Transport and Allied Workers Union v Comarco Properties [EPZ] Limited [2015] KEELRC 1305 (KLR)
The bottom line
#A Kenyan court awarded a retired executive over Kshs. 4 million in service pay and commission because his employer's paperwork was vague and incomplete.
What this practically means
#Executive summary
#Key legal issues
#Union representation of a managerial employee
The Grievant, though titled Executive Director, held no decisional role and was a paid-up union member, so the Union could represent him.
The Court found the Grievant could not hire, fire or discipline other employees; his titles explained nothing of a decisional or supervisory role. He was a paid-up member of the Claimant Union from 2010, evidenced by receipt and membership card. Trade unions have a broader role in representing workers beyond the unionisable/non-unionisable dichotomy, and freedom of association entitled him to the limited benefit of legal representation in Court.
Whether the contract was terminated or retirement was consensual
The Grievant retired voluntarily on mutually agreed terms at the end of 2008; no unfair termination occurred.
The Court relied on the Memorandum of Discussions of 23rd October 2008 and Peter Phillips' email of 18th November 2008 showing agreement that the Grievant would retire at the end of 2008 and consult on commission. The Grievant received terminal benefits of Kshs. 616,348 and did not protest. Inconsistent claims of suspension and forced retirement were rejected; there was no law or policy mandating a specific retirement age, making the age argument irrelevant.
Entitlement to further terminal dues
The Grievant was deprived of service pay for 1982 to 2004; awarded service pay at 15 days' salary per year for 22 years, totalling Kshs. 2,030,769.
The pay statement itemising 'Others' and 'Redundancy allowance' failed the clarity threshold under Section 20 of the Employment Act 2007. The Acknowledgment and Discharge did not state the amount or details, so it could not discharge the Respondent. The alleged further payment of Kshs. 2 million (or 1.4 million) in cash was unacknowledged, inconsistently stated, and shrouded in mystery, so the ambiguity was resolved in the employee's favour. Claims for notice pay, leave pay and travelling allowance failed for want of evidence.
Commission for the Lamu Jetty Project
The Grievant gave input in securing the Lamu contract per the retirement agreement; commission payable at 1% of the contract value, Kshs. 2,135,941.
The commission agreement was sealed in the meeting of 23rd October 2008 and Phillips' email of 18th November 2008. The Grievant's email of 20th January 2009 and Phillips' email of 5th February 2009 barring him from the Lamu Jetty showed he had given input. The Respondent locking him out was aimed at dispossessing him of his commission. The Public Procurement and Disposal Act argument failed; he was not contracted to corrupt anyone. As the exact rate (1% or 2%) was inconclusive, 1% was awarded.
Jurisdiction over the commission claim
The claim for commission is properly an employment issue within the Court's jurisdiction.
The Respondent argued the commission claim fell outside Section 12 of the Industrial Court Act 2011. The Court held the commission agreement arose from the terms of the Grievant's retirement from one sister company to another; a term of retirement is an employment issue. The 'consultant' label was used loosely to cloud an employer-employee relationship; the Grievant continued working from the Respondent's premises under the control of Phillips and Simon, making it a continuation of employment.
Legal principles established
#- All the law requires for a Trade Union Official to represent an Employee in Court is that the Employee is a member of that Trade Union.
- There is no mandatory retirement age for private sector employees; retirement age is a matter of contract or workplace policy.
- Where terms of engagement and disengagement are ambiguous, the court must accept the position favouring the employee.
- An unacknowledged cash payment of terminal dues, inconsistently stated and lacking detail, is not established.
- A commission arrangement arising from terms of retirement is an employment issue within the Industrial Court's jurisdiction.
Court orders
#- 1.The Grievant retired voluntarily from regular employment on 31st December 2008
- 2.The prayer for re-instatement is declined
- 3.The Grievant shall be paid by the Respondent service pay for a period of 22 years, computed at Kshs. 2,030,769
- 4.The Grievant shall be paid by the Respondent commission in accordance with the terms of the retirement agreement, computed at Kshs. 2,135,941
- 5.The total sum of Kshs. 4,166,710 shall be paid to the Grievant by the Respondent through the Claimant Union within 30 days of the delivery of this Award
- 6.No order on the costs and interest
- Jurisdiction invoked
- Section 12 of the Industrial Court Act 2011; Industrial Court (Procedure) Rules 2010, Rule 27(1)(a)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Transport and Allied Workers Union v Comarco Properties [EPZ] Limited [2015] KEELRC 1305 (KLR)", Case Analysis (2015). Cause Number 118 of 2012 (Originally Cause Number 497 of 2011, Industrial Court at Nairobi). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2015/1305/eng@2015-03-20
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.