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ELRCOtherCause (number not stated in judgment)· [2018] KEELRC 513 (KLR)

Amalgamated Union Of Kenya Metal Workers v Aucma Digital Technology Africa Ltd [2018] KEELRC 513 (KLR)

Employment and Labour Relations Court
30 November 2018
RSRadido Stephen
925 words in judgment
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The bottom line

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Kenya's Employment Court confirmed it can impose CBA terms on employers, but declined here because the economic data was outdated, ordering fresh negotiations instead.

What this practically means

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Executive summary

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The Union sued the Respondent in a dispute stated as the Respondent's refusal to negotiate a Collective Bargaining Agreement. The parties had signed a recognition agreement on 22 May 2009; the Union forwarded CBA proposals, the Respondent declined to negotiate, and a trade dispute reported to the Minister for Labour was conciliated by Mr. L.K. Bii without resolution. The Union sought one substantive order: that the Court order the Respondent to compensate its members by signing the proposed CBA. At the hearing neither party called witnesses; both relied on the record and submissions. The Court framed the central question as whether it could impose terms and conditions of service through a CBA where the social partners had failed to agree. Drawing on the Court of Appeal's decision in Kenya Tea Growers Association v Kenya Plantation & Agricultural Workers Union, the Court held that Section 26(2) of the