Kenya Union of Commercial Food and Allied Workers v Kangiri Farmers Co-Operative Society Limited [2015] KEELRC 675 (KLR)
The bottom line
#Kenya's Employment Court set the terms of a coffee society's first CBA, awarding workers a 24% pay rise over two years and several allowances.
What this practically means
#Executive summary
#Key legal issues
#House allowance under the CBA
The claimant's proposal of 15% of basic monthly salary was awarded, aligned with minimum wage orders
Section 31 of the Employment Act, 2007 requires the employer to provide reasonable housing or pay reasonable rent. The respondent did not claim to provide housing. The court was guided by minimum wage orders fixing house allowance at not less than 15% of basic pay, and found the claimant's proposal reasonable.
Medical allowance
Respondent's proposal of Kshs.500.00 per month was awarded
The employer's statutory duty under section 34(1) of the Employment Act is to provide sufficient and proper medicines, which is met at minimum by enrolling employees on the NHIF statutory scheme and complying with the Employment (Medical Treatment Rules), L.N. 157/1977. Given those statutory obligations, the lower medical allowance was considered sufficient.
General wage increase / minimum wages
A pay rise of 24% over two years was awarded, being 12% effective 1.10.2014 and 12% effective 1.10.2015
The court considered the CPI of 17.45% for July 2012 to January 2015, the respondent's unhealthy financial position and losses from declining coffee production, the parties' first CBA, the need for motivated workers and productivity, and the belated negotiations. It balanced cushioning the employer with giving workers reasonable motivation.
Safari and subsistence allowance
Kshs.1,000 within district and Kshs.1,500 outside district were awarded
The court took judicial notice of prevailing costs, the employer's ability to pay and the need for reasonable care of employees assigned duties away from their normal work stations, fixing a mid-point between the parties' proposals with a lunch/supper/boarding breakdown.
Preamble of the CBA
The claimant's proposed wording was adopted as the respondent made no particular prayer opposing it
The respondent filed no specific counter-proposal to the preamble wording, so the court found the claimant entitled to its proposed text.
Annual leave travelling allowance
Kshs.1,500.00 per annum was awarded in clause 11(iv)
The claimant had dropped its earlier demand of a month's gross pay. Considering the concession and that the pay is one-off and annual, the court found the proposal reasonable to partially facilitate workers' travel expenses during annual leave.
Legal principles established
#- In making a wage award the court must consider the employer's capacity to pay, levels of productivity and the need for reasonable living wages
- Under section 31 of the Employment Act an employer must provide reasonable housing accommodation or pay reasonably for rent
Court orders
#- 1.The parties to conclude a CBA and file in court for registration by 1.09.2015 in terms of the findings and awards in the judgment, including the agreed preamble, Kshs.1,500.00 annual leave travelling allowance, 15% of basic monthly salary as house allowance, Kshs.1,000.00 within district and Kshs.1,500.00 outside district safari and subsistence allowance, Kshs.500.00 monthly medical allowance, and a pay rise of 24% over two years being 12% effective 1.10.2014 and 12% effective 1.10.2015
- 2.The CBA to run from 1.10.2014 for a term of 2 years ending on or about 1.10.2016
- 3.Subject to the orders in the judgment, the other provisions in the CBA to prevail as agreed between the parties
- 4.Parties to bear own costs of the suit
- Jurisdiction invoked
- Labour Relations Act, 2007 (certificate of unresolved dispute issued under section 69(a))
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kenya Union of Commercial Food and Allied Workers v Kangiri Farmers Co-Operative Society Limited [2015] KEELRC 675 (KLR)", Case Analysis (2015). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2015/675/eng@2015-07-31
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.