Sugar workers in Kenya have threatened to down their tools over KSh2.7 billion in outstanding salary arrears, raising concerns about possible disruption of sugar production across the country. The workers, through the Kenya Union of Sugar Plantation and Allied Workers (KUSPAW), say they have been waiting for their unpaid salaries and are now prepared to take industrial action if the arrears are not addressed. According to a report published on September 30, 2026, the union said workers could begin the strike on Thursday, potentially affecting operations in the sugar industry. 

Workers demand payment of KSh2.7 billion

The dispute centres on a reported KSh2.7 billion owed to sugar workers in salary arrears. For employees who depend on their monthly wages to meet household expenses, prolonged delays in receiving salaries can create serious financial difficulties.

The union has argued that workers should not continue providing labour while large amounts of their earned wages remain unpaid. The threat of a strike therefore represents an escalation of the dispute between workers, millers and the authorities responsible for overseeing the struggling sugar sector.

KUSPAW Secretary General Francis Wangara has called for action over the unpaid salaries and indicated that workers could stop working unless the outstanding payments are addressed. The union has also called on millers to consider shutting down their operations to protect themselves from potential losses that could arise if workers proceed with the strike. �

KenyaMOJA

The proposed industrial action comes at an important time for Kenya's sugar industry, which is already undergoing reforms aimed at improving the performance of public sugar factories and addressing longstanding financial problems.

Strike could disrupt sugar production

If the workers proceed with the planned strike, sugar production could be significantly affected because the industry depends on a large workforce to keep plantations, factories and other operations running.

A shutdown could affect activities ranging from cane harvesting and transportation to milling and processing. Sugar factories require coordinated operations, and prolonged disruption at one stage can affect the entire production chain.

For example, if workers involved in milling stop working, harvested sugarcane could face delays before it is processed. This could have consequences for farmers supplying cane to factories because sugarcane must be delivered and processed within appropriate periods to maintain production efficiency.

The impact could therefore extend beyond employees to sugarcane farmers, transporters, traders and communities whose economies depend heavily on sugar factories.

Government previously promised to address sugar-sector arrears

The current dispute is also connected to wider financial problems in Kenya's sugar industry.

According to the report on the workers' strike threat, the government had previously pledged to pay up to KSh5.6 billion in arrears owed to stakeholders in the sugar sector following the leasing of public sugar factories in 2025. 

The broader figure is important because sugar factories have accumulated financial obligations involving different groups within the industry. These can include employees, farmers, suppliers and other stakeholders.

The workers' demand for KSh2.7 billion therefore comes against a background of efforts to clear debts and restore public sugar companies to more sustainable operations.

Sugar reforms receive government funding

The sugar industry has remained a major policy issue for the Kenyan government because of its importance to agriculture, employment and food production.

The 2026/27 national budget included funding for sugar reforms. Kenya News Agency reported that the government allocated KSh2.7 billion to sugar reforms in the financial year. 

The allocation demonstrates that the sugar sector remains a significant area of government expenditure and reform.

However, the existence of budgetary support does not automatically mean that every outstanding obligation has been settled. The current workers' dispute shows that questions remain over how available funds are distributed and how quickly outstanding obligations are paid.

Public sugar factories and the leasing programme

Kenya has been attempting to change the management and financial structure of some public sugar factories through leasing arrangements.

The objective has included attracting private-sector management and investment while reducing the financial burden associated with poorly performing public factories.

The leasing of public factories was also expected to help improve production, strengthen management and address accumulated debts.

However, workers' concerns over unpaid salaries show that financial restructuring can have consequences for employees if outstanding obligations are not resolved promptly.

Workers remain an important part of any attempt to revive the sugar industry. A factory cannot operate effectively without employees in the fields, factories, transport operations, maintenance departments, administration and other areas.

Why salary arrears are a serious issue

Salary arrears are different from ordinary wage negotiations because they involve money workers say they have already earned.

When employees receive their salaries late, they may struggle to pay rent, school fees, food expenses, loans, medical bills and other household costs. The longer the delay continues, the greater the financial pressure on affected families.

For sugar workers living in communities surrounding factories and plantations, delayed salaries can also affect local businesses. Workers who have not received their wages have less money to spend in shops, markets, transport services and other businesses.

This means a salary dispute at a sugar factory can have an economic effect beyond the factory itself.

Possible consequences for farmers

A prolonged strike could also create difficulties for sugarcane farmers.

Farmers depend on sugar factories to receive and process their cane. If factory operations are disrupted, cane deliveries could be delayed.

Sugarcane production already requires coordination between farmers, harvesting teams, transporters and millers. Any interruption can create uncertainty for farmers who have invested time and money in growing their crops.

The situation therefore presents a potential challenge for the entire sugar value chain if the dispute is not resolved quickly.

Union calls for action

The union's position indicates that workers have reached a point where they believe industrial action is necessary to push for payment.

The planned action is also intended to draw attention to the financial difficulties facing employees within the sector. By threatening to stop production, workers are using the economic importance of sugar manufacturing to press for negotiations over their unpaid salaries.

The union has also urged millers to initiate shutdowns, according to the report, in an effort to limit potential losses that could arise from the workers' action.

Government and millers face pressure

The threat places pressure on both the government and sugar millers to find a solution.

For the government, the dispute comes at a time when it is pursuing reforms designed to revive the sugar industry. Failure to address workers' salary concerns could create another obstacle to those reforms.

For millers, a strike could mean lost production and revenue. Sugar factories have significant operating costs, and a prolonged shutdown could affect their ability to process cane and supply the market.

Negotiations could therefore become important in preventing the dispute from escalating.

A test for Kenya's sugar-sector reforms

The latest dispute highlights one of the major challenges facing Kenya's sugar industry: reviving factories while also addressing accumulated financial obligations.

Reforms cannot focus only on production figures and factory management. Workers, farmers and other stakeholders also need predictable payment arrangements.

The KSh2.7 billion salary-arrears dispute has consequently become an important issue for the future of the sector. How the government, unions and millers respond could affect industrial relations as well as the continuity of sugar production.

For now, sugar workers have threatened to begin their strike, putting the industry on alert. The immediate priority for the parties involved will be negotiations over the outstanding salaries and finding a way to prevent a shutdown of sugar production.

The dispute also demonstrates the wider financial pressures that have affected Kenya's sugar industry for years. While government funding and reforms are intended to improve the sector, workers' demands show that resolving accumulated obligations remains an important part of the recovery process.