Charles Kariuki & 11 others v Kenya Plant Health Inspectorate Service (Kephis) & another [2015] KEELRC 1092 (KLR)
The bottom line
#A Kenyan court ruled KEPHIS must pay former workers salary arrears and NSSF refunds because an MOU transferred the workers and their liabilities to KEPHIS.
What this practically means
#Executive summary
#Key legal issues
#Whether the Claimants were employees of KARI and/or KEPHIS
Yes - the secondary documentation (NSSF schedules, muster roll, registration certificates, to Whom It May Concern letters and the MOU) established an employment relationship with KEPHIS and/or KARI.
Although the primary document demonstrating employment is a written contract, the law recognises oral contracts, so the relationship may be inferred from secondary sources. The Claimants were registered with NSSF with KARI or N.S.Q.C.R.S. as employer, appeared on a KARI muster roll, and received service letters from the 1st Respondent. The MOU between KARI and KEPHIS transferred the Claimants with staff liabilities. The 2nd Respondent also admitted in submissions that the Claimants worked for KARI for many years.
Which of the Respondents bears liability for the Claimants' contractual entitlements
The 1st Respondent (KEPHIS) is liable; the 2nd Respondent (KALRO) is not, because KEPHIS was neither dissolved nor a 'former institution' under the KALRO Act.
Sections 54(c), 55 and 58 of the KALRO Act transfer the assets and liabilities of former institutions, including KARI, to KALRO, so KALRO would have been liable had KARI been found liable. However, the MOU between KARI and KEPHIS transferred the Claimants and their staff liabilities to KEPHIS, which remains legally alive and was not listed in the fourth schedule or suggested to be a former institution. Liability therefore rests with the 1st Respondent.
Salary arrears and NSSF refunds
Awarded as computed in the annexure to the Further Further Amended Plaint, the Respondents having challenged only legal liability and not the computations.
The Claimants did not quantify the arrears in the Plaint but annexed computations to the Further Further Amended Plaint. The Respondents' defences were canvassed purely on legal liability and did not challenge the computations, so the Court found for the Claimants as computed. The NSSF refund of Kshs 240 per Claimant was also awarded to bring the longstanding litigation to an end, the Act itself providing mechanisms for unremitted contributions.
Legal principles established
#- Under section 55 of the KALRO Act, pending actions against a former institution are prosecuted against KALRO and do not abate; and under section 54(c), KALRO took over the assets and liabilities of KARI.
- The existence of an employment relationship can be inferred from secondary sources, including NSSF registration and deductions, muster rolls and letters of service, since oral contracts are recognised.
- Where staff and staff liabilities are contractually transferred under an MOU, liability for their claims attaches to the transferee.
Court orders
#- 1.The Court finds and holds that the 1st Respondent is legally liable to the Claimants
- 2.The 1st Respondent to pay the Claimants salary arrears and NSSF refunds as per the annexure to the Further Further Amended Plaint
- 3.The Claimants to have costs of the Cause to be borne by the 1st Respondent
- 4.The 2nd Respondent to bear its own costs
- Jurisdiction invoked
- Transfer of the suit from the Chief Magistrate's Court to the Employment and Labour Relations Court (employment and labour relations jurisdiction)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Charles Kariuki & 11 others v Kenya Plant Health Inspectorate Service (Kephis) & another [2015] KEELRC 1092 (KLR)", Case Analysis (2015). Nakuru Chief Magistrate's Court Civil Case No. 1971 of 2003 (transferred to the Employment and Labour Relations Court). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2015/1092/eng@2015-05-22
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.