It will cost Williamson Tea half a billion to effect a contested collective bargaining agreement that would have seen the lowest tea plucker take home Sh13,052, up from Sh10,052.
According to an application filed at the Appeals Court to stop the CBA calling for a 30 per cent increase of tea pluckers pay, the multinational said it will lose Sh578 million to increase workers pay.
The multinationals argued that the pay increase will blow their wage bill by 60 per cent.
"This is a colossal sum and the applicant may not be able to recover the same if paid out to the respondents union employees," Appeal Court judges who gave the multinationals a temporary reprieve said in an October 7 ruling.
Kenya Tea Growers Association (KTGA) members including Williamson Tea are unwilling to comply with an industrial court ruling mid this year effecting an increase of tea growers' salary by 30 per cent.
"If the applicant (KTGA) complies with the orders granted, it would lead to the collapse of the tea industry in Kenya as factories would be unable to pay and shut down," the temporary stay orders granted against Kenya Plantation and Agricultural Workers Union (KPAWU) read.
The multinationals, including Williamson Tea Limited, Kapchorua Tea Company Limited and James Finlay Kenya Limited, represented by lobby KTGA, argue that the CBA will run them out of business despite recording impressive jumps in profits.
A report by Maersk, a business conglomerate that includes shipping services indicates that the amount quoted by the multinational, is only one per cent of the total Sh53.2billion tea exports made by the industry between May 2015 and May 2016.
"Tea fetched Sh53.2 billion in the period, up from Sh41.2 billion in a similar period in 2015 – a growth of Sh12 billion. Tea earnings growth was further aided by the weakening of the shilling against the US dollar," said Maersk.
The report further showed that tea exports grew by 43 per cent in the first nine months of 2016.
"Kenya is the world's leading exporter of black tea, a crop that offers a livelihood to thousands of small-scale growers," added the report.
Earlier this year, thousands if tea growers went on strike due to failure of the tea producers to implement a pay increase awarded to the farmers.
A top official of James Finlay Kenya limited stated that the firm would suffer major losses if the strike was not called off.
KTGA had also gone into negotiations with the union proposing a 15 per cent raise broken down to 7per cent for 2014, and 8 percent for 2015.
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