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ELRCDismissedCause No 789 of 2013· [2014] KEELRC 1138 (KLR)

Robert Nyongesa v Sacco Societies Regulatory Authority & another [2014] KEELRC 1138 (KLR)

Industrial Court of Kenya (Employment and Labour Relations Court)
11 July 2014
MOMaureen Onyango
955 words in judgment
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The bottom line

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Kenya's Employment Court confirmed it alone handles job disputes involving SACCOs, and regulators who order dismissals must face the claim alongside the employer.

What this practically means

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Executive summary

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The Claimant was removed from office by the 2nd Respondent, Harambee Co-operative Savings and Credit Society Limited, on the directives of the 1st Respondent, the SACCO Societies Regulatory Authority, which also sought a three-year ban on the Claimant holding office in any SACCO. The Claimant filed a Memorandum of Claim dated 23rd May 2013. The 1st Respondent raised a Notice of Preliminary Objection arguing there was no employer/employee relationship between it and the Claimant, that it was not privy to the employment contract, that any remedy lay with the Minister under Regulation 72(7) of the Sacco Societies (Deposit-taking Sacco Business) Regulations, 2010, that disputes should go to the Co-operative Tribunal under Section 67(3) of the Sacco Societies Act, that the claim was an abuse of process, and that the court lacked jurisdiction. Counsel for the 1st Respondent urged that its name be struck out. The Claimant opposed, submitting the objection raised disputed factual issues and that Section 87(2) of the Employment Act conferred exclusive jurisdiction on the court over employment matters. The court held the Co-operative Tribunal's jurisdiction under Section 76 of the Co-operative Societies Act does not extend to employment matters; the Industrial Court has exclusive jurisdiction. It further found the 1st Respondent had directly directed the removal, so the Claimant could not prosecute the claim without it. The Preliminary Objection was dismissed with orders accordingly, read in open court on 11th July 2014. No costs order was recorded.

Key legal issues

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01

Jurisdiction of the Co-operative Tribunal over employment disputes involving the SACCO regulatory authority

Holding

The Co-operative Tribunal has no jurisdiction over employment matters; the Industrial Court has exclusive jurisdiction over employment and labour relations disputes.

Reasoning

The court examined section 76 of the Co-operative Societies Act defining disputes referable to the Tribunal - disputes concerning the business of a co-operative society among members, between members and the society, or between societies. The Claimant's complaint concerned removal from office on the directives of the regulator, an employment matter. The court held the Constitution and the Industrial Court Act confer exclusive jurisdiction on the Industrial Court over employment matters, outside the Tribunal's limited mandate.

p. 2
02

Necessity of the 1st Respondent as a party to the claim

Holding

Since the 2nd Respondent removed the Claimant on the directives of the 1st Respondent, the Claimant cannot prosecute the claim without the 1st Respondent.

Reasoning

The court noted it was a fact that the 1st Respondent wrote directly to the Claimant and the 2nd Respondent demanding suspension and removal of the Claimant from office, and even a three-year ban from office in any SACCO. The 2nd Respondent pleaded it acted on the 1st Respondent's directions and not of its own volition. Therefore the claim against the 1st Respondent was properly before the court and the objection failed.

p. 3

Legal principles established

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  • The Co-operative Tribunal's jurisdiction under section 76 of the Co-operative Societies Act does not extend to employment matters; the Industrial Court has exclusive jurisdiction over employment and labour disputes.

Court orders

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  1. 1.The Preliminary Objection by the 1st Respondent is dismissed as having no merit

Authorities

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Legislation

  • Constitution of Kenya, 2010Article 162(2)(a)
  • SACCO Societies ActSection 5; Section 67(3)
  • Sacco Societies (Deposit-taking Sacco Business) Regulations, 2010Regulation 72(7)
  • Co-operative Societies Act (Cap 490)Section 76
  • Employment ActSection 87(2)
  • Industrial Court ActNot specified
Jurisdiction invoked
Article 162(2)(a) of the Constitution of Kenya, 2010; Section 87(2) of the Employment Act

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, "Robert Nyongesa v Sacco Societies Regulatory Authority & another [2014] KEELRC 1138 (KLR)", Case Analysis (2014). Cause No 789 of 2013. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2014/1138/eng@2014-07-11

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