• Overtime rates of pay were supervised by clerks without managerial responsibility, were not backed by any policy, and were processed manually.
• KPA breached the law on numerous occasions and more than 40 per cent of management are from one ethnic community, the Auditor General said.
Image: JOHN CHESOLI
Taxpayers could be losing billions of shillings in the payroll shambles at the Kenya Ports Authority.
An audit of the authority’s books for the year ending June 30, 2020, reveals workers were irregularly paid more than Sh3.5 billion, for no work done.
Auditor General Nancy Gathungu's report reveals overtime rates of pay were supervised by clerks without managerial responsibility, were not backed by any policy and were processed manually, making leaks likely.
KPA paid Sh312 million in basic salary for hours not worked, calling into question the validity of the Sh19.5 billion spent on wages in the year under review.
Kenya Ports Authority pays salaries based on the hours worked as clocked in a time management system.
Some absentee workers earned Sh36.8 million, contrary to provisions in the KPA Human Resources Manual, 2017, which provides for stopping salaries to employees absent for 10 days.
“Management approved payment for hours not worked for staff who came late and those who left work before time,” the Auditor General said.
At least 262 employees were appointed to positions that are not in the approved staff establishment
- Auditor General
Work allocation schedules and payroll records revealed various employees were irregularly paid Sh1.7 billion for working extra hours after their shifts.
Some 1,337 employees who worked for eight hours a day were paid overtime allowance amounting to Sh214 million. contrary to the human resource policy.
“Consequently, the propriety and validity of the establishment expenses of Sh1.9 billion could not be confirmed,” Gathungu said.
The authority further paid Sh879 million for overtime allowances in excess of the caps set for operations and administrative employees.
KPA also paid overtime allowances of Sh54 million, which were wrongly calculated based on the the CBA agreement of 2018-19.
The authority irregularly paid some 3,669 employees Sh872 million in monthly berth productivity incentives, yet no new targets were realised by the workers.
Such allowances are paid only when there is performance over and above the set targets, subject to the approval of the board’s HR committee.
“However, it was observed that payments were based on all units achieved, including the normal target. The propriety, validity and lawfulness of staff allowances of Sh19.6 billion could not be confirmed,” the report reads.
The audit further revealed that 262 employees were appointed to positions not in the approved staff establishment.
A review of the human resource documents revealed two general managers, six heads of departments, four principals and 250 junior managers were holding illegal positions.
KPA thus irregularly spent Sh629 million for payment of salaries and allowances to the officers contrary to provisions of the State Corporation Act, 2012.
Gathungu said KPA breached the law providing that a state corporation may engage and employ such a number of staff, including the CEO, on such terms as approved by the authorities.
At the same time, the authority has been flagged for ethnic imbalance after it was found that more than 40 per cent of employees in management positions are from one ethnic community.
KPA as of June 2020 had 2,156 employees in management positions and 4,499 on permanent terms, bringing the total to 6,655.
Gathungu cited a violation of the National Cohesion and Integration Act, 2008, which caps the ratio at not more than one third from one community.
The authority was also cited for irregularly hiring 40 dock workers who were engaged on contract terms at the Nairobi Inland Container Depot.
Gathungu further queried Sh2 million irregularly paid to five employees in management positions whose terms of service were not approved by the KPA board.
The Auditor General further flagged Sh29.5 million paid to employees on training grades, contrary to the HR Manual.
KPA was also found to have irregularly paid Sh1.3 million to staff as monthly acting allowances beyond the six months allowed.
The audit revealed nine employees were recruited as choir members without the required papers — a minimum of D plain in the KCSE exam.
Some officers were also found to be serving past the mandatory retirement age of 60 years (65 for persons with disability).
(Edited by V.Graham)