 15


Table of Contents

1 Introduction.......................................................................................3

2 Problem Statement............................................................................3

3 The Case...........................................................................................4

3.1 What is Social Justice?..............................................................4

3.2 Background of the KRA............................................................5

3.3 The KRA Work Place................................................................6

3.3.1 Remuneration....................................................................6

3.3.2 Benefits and perks.............................................................7

3.3.3 Career growth opportunities..............................................7

3.3.4 Sponsored trainings and seminars.....................................7

3.3.5 Performance recognition and awards................................8

4 Ethical and Governance Problems....................................................9

4.1 Natural Moral Law....................................................................9

4.2 Virtues.......................................................................................9

4.3 Subsidiarity................................................................................9

4.4 Stakeholder theory.....................................................................9

5 Problem Analysis............................................................................10

6 Conclusion......................................................................................11

7 References.......................................................................................12



1 Introduction

After the Kenyan independence in 1963, Kenyans slowly started

assuming public offices in various capacities. Over time the larger

percentage of public offices were run by qualified locals. This marked a

radical change in the discrimination that was then rampant. This was

primarily racial discrimination where locals were less likely to get good

employment opportunities when pit against ‘whites’ and Asians. This

was considered to be ‘Kenyanisation’ of government structures and

services. This was seen as the beginning of equal opportunities to all and

was expected to reflect in government owned institutions through the

employment terms, additional perks and benefits, growth opportunities

among others.

More than forty seven years later, the anticipated equal opportunities in

government owned institutions still seem to be elusive.

2 Problem Statement

More than thirty seven years after independence, the social justice and

equity expected in state owned institutions seems yet to have been

achieved. Though racial based discrimination is no longer a concern,

other forms of social injustice have arisen. These have led to

dissatisfaction of some employees since they feel that there is a lack of

equity and justice.



3 The Case

This paper is based on practices common within the Kenya Revenue

Authority (KRA) which may hinder social justice at the work place. It

will focus on the ethical and corporate governance aspects emanating

from these practices.

This review shall focus on the key areas listed below in an attempt to

identify basic conflicts and the fulfilment of social justice:

Remuneration

Benefits and perks

Career growth opportunities

Sponsored trainings

Sponsored professional seminars

Performance recognition and awards

Gender bias

Persons with disability

3.1 What is Social Justice?

For the purpose of this paper, Social Justice is defined as the just

distribution of resources, tools of work, rewards and opportunities to the

employees within an organisation. It borders on the principles of natural

moral law, equality and solidarity.



3.2 Background of the KRA

Established in 1995 via an act of parliament for the primary purpose of

revenue collection, KRA is charged with the responsibility of managing

the tax framework within Kenya. The institution oversees

implementation of the taxation plans proposed by the Ministry. It is

further required to implement tax collection mechanisms that will collect

the revenue expected.

The KRA currently employs over four thousand staff across various

departments spread in multiple towns all over Kenya. These departments

include:

Income Tax Department

Customs and Excise Department

Value Added Tax Department

Registrar of Motor Vehicle Department

Support Departments

o Legal Affairs Internal Audit

o Research and Corporate Planning

o Management of Information Services

o Investigations

o Human Resource and Administration

o Finance

o Public Relations -now Corporate & Public Affairs

o Revenue Protection Services



o Tax Programmes & New Business Initiatives

The KRA presents itself as an equal opportunity employer offering

opportunities for growth, development and job satisfaction.

3.3 The KRA Work Place

Across the various KRA offices, multiple and diverse work ethics are

practiced. The busiest offices are the KRA headquarters in Nairobi and

the Mombasa regional office. In the review carried out, similarities were

identified across most of the offices in regards to the various areas of

interest. The general findings are shown below.

3.3.1 Remuneration

KRA has a salary scale that is used to determine the remuneration of

employees. The Commissioner General is at Level 1 with the levels

increasing as seniority decreases. Level 1 is the most highly paid with the

commissioner having a salary of over Kshs. 1 million.

