Kenya Building, Construction, Timber, Furniture and Allied Industries Union v Jubilee Jumbo Hardware Limited [2018] KEELRC 226 (KLR)
The bottom line
#Kenya's Employment and Labour Relations Court ruled that employers who sign recognition agreements must negotiate a collective bargaining agreement until that agreement is properly terminated.
What this practically means
#Executive summary
#Key legal issues
#Whether the respondent is statutorily and constitutionally bound to negotiate a CBA with the union
Yes. Under Section 54(3) of the Labour Relations Act, an employer who has signed a recognition agreement is obliged to negotiate and sign a CBA. The respondent never terminated the recognition agreement, produced no evidence of employee resignations from the union, and still employs unionisable employees with a constitutional right under Article 41 to join a trade union.
The court relied on Section 54(1), (2), (3) and (5) of the Labour Relations Act. Since the respondent did not take steps to terminate the recognition agreement under Section 54(5), the agreement remains in place and binds the respondent to negotiate. Allegations that employees resigned were unsupported by any evidence. Article 41 of the Constitution protects employees' right to join a trade union.
Determination of the CBA clauses not agreed upon (effective date, annual leave, safari allowance, hours of work, tools allowance, rates of pay, house allowance)
The court made determinations on each disputed clause, adopting the CPMU report in part and guided by the wages guidelines, awarding a 10% general wage increase per year, minimum rates at 5% above statutory rates, and retaining certain outgoing CBA provisions.
The claimant adopted the CPMU economic report; the respondent filed no submissions. The court considered both parties' proposals clause by clause, applying the wages guidelines, inflation and cost-of-living considerations, and the principle that terms can only be retained or improved. The effective date was fixed as the anniversary of the expired CBA.
Legal principles established
#- An employer who has signed a recognition agreement with a union is under obligation to sign a collective agreement with the union, and can only disengage from that obligation by terminating the recognition agreement under Section 54(5) of the Labour Relations Act
- The effective date of a successor CBA is the anniversary of the last agreement between the parties, so employees remain covered during periods when no CBA has been concluded
- A term of service can only be retained as it is or improved upwards, never reduced
Court orders
#- 1.Effective date for the CBA is 1st June 2009
- 2.Annual leave retained at 26 days as in the outgoing CBA
- 3.Safari allowance awarded at Kshs.500 across the board
- 4.Overtime to be calculated as provided by law, being 1.5 times the normal hourly rate for regular overtime and double the hourly rate for overtime during public holidays and rest days
- 5.Tools allowance clause retained as in the outgoing CBA
- 6.General wage increase of 10% for the first year and a further 10% for the second year
- 7.House allowance retained at 20% of basic wage
- 8.Minimum rates of pay (Part 1(a) of the CBA) pegged at 5% above gazetted statutory minimum rates of pay
- 9.Each party shall bear its costs
- Jurisdiction invoked
- Employment and Labour Relations Court Act, Section 15(5); Labour Relations Act (dispute referred to the Industrial Court following conciliation)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kenya Building, Construction, Timber, Furniture and Allied Industries Union v Jubilee Jumbo Hardware Limited [2018] KEELRC 226 (KLR)", Case Analysis (2018). Not stated in the judgment as provided. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/226/eng@2018-12-06
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.