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ELRCDismissedCause referenced as involving award of 24th September 2013; Notice of Motion filed 25th October 2013 (under Certificate of Urgency)· [2014] KEELRC 589 (KLR)

Kenya Union Of Journalists & Allied Workers v Nation Media Group Limited [2014] KEELRC 589 (KLR)

Industrial Court (Employment and Labour Relations Court)
13 February 2014
2,221 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~9 min to read original · ~4 min brief

The bottom line

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A Kenyan court refused to pause an employment award, ruling that voluntary 'ex-gratia' payments cannot replace terminal benefits legally owed to employees.

What this practically means

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Executive summary

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This is a ruling on the Respondent employer's Notice of Motion seeking a stay of execution of the decree arising from an award delivered by Lady Justice Maureen Onyango on 24th September 2013, in which the 1st Grievant was awarded Kshs.3,622,112.10 and the 2nd Grievant Kshs.2,009,630.00. The employer intended to appeal, contending that the court erred by including ex-gratia payments in the Grievants' entitlements and by awarding gratuity contrary to the Employment Act and the Collective Bargaining Agreement. An ex-parte stay was granted on 25th October 2013 pending inter-parties hearing. The court reconsidered its award logic: ex-gratia payments are made outside an employer's legal obligations and cannot substitute for statutory or CBA terminal benefits; and the gratuity awarded flowed from clause 20 of the CBA, recognised by section 35(6)(b) of the Employment Act, which displaces statutory service pay where a CBA gratuity scheme exists. Section 26 required application of the more favourable CBA terms. Applying the stay principles - prima facie case with probability of success, irreparable loss, and balance of probabilities - the court found the intended appeal was founded on misapprehension of the law and disclosed no prima facie case. Citing MS Port Reitz Maternity v James Karanga Kabia, it held the Grievants were entitled to the fruits of their award absent just cause. The stay application was dismissed with costs, with leave granted to the Respondent to file its appeal and seek stay in the Court of Appeal.

Key legal issues

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01

Whether inclusion of ex-gratia payments in the calculation of terminal benefits was erroneous

Holding

The court correctly excluded ex-gratia payments from the award of legal entitlements; ex-gratia does not replace legally due terminal benefits, and the outstanding legal entitlements were properly awarded

Reasoning

The court defined ex-gratia via the Oxford and Black's Law Dictionaries as payment made from moral obligation, not legal requirement. Since the Respondent had already paid ex-gratia but had failed to pay the statutory and CBA entitlements, the ex-gratia payments could not offset the legally due amounts. There was no prayer by the claimants to treat ex-gratia as terminal benefits, and it was too late for the Respondent to seek conversion.

p. 3
02

Whether the award of gratuity under the CBA was contrary to the Employment Act

Holding

The gratuity awarded was the gratuity scheme established under clause 20 of the CBA, which section 35(6)(b) of the Employment Act recognises and which displaces statutory service pay

Reasoning

Clause 20 of the CBA provides for 30 days pay per completed year by way of gratuity, payable except on dismissal for misconduct. The Grievants were terminated by redundancy, not summary dismissal, so they were entitled to gratuity. Section 26 of the Employment Act mandates application of the more favourable CBA terms. Under section 35(6)(b), membership of a CBA gratuity scheme excludes statutory service pay, hence no contradiction in the award.

p. 4
03

Whether the conditions for stay of execution pending appeal were satisfied

Holding

Stay refused because the intended appeal lacked a prima facie case with probability of success and no just cause existed to deprive the Grievants of the fruits of the award

Reasoning

The applicant had to demonstrate a prima facie case with probability of success, irreparable loss, and on a balance of probabilities. The only grounds of appeal rested on misapprehension of sections 26, 35(5)-(6) and 40 of the Employment Act and on the nature of ex-gratia payments. Since no arguable appeal was found, the remaining grounds did not need consideration. Citing MS Port Reitz Maternity, the right of appeal must be balanced against the decree-holder's right to enjoy the fruits of judgment.

p. 5

Legal principles established

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  • Ex-gratia payments are made outside the employer's legal obligations and cannot be substituted for legally due terminal benefits
  • Where terms in a collective agreement are more favourable than the statutory minimum, the more favourable terms apply per section 26 of the Employment Act
  • An employee entitled to gratuity under a CBA scheme is not additionally entitled to service pay under section 35(5) of the Employment Act
  • The right of appeal must be balanced against the successful party's right to enjoy the fruits of judgment; stay requires just cause

Court orders

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  1. 1.Application for stay of execution dismissed
  2. 2.Application dismissed with costs to the Claimants
  3. 3.Respondent granted leave to file its appeal and to seek stay in the Court of Appeal
Jurisdiction invoked
Inherent jurisdiction of the Industrial Court to grant stay of execution pending appeal to the Court of Appeal

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, "Kenya Union Of Journalists & Allied Workers v Nation Media Group Limited [2014] KEELRC 589 (KLR)", Case Analysis (2014). Cause referenced as involving award of 24th September 2013; Notice of Motion filed 25th October 2013 (under Certificate of Urgency). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2014/589/eng@2014-02-13

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