Through an appraisal program, employees are promoted (mostly based

on their performance) to the next level. This often calls for a new job

description, job enrichment (with additional roles) or even job rotation.

It was identified that some employees were not happy with the entire

remuneration packages and review process largely because of poor

adherence to processes. This caused great disparities between employees

performing the same tasks but who have been promoted in the past

without a change in roles or job description and without following



performance merit. This has caused a lot of acrimony among employees

often to the extent that team work fails.

3.3.2 Benefits and perks

It was noted that the authority provides multiple and varied benefits and

incentives to its employees. However, great disparities were identified

where in some instances certain employees were awarded benefits while

their peers were not provided the same. The health insurance benefits are

a good example where some employees are given a broader cover while

their peers (at the same level) are given less. Bonuses were also

identified where in some instances some employees were awarded

bonuses while their counterparts were not.

This has created dissatisfaction, low productivity and corruption amongst

those who felt unfairly treated.

3.3.3 Career growth opportunities

The issue of growth opportunities at KRA caused passionate emotions

amongst most of the employees. It was generally felt that growth

opportunities were never fairly contested since the qualifications were

often tailored to suite a pre-determined candidate. It was generally felt

that the process was flawed and failed to follow the basic governance

principles expected.

This has created dissatisfaction and indifference among employees who

feel they cannot get a ‘god father’ to assist their growth.



3.3.4 Sponsored trainings and seminars

As in many government institutions, sponsored trainings and seminars

arouse a lot of debate since they are viewed as opportunities to make

money – per diem. As such the competition among peers to attend

trainings is very high. In some instances, some managers arrange for

trainings for given employees and exclude others who are performing the

same tasks. The method of selection and identification of the employees

to attend the trainings is also not clear.

As a result, the process is marred in corruption as individuals attempt to

get themselves included in the trainings. Employees who often miss out

on these opportunities seek alternatives to make additional money from

their work. This leads to even more corruption.

3.3.5 Performance recognition and awards

Almost every year, KRA recognises its best performing staff at an

official function by giving them awards. The process of selection of best

performing staff is however not clear and often sees managers

nominating themselves for the awards.

As a result, the actual well performing employees loose moral causing

reduced productivity. Over time, these employees may seek

opportunities elsewhere.



The above identified issues are the five key concerns that indicate

social justice is yet to be achieved within KRA and by extension

other parastatals.

4 Ethical and Governance Problems

The issues identified above reveal multiple ethical and governance

problems within KRA. These problems are explained below.

4.1 Natural Moral Law

Ethical problems around justice are evident from the issues identified

above ranging from sick-off requests so as to fulfil their personal duties,

false information about best performing employees among others.

4.2 Virtues

Ethical problems around virtues are exposed from the above issues where

employees are involved in corruption, favouritism, nepotism,

absenteeism among others.

4.3 Subsidiarity

In instances where employees are not involved in basic decisions such as

identifying the best performing employees, then the principle of

subsidiarity is not fully practiced. As such, most decisions are made at

senior management level, some of which are very basic thus making

them loose focus of the bigger picture.



4.4 Stakeholder theory

It is clear from the findings above that the stakeholders within KRA have

not been fully appreciated. Their role, their plight and their impact on

KRA’s image and performance have been ignored. As such it would

seem more learning and incorporation of tenets from the stakeholder

theory are required within the organisation for proper transformation to

be achieved.

5 Problem Analysis

The impact of the social injustices at the work place cannot be ignored.

According to Cropanzano et al. (Cropanzano, Byrne, Bobocel, & Rupp,

2001), social injustices at the work place have been attributed to multiple

challenges facing organisations. Such challenges include reduced

productivity, reduced morale, indifference at the work place, reduced

enthusiasm, general dissatisfaction, intimidation, corruption, absenteeism

and abuse of organisation resources.

Some of these are evident as identified within KRA. Continued social

injustice within KRA as identified above would continue to cause

multiple problems to the organisation. These include:

Reduced enthusiasm, morale and productivity

This causes employees’ performance to be reduced.

