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ELRCPartially AllowedNot stated in judgment· [2013] KEELRC 889 (KLR)

Festus Kirema Muthuku v Mellech Engineering & Construction Ltd [2013] KEELRC 889 (KLR)

Industrial Court of Kenya (Employment and Labour Relations Court)
13 November 2013
LNLINNET NDOLO
684 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Employment Court can force an employer to deposit the claimed amount in court if there's a real risk it won't pay an award.

What this practically means

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Executive summary

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This was a ruling on an interlocutory Notice of Motion filed with a Memorandum of Claim on 24th June 2013 by an employee alleging unlawful (redundancy) termination by his employer. Two interim prayers were sought: immediate release of Kshs. 275,918 admitted by the Respondent as owing, and an order that the Respondent deposit Kshs. 396,092 in court to secure the claimed terminal benefits. The first prayer was satisfied after an order of the court on 28th June 2013, the Respondent paying the Kshs. 275,918 on 19th July 2013, leaving only the deposit prayer for determination. Counsel for the Claimant argued that the Respondent was relocating operations to South Sudan, had difficulties paying undisputed dues, and that the redundancy declaration was unlawful, giving a prima facie case with a real risk that any award could not be enforced. Counsel for the Respondent attributed the payment delay to the Claimant's refusal to sign a final dues statement and denied moving out of Kenya, though he admitted losing Kenyan contracts. Judge Linnet Ndolo found the claim arguable, noted that the Respondent only paid admitted sums upon a court order, and observed that neither the extent of divestiture nor the Respondent's financial health had been disclosed. The Claimant's fears were held well founded. The court ordered the Respondent to deposit Kshs. 396,092 in court within thirty days, with costs of the application in the cause.

Key legal issues

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01

Whether security for the claim amount should be ordered where the employer is allegedly relocating out of the jurisdiction

Holding

The court found the Claimant's fears well founded, noting an arguable case and the Respondent's reluctance to pay undisputed dues and undisclosed divestiture plans, and ordered the deposit.

Reasoning

The court was satisfied that the claim was arguable. It also noted that it took a court order for the Respondent to pay admitted dues, and that the Respondent had lost Kenyan contracts and was moving into South Sudan without disclosing the extent of divestiture or its financial health. Those circumstances justified securing the claim sum by deposit in court.

p. 2

Legal principles established

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  • An employee who advances an arguable case and shows a real fear that the employer may not be able to satisfy an award may obtain security-for-claim in the form of a deposit in court

Court orders

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  1. 1.The Respondent to deposit the sum of Kshs. 396,092 in Court within thirty (30) days from the date of the Ruling
  2. 2.Costs of the application to be in the cause
Jurisdiction invoked
Original employment and labour relations jurisdiction under the Industrial Court Act (Article 162(2) of the Constitution not expressly cited in judgment)

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Festus Kirema Muthuku v Mellech Engineering & Construction Ltd [2013] KEELRC 889 (KLR)", Case Analysis (2013). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2013/889/eng@2013-11-13

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.