Alice M. Yobera v The Board Of Governors,Arya Vedic Primary And Secondary School & another [2014] KEELRC 940 (KLR)
The bottom line
#A Kenyan court ruled that a teacher kept in limbo between a closed gratuity scheme and a pension she never joined was entitled to her gratuity payout.
What this practically means
#Executive summary
#Key legal issues
#Whether the Claimant was entitled to gratuity for the period September 2004 to August 2009 after the gratuity scheme was phased out and replaced with a pension scheme in which she was not enrolled
The Claimant remained in the gratuity scheme because the pension scheme never replaced the gratuity scheme in her case; excluding her would amount to unlawful discrimination
The letter introducing the pension scheme did not state that the Claimant would be excluded or that the scheme had an age limit of 65 years. Her signature only agreed to a replacement of the gratuity scheme with a pension scheme. Since the replacement never happened in her case, she logically remained in the gratuity scheme. Holding otherwise would discriminate against her, as other staff had a retirement benefit while she would have none.
Whether the claim was brought against the wrong party, the scheme managers rather than the employer
The correct defendant is the employer, who sponsored the scheme; the Claimant had no relationship with the scheme managers as she was never a member of the pension scheme
The court held that the employer sponsored the scheme and the managers only manage it on the sponsor's behalf; the sponsor determines the terms. The Claimant's claim is founded on her employment relationship with the Respondents, not on membership of the pension scheme, so she cannot maintain a claim against the managers.
Whether the Claimant's claim for gratuity was statute barred
The limitation objection was not upheld; the court awarded gratuity for the full period September 2004 to August 2009
The Respondents argued the claim ought to have been brought by September 2010, six years after phasing out of the scheme. The court did not accept this and awarded gratuity accrued up to the Claimant's retirement in August 2009, treating her entitlement as continuing under the unreplaced gratuity scheme.
Legal principles established
#- Where an employer replaces a gratuity scheme with a pension scheme but an employee is not enrolled in the new scheme, the employee remains in the gratuity scheme; otherwise the employee would be discriminated against in respect of employment benefits
- The employer, as sponsor of a retirement benefits scheme, determines the terms of the scheme, and a claim for employment benefits lies against the employer and not the scheme managers
Court orders
#- 1.Award of Shs 434,204.64 to the Claimant being 12% of her actual monthly salary for the period September 2004 to August 2009
- 2.Claimant awarded costs of the claim
- 3.Interest on both the awarded amount and costs from the date of judgment
- Jurisdiction invoked
- Original jurisdiction of the Industrial Court over employment and labour relations disputes
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Alice M. Yobera v The Board Of Governors,Arya Vedic Primary And Secondary School & another [2014] KEELRC 940 (KLR)", Case Analysis (2014). Cause No. 2069 of 2012. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2014/940/eng@2014-03-31
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.