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ELRCOtherELRC Cause No. 137 of 2016· [2016] KEELRC 1032 (KLR)

Abdullahi Ali Mohammed v Kenya Ports Authority & another [2016] KEELRC 1032 (KLR)

Employment and Labour Relations Court
27 June 2016
JRJames Rika
2,675 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Employment Court confirmed that retired employees can sue former employers over post-employment benefits like staff housing.

What this practically means

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Executive summary

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The Claimant, employed by Kenya Ports Authority since 1980, occupied a staff house at Mbaraki. In 2002 the houses were transferred to the KPA Pension Scheme (2nd Respondents), with employees told they would sign leases and get purchase options, which never materialised. Upon retirement effective 22nd February 2016, the Claimant was required to vacate. He filed this Claim on 4th March 2016 seeking an injunction and a declaration of entitlement to exclusive possession, and obtained an interim injunction. The Respondents filed a Notice of Preliminary Objection arguing the ELRC lacked jurisdiction: the Claimant was retired, and any dispute with the Scheme Trustees was a pension dispute for the Retirement Benefits Act mechanisms under Section 46. The Claimant countered that housing is an employment matter and that the objection breached the Mukisa Biscuits principle. Relying on the Court of Appeal decision in Trustees v. Maurice Munyao, which held that Section 46 of the Retirement Benefits Act does not oust the ELRC's original jurisdiction over pensioner disputes, and on its own decision in Hakika Transporters endorsing a broad reading of Section 12, the Court held it is constitutionally bound by the Court of Appeal and has jurisdiction. The Court further held that termination of employment does not end jurisdiction over post-employment obligations, and that on the prima facie facts this is a dispute between an ex-Employer and ex-Employee over a staff house occupied under Section 31 of the Employment Act, not a pension dispute. The Preliminary Objection was rejected, the interim orders extended, with no order on costs.

Key legal issues

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01

Jurisdiction over pensioner disputes

Holding

Section 46 of the Retirement Benefits Act does not oust the ELRC's original jurisdiction in pension disputes, per the Court of Appeal in Trustees v. Maurice Munyao

Reasoning

The Court of Appeal at Malindi held that Section 46 of the Retirement Benefits Act does not take away the original jurisdiction of the ELRC in hearing and determining disputes between pensioners and their schemes. This Court is constitutionally bound by that decision, and the Respondents could not raise a preliminary objection premised on an argument already settled in an appeal involving themselves.

p. 3
02

Post-employment obligations and jurisdiction

Holding

Termination of employment does not end the Court's jurisdiction over disputes relating to or incidental to the terminated contract

Reasoning

The employment contract creates both short-term obligations and post-employment obligations such as pensions, housing and medical care. The mutuality of obligations does not always end with termination. The personal jurisdiction of the Court extends beyond current employers and employees to other parties implicated in employment and labour relations disputes.

p. 4
03

Nature of the dispute over the staff house

Holding

On the prima facie facts, the dispute over the staff house is not a pension dispute but a dispute between an ex-Employer and an ex-Employee

Reasoning

The Claimant occupied the staff house under Section 31 of the Employment Act 2007 pursuant to his terms and conditions of service, not under the Pension Scheme rules. It is the 1st Respondent, not the Scheme Trustees, demanding vacant possession, and ownership of the houses is unclear. These facts require full hearing rather than summary dismissal.

p. 4

Legal principles established

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  • The Employment and Labour Relations Court retains jurisdiction over disputes arising out of or relating to a terminated contract of employment, including post-employment benefits
  • Pension disputes are at the core of the Court's mandate under Article 162(2)(a)

Court orders

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  1. 1.Preliminary Objection rejected
  2. 2.Parties to agree on a date for the main application
  3. 3.Interim order given on 4th March 2016 extended
  4. 4.No order on the costs

Authorities

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Legislation

  • Employment and Labour Relations Court ActSection 12
  • Retirement Benefits ActSection 46; Cap 187
  • Employment ActSections 31, 35(5), 35(6)
  • Constitution of KenyaArticle 162(2)(a)
  • Fair Administrative Action Act

Cases cited (7)

  • Abdi Mohammed Daib v. Kenya Ports Authority
    [2015] e-KLR
  • Mukisa Biscuits
  • Trustees of Pension Scheme v. Maurice Munyao & 148 Others
    Civil Appeal Number 38 of 2014
  • Director of Pensions v. Cockar
    [2000] 1 E.A. 37
  • Teachers Service Commission v. Simon P. Kamau & 19 Others
    Court of Appeal Civil Appeal Number 300 of 2009
  • Teachers Service Commission v. Simon P. Kamau
    High Court Civil Case Number 65 of 2006
  • Hakika Transporters Services Limited v. Kenya Long Distance Truck Drivers and Allied Workers Union
    [2015] e-KLR
Jurisdiction invoked
Article 162(2)(a) of the Constitution; Section 12 of the Employment and Labour Relations Court 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, "Abdullahi Ali Mohammed v Kenya Ports Authority & another [2016] KEELRC 1032 (KLR)", Case Analysis (2016). ELRC Cause No. 137 of 2016. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2016/1032/eng@2016-06-27

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