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ELRCDismissedCause No 645 of 2015· [2016] KEELRC 1788 (KLR)

Alfred Elijah Rori v M-Kopa Kenya Limited [2016] KEELRC 1788 (KLR)

Employment and Labour Relations Court
29 January 2016
LNLinnet Ndolo
1,174 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan court refused to dismiss a worker's claim, ruling that calling someone a 'contractor' on paper does not decide whether they are truly an employee.

What this practically means

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Executive summary

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The Respondent, M-KOPA Kenya Limited, applied by Notice of Motion dated 9th September 2015 for striking out of the Claimant Alfred Elijah Rori's claim on the grounds that no employment relationship existed: the Claimant was said to be an independent sales representative under a 'M-KOPA Sales Representative Contract', whose Clause 7 declared contractor status, with payment by invoice and no salary. It followed, the Respondent argued, that the Employment and Labour Relations Court lacked jurisdiction and the suit was an abuse of process. The Claimant replied that he held a Company Identity Card as Sales Representative and was issued payslips, and that Clause 7 did not apply to him. The parties disposed of the application by written submissions. The Court accepted the principle that where there is no employment relationship it has no jurisdiction, citing the Lillian S decision. However, on examining the contract itself, the Court found the Claimant worked eight hours a day, six days a week, at a fixed daily rate of Kshs.1,400 grossed up monthly into predictable remuneration, leaving no room for outside assignments. Applying Ontario Ltd v Sagaz Industries Inc., the Court held that a disclaimer clause does not by itself nullify an employment relationship and that the total relationship, including the parties' behaviour, must be examined. It was unsafe to determine the issue at the interlocutory stage, and the question remained live for trial. The application was dismissed with costs in the cause.

Key legal issues

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01

Whether an employment relationship existed between the Claimant and the Respondent such that the Court has jurisdiction

Holding

The Court found it unsafe to rule out an employment relationship at the interlocutory stage; fixed daily pay grossed up monthly and compulsory six-day, eight-hour working hours suggested a contract of service notwithstanding the contractor-status clause

Reasoning

Applying the Supreme Court of Canada's guidance in Ontario Ltd v Sagaz Industries Inc., the Court examined the total relationship between the parties, not merely the labels in the contract. The contract itself provided for eight-hour days over six days weekly at a fixed daily rate grossed up to predictable monthly remuneration, leaving no capacity to take outside assignments. This contradicted the Clause 7 disclaimer, so the application to strike out was dismissed and parties left to call evidence at trial.

p. 3
02

Whether this Court has jurisdiction where no employment relationship exists

Holding

The Court accepted that absent an employment relationship it has no jurisdiction, anchored in Article 162(2)(a) and Section 12(1)(a) of the Employment and Labour Relations Court Act

Reasoning

The Court's jurisdiction is constitutionally confined to disputes relating to employment and labour relations, and statutorily to disputes arising out of employment between employer and employee. It therefore agreed that where no employment relationship exists, jurisdiction is absent, citing Owners of Motor Vessel 'Lillian S' v Caltex Oil (Kenya) Ltd on the centrality of jurisdiction. However, existence of the relationship was a matter for the evidence at trial.

p. 2

Legal principles established

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  • A disclaimer clause in a contract does not by itself nullify the existence of an employment relationship; the court must examine the total relationship between the parties
  • Where there is no employment relationship, the Employment and Labour Relations Court has no jurisdiction

Court orders

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  1. 1.The Respondent's Notice of Motion dated 9th September 2015 seeking striking out of the Claimant's claim is dismissed
  2. 2.Costs of the application to be in the cause

Authorities

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Legislation

  • Constitution of Kenya, 2010Article 162(2)(a)
  • Employment and Labour Relations Court ActSection 12(1)(a)
  • Employment Act, 2007Section 2 (definitions of employee, employer, contract of service)

Cases cited (2)

  • Owners of Motor Vessel “Lillian S” v Caltex Oil (Kenya) Ltd
    [1989] KLR 1
  • Ontario Ltd v Sagaz Industries Inc.
    2001 SCC 59
Jurisdiction invoked
Article 162(2)(a) of the Constitution; Section 12(1)(a) 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, "Alfred Elijah Rori v M-Kopa Kenya Limited [2016] KEELRC 1788 (KLR)", Case Analysis (2016). Cause No 645 of 2015. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2016/1788/eng@2016-01-29

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