Staff Expose Alleged Human Rights Abuses and Tax Evasion At Kentons Pharmaceuticals and B N Kotecha in Kisumu, Demand KRA Probe

Employees at Kentons Pharmaceuticals in Kisumu have raised serious allegations of workplace abuse and tax evasion, demanding that Kenya Revenue Authority Director General Humphrey Wattanga dispatch an independent investigation team to probe both the pharmaceutical company and B N Kotecha and Sons operations.

The pharmaceutical wholesale and distribution company, owned by the extended Ashok Shah family and headed by founding director and CEO Ashok Shah, alongside directors Vishaal Ashok Shah and Neel Ashok Shah, stands accused of fostering a toxic workplace environment characterized by intimidation, unfair dismissals, and systematic labour rights violations.

According to multiple staff sources who spoke to this publication, the company has created a culture of fear where employees are routinely forced to sign contracts without proper explanation and subjected to unlawful dismissals.

Workers claim they are coerced into silence through threats of termination, with management allegedly telling concerned employees to resign under the pretext that employment is a favor.

The allegations extend beyond workplace harassment to include racial discrimination, with sources claiming that Asian staff receive preferential treatment including exclusive access to bonuses, while local employees are systematically sidelined and overworked.

Staff report being expected to work from 7:30 am until 6:30 pm despite official operating hours being 8:00 am to 6:00 pm, with no overtime compensation offered.

Kentons.

In a controversial development, permanent staff have allegedly been coerced into signing new contractual terms without adequate review time, effectively converting their employment from permanent to contractual status without prior consultation.

The company has also reportedly reallocated employees’ statutory NSSF contributions to private APA Insurance coverage without worker consultation, raising questions about compliance with existing labour regulations.

The financial irregularities allegedly extend to tax evasion schemes involving the finance department, where sources claim friendly suppliers receive multimillion-shilling drug supplies without proper electronic invoicing.

Staff allege that company management maintains improper relationships with KRA Kisumu branch officials to cover up these practices.

The toxic environment has reportedly taken a significant toll on workers, with at least five employees resigning in the past two months citing intense frustration with discriminatory management practices and psychological strain.

Former employees claim that efforts to seek redress through labour offices often prove futile due to suspected corruption, with bribes allegedly used to dismiss cases.

The B N Kotecha and Sons connection to these allegations gains additional context from recent Supreme Court proceedings, where the Kisumu-based sugar dealing firm, led by Hemar Kishor Kotecha, failed in its bid to overturn a Sh260 million judgment.

The Supreme Court declined to hear the appeal in the company’s dispute with Amalo & Company Ltd, with Chief Justice Martha Koome and fellow justices ruling that the case did not involve constitutional interpretation.

The court noted that B N Kotecha and Sons had failed to comply with a conditional order requiring a Sh20 million security deposit, with the company claiming financial difficulties due to loans to third parties and Covid-19 pandemic impacts.

The firm’s inability to meet court-ordered financial obligations raises additional questions about its business practices and financial transparency.

Staff sources are now calling for comprehensive investigations into both companies’ operations, particularly focusing on tax compliance, labour law adherence, and financial transparency.

The allegations paint a disturbing picture of corporate misconduct that, if substantiated, would represent serious violations of Kenya’s labour laws and tax regulations.

The Kenya Revenue Authority has not yet responded to requests for comment on the allegations, while attempts to reach Kentons Pharmaceuticals and B N Kotecha and Sons management for their response were unsuccessful at the time of publication.

These developments underscore broader concerns about corporate governance and worker rights protection in Kenya’s business sector, particularly regarding the treatment of local employees by international business entities operating within the country.​​​​​​​​​​​​​​​​