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ELRCDismissedCause No. 116 of 2013 (with related Causes No. 241 and 587 of 2013)· [2014] KEELRC 881 (KLR)

Rift Valley Railways Workers Union v Rift Valley Railways (Kenya) Limited & another [2014] KEELRC 881 (KLR)

Industrial Court of Kenya

24 March 2014

LNLinnet Ndolo

2,050 words in judgment

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The bottom line

The Industrial Court refused to pause orders requiring an employer to remit union dues, ruling the employers' appeal grounds were factual disputes not worth staying proceedings.

What this practically means

Executive summary

This ruling of the Industrial Court at Nairobi (Linnet Ndolo, J) determined two applications by the 1st and 2nd Respondents seeking stay of execution of the Court's ruling of 24th January 2014 and stay of the further proceedings pending intended appeals to the Court of Appeal under Section 17 of the Industrial Court Act, 2011. The earlier ruling had directed the 1st Respondent to deduct and remit union dues to the Claimant for employees who had resigned from the 2nd Respondent, and held that no agency fees were payable to the 2nd Respondent in respect of those employees. The Court directed that the parties file additional evidence on the issues of agency fees deducted contrary to an order of 11th June 2013 and of recognition of the Claimant for collective bargaining, both of which remained pending. The Respondents argued their appeals would be rendered nugatory as funds would be irrecoverable, and the 1st Respondent questioned the authenticity of resignation letters dated January 2013 and the accuracy of the Claimant's membership list. The Court applied the Giella v Cassman Brown conditions and the Reliance Bank stay principles, holding that the objections were matters of fact; that at least 30 unconflicted employees justified continued remittance of dues; and that under Section 50(3) of the Labour Relations Act the balance of convenience favoured the Claimant and its members. The Court also held that allegations of continued deduction of agency fees in defiance of the 11th June 2013 order, if proved, would amount to contempt of court requiring urgent attention, and a stay would subvert the pending recognition inquiry. Both applications were dismissed with costs to the Claimant.

Key legal issues

Whether the intended appeals were arguable and would be rendered nugatory without stay

Holding

The Respondents did not demonstrate entitlement to stay; the objections to the orders were factual matters already the subject of pending proceedings

Reasoning

The Court applied the Giella principles and the stay principles in Reliance Bank. It found the objections to the resignation letters' dates and shifts in membership numbers were matters of fact subject to reconciliation, and that at least 30 unconflicted employees justified continued remittance of dues, so no irreparable prejudice was shown.

p. 3

Whether the balance of convenience favoured staying the agency fees order

Holding

It did not; under Section 50(3) of the Labour Relations Act employees would have no recourse against the employer if the appeal succeeded

Reasoning

Section 50(3) provides that deductions made by an employer on account of union dues and agency fees are not recoverable from the employer by the employee. If the Court of Appeal found the 2nd Respondent not entitled to agency fees, the affected employees would have no recourse against their employer; hence the balance of convenience tilts in favour of the Claimant and its members.

p. 4

Whether proceedings should be stayed where contempt of court is alleged

Holding

No; allegations of contempt must be addressed with utmost seriousness and urgency and the Respondents must address this Court on the issue even as they pursue appeal

Reasoning

The Court noted the allegation that agency fees continued to be deducted after the order of 11th June 2013, which if proved would amount to contempt. Citing Econet Wireless, it held such matters cannot be ignored or deferred to a later stage after appeal.

p. 4

Legal principles established

Applications for stay pending appeal are governed by the principles that the appeal must be arguable and that the appeal would be rendered nugatory absent a stay
Once a matter touching on contempt of court is raised, it must be addressed with utmost seriousness and urgency

Court orders

1.Dismissal of the 1st and 2nd Respondents' applications for stay of the orders issued on 24th January 2014 and of the succeeding proceedings
2.Costs of the applications awarded to the Claimant

Authorities

Legislation

Industrial Court ActSection 17
Labour Relations ActSections 48(2), 49(1), 50(3)
Constitution of Kenya, 2010Article 41(2)

Cases cited (3)

Giella Vs Cassman Brown & Company Limited
[1973] EA 358
Reliance Bank Limited Vs Noriake Investments Limited
[2002] 1EA 227 (CAK) Case No. 937 of 2002
Econet Wirelss Ltd Vs Minister for Information & Communication of Kenya & Another
[2005] eKLR

Jurisdiction invoked: Industrial Court Act, 2011 (trade dispute adjudication); Section 17 thereof for appeals to the Court of Appeal

Key timeline

Practical implications

Frequently asked questions

Cite this brief

Caselaw, "Rift Valley Railways Workers Union v Rift Valley Railways (Kenya) Limited & another [2014] KEELRC 881 (KLR)", Case Analysis (2014). Cause No. 116 of 2013 (with related Causes No. 241 and 587 of 2013). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2014/881/eng@2014-03-24

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