Indifference at the work place

This causes slower turn-around times on basic activities.



Corruption

This caused revenue loss to the authority.

Absenteeism

This causes reduced organisational performance causing failure

to meet objectives

Abuse of organisation resources

This causes an increase in operational costs for the authority

6 Conclusion

To combat the challenges identified above, the authority need to re-look

and further investigate social justice at its work place. Though it may not

manifest externally except in given instances, the impact of the concerns

around this are grave and will continue to affect the authority’s

performance in the long run.

The authority needs to focus in ensuring that the following corporate

governance and ethical aspects are fully incorporate in the organisation

as identified above:

Natural Moral Law

Virtues

Subsidiarity

Stakeholder theory



Once these are inculcated in the organisation, social justice concerns will

be greatly reduced if not completed done away with.



7 References

Barry, B. (2005). Why social justice matters. Polity.

Business Daily: - Opinion & Analysis |Address salary inequalities. (n.d.). . Retrieved April 5, 2011, from http://www.businessdailyafrica.com/Opinion+++Analysis/Address+salary+inequalities/-/539548/1138696/-/bttmtb/-/index.html

Cropanzano, R., Byrne, Z. S., Bobocel, D. R., & Rupp, D. E. (2001). Moral Virtues, Fairness Heuristics, Social Entities, and Other Denizens of Organizational Justice. Journal of Vocational Behavior, 58(2), 164-209. doi:10.1006/jvbe.2001.1791

Cropanzano, R., Goldman, B., & Folger, Robert. (2003). Deontic justice: the role of moral principles in workplace fairness. Journal of Organizational Behavior, 24(8), 1019-1024. doi:10.1002/job.228

Kenya in Brief. (n.d.). . Retrieved April 6, 2011, from http://www.statehousekenya.go.ke/kenya.html

Mavericks Teacher Resources : Politics : Glossary. (n.d.). . Retrieved April 6, 2011, from http://www.glenbow.org/mavericks/teacher/english/thm_poli/glossary.html

Meindl, J., & Steensma, H. (1994). Justice in the workplace. Social Justice Research, 7(3), 189-195. doi:10.1007/BF02334830

Radical Alliance’ Priests Strike With Pickets. (1937). [[Pittsburgh Press]], p. 42.

Salaries & Kenya Pay. Government Accused of Discrimination | Staff-Kenya Jobs. (n.d.). . Retrieved April 5, 2011, from http://www.staff-kenya.com/wordpress/2009/10/11/salaries-kenya-pay-government-accused-of-discrimination/

Skarlicki, D. P., & Folger, R. (1997). Retaliation in the workplace: The roles of distributive, procedural, and interactional justice. Journal of applied Psychology, 82, 434–443.

Workplace Equality: Contemporary Social Justice in the Workplace, Page 2 of 2 - Associated Content from Yahoo! - associatedcontent.com. (n.d.). . Retrieved April 5, 2011, from http://www.associatedcontent.com/article/2664083/workplace_equality_contemporary_social_pg2.html?cat=31



8 Appendices



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Similarity Index18%Similarity by SourceInternet Sources:

9%Publications:

5%Student Papers:

13%sources:

14% match (student papers from 11/04/10)Submitted to Waikato University on 2010-11-04

22% match (Internet from 12/29/10)http://www.kra.go.ke/kra/krahistory.html

32% match (student papers from 08/30/10)Submitted to Northcentral on 2010-08-30

41% match (student papers from 02/24/10)Submitted to University of Maryland, University College on 2010-02-24

51% match (Internet from 10/18/10)http://pastel.paristech.org/5090/

61% match (student papers from 02/02/11)Submitted to Laureate Higher Education Group on 2011-02-02

71% match (student papers from 04/13/09)Submitted to CTI Education Group on 2009-04-13

81% match (student papers from 03/28/10)


Social Justice in Kenyan Parastatals

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