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ELRCPartially AllowedCause No. 2119 of 2014· [2015] KEELRC 781 (KLR)

Kenya Chemical And Allied Workers Union v East African Portland Cement Company Limited [2015] KEELRC 781 (KLR)

Employment and Labour Relations Court of Kenya
6 July 2015
2,385 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~10 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court ruled that contract workers who pay union dues deserve the same negotiated CBA pay as permanent staff doing similar work.

What this practically means

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Executive summary

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The Claimant union, holding a recognition agreement with the Respondent dating from 1961, filed a memorandum of claim on 26 November 2014 alleging that the Respondent selectively implemented the CBA signed on 19 December 2013 (effective 1 August 2012) by failing to effect the agreed new rates of pay to unionisable employees engaged on fixed term contracts, despite those employees paying union dues through check-off. Prior conciliation before a conciliator appointed by the Cabinet Secretary for Labour failed, the conciliator having recommended staggered implementation. The Claimant sought declarations of breach, withdrawal of inferior terms, conversion of contract employees to permanent terms, computation and payment of arrears, and special damages. The Respondent contended that contract staff were historically excluded from the CBA by a standing agreement and separate payment arrangements, that fixed term contracts are lawful under the Employment Act, and that incorporating contract staff would render operations unsustainable and force redundancies. It relied on Kenya Airways Ltd v Kenya Airliners Pilots Association and Kenya Plantation Workers Union v Unilever Tea Kenya Ltd. The court framed three issues and held that payment of union dues makes an employee a member covered by the CBA whether permanent or on contract; that the Respondent's concession to paying contract staff less breached the CBA; and that paying different wages for similar work is discriminatory under Section 5 of the Employment Act, Article 27 of the Constitution and ILO Conventions 98 and 100. The claim was found to have merit. The court ordered the Respondent to implement the CBA as negotiated and, where implementation is unsustainable, to renegotiate the implementation process towards an amicable settlement. The broader conversion, arrears and special damages prayers were not granted in those terms.

Key legal issues

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01

Whether contract staff who are union members are covered by the CBA

Holding

Contract employees who pay union dues through check-off are 'members' within the CBA and are covered by it.

Reasoning

The term 'Members' was undefined in the Memorandum of Agreement. The court turned to Section 48 of the Labour Relations Act, which defines trade union dues as a subscription required to be paid by a member. Payment of dues voluntarily deducted on the employee's express instructions is what constitutes membership. The prior dispute in Cause 1451/2011, settled by the Respondent agreeing to deduct and remit dues for the affected employees, confirmed their membership.

p. 4
02

Whether the Respondent breached the CBA by paying contract staff inferior wages

Holding

The Respondent breached the CBA by partially implementing it in favour of only workers on permanent engagement.

Reasoning

The Respondent conceded that contract staff are paid less than permanent unionisable staff, arguing implementation would cost KShs 71.3 million monthly and risk redundancies. Conceding differential pay amounted to breach of the CBA. The authorities cited by the Respondent were distinguished because they concerned adding un-negotiated terms, not breach of negotiated terms. Differential pay for similar work was also discriminatory under Section 5 of the Employment Act, Article 27 of the Constitution and ILO Conventions 98 and 100.

p. 5
03

Remedies for breach of the CBA

Holding

The Respondent was ordered to implement the CBA as negotiated, with renegotiation of implementation where it is unsustainable.

Reasoning

The court found the claim had merit. Rather than grant the full panoply of remedies sought (conversion to permanent terms, arrears, special damages), the court directed implementation of the CBA as negotiated, and where implementation problems arise on grounds of unsustainability, the parties should renegotiate the implementation process to reach an amicable settlement beneficial to all parties.

p. 5

Legal principles established

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  • Payment of trade union dues is what makes an employee a member of a trade union, and members paying union dues are covered by the CBA negotiated whether permanently employed or on contract.
  • Payment of different wages to workers performing similar work constitutes discrimination irrespective of whether they are on contract or permanent terms.

Court orders

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  1. 1.The Respondents to implement the Collective Bargaining Agreement as negotiated.
  2. 2.Where implementation is unsustainable, the Respondents should renegotiate the implementation process for purposes of reaching an amicable settlement beneficial to all parties.

Authorities

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Legislation

  • Labour Relations ActSection 48
  • Labour Relations ActSection 61(2)
  • Employment Act 2007Section 5
  • Constitution of KenyaArticle 27
  • Constitution of KenyaArticle 41
  • ILO Constitution 98Article 1
  • ILO Constitution 100 (Equal Remuneration Convention)Article 2

Cases cited (2)

  • Kenya Airways Limited vs Kenya Airliners Pilots Association
    (2013) eKLR
  • Kenya Plantation and Agricultural Workers Union vs Unilever Tea Kenya Limited
    (2013) eKLR
Jurisdiction invoked
Jurisdiction as the Industrial Court/Employment and Labour Relations Court over the registered collective bargaining agreement and the trade dispute reported under Section 61(2) of the Labour Relations Act, 2007

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (1)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Kenya Chemical And Allied Workers Union v East African Portland Cement Company Limited [2015] KEELRC 781 (KLR)", Case Analysis (2015). Cause No. 2119 of 2014. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2015/781/eng@2015-07-06

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