Economy

Sacked NSSF chief sues Kazungu for compensation after ‘irregular dismissal’

nssf

Labour secretary Kazungu Kambi. Sacked NSSF Tom Odongo chief has sued the Secretary for compensation after ‘irregular dismissal’. Photo/File

Tom Odongo, who was recently axed as head of the National Social Security Fund (NSSF), has gone to court seeking reinstatement.

He claims that Labour secretary Kazungu Kambi has no powers to fire him. He also says Mr Kambi’s decision was arbitrary and did not involve the board of trustees to whom he was answerable as chief executive.

“In all fairness, I am entitled to reasons of the termination. Without reasons the termination is unfair. I know of my own knowledge that the Board of Trustees did not meet to consider the question of termination of my employment,” said Mr Odongo in a sworn affidavit filed in the Industrial Court.

His three-year contract was terminated on Monday by Mr Kazungu barely eight months after he was appointed following competitive vetting.

(Read: NSSF boss Tom Odongo sacked)

In the sacking letter sent to media outlets, Mr Kazungu did not cite the reasons for the firing but referred to clause 20(i) of the executive’s contract which allows any of the parties to sever the agreement.

Mr Kazungu appointed Hope Mwashumbe in an acting capacity.

Mr Odongo said he got information of his firing from the media and was not given a chance to make representations to the board.

The embattled chief executive is seeking comfort from recent rulings by the Industrial Court, which have restored top managers bundled out of their positions without following due process.

Some of the executives who have gone to court and were reinstated include Rose Kikwai of Kenya Investment Authority, Ibrahim Haji Issak of Kenya Meat Commission and Tarda CEO Abdul Agonga.

The current drama is reminiscent of that of 2008 when then Labour minister John Munyes fired Rachel Lumbasyo who dug in with the support of the Board of Trustees.

Mr Munyes finally had his way but the exit of Ms Lumbasyo saw the fund go through a period of volatility as Fred Rabongo took charge for barely two weeks, only to be replaced by James Akeyo who was shortly replaced by Albert Odero before Alex Kazongo was appointed on permanent basis.

The job is controversial because of the history of the pension fund as a milk cow for political interests and well-connected merchants, thus always attracting intense scrutiny and vicious political infighting.

The fund has had seven chief executives in the last five years with some occupying the seat for less than a week, a fact that has eroded public confidence in the institution.

Mr Odongo’s principal task was managing the reforms aimed at establishing professionalism at the NSSF, eliminating corruption and increasing returns to membership.

He had led firm through a rebranding phase as it sought to shed negative perceptions and has been lobbying members of parliament to support the NSSF bill, when it is tabled in parliament.

The bill seeks to convert the social fund to a pension scheme while also increasing workers contribution to their retirement years.

Currently the scheme collects about Sh600 million on a monthly basis, 45 per cent of which is used in operational expenses. It is now proposing to increase the member’s contribution from the current monthly Sh400 to 12 per cent of employees’ salary.

He had also spearheaded restructuring at the fund which had seen it give early retirement packages to 315 employees and was considering more exits.

Mr Odongo’s firing came at a time the Sh126 billion fund was initiating huge real-estate projects including extension of Hazina Trade Centre at a cost of Sh6.7 billion.

Other projects include Sh80 billion city project in Mavoko, construction of a 62-storey building at Sh20 billion and 100 apartments at Sh1.6 billion along State House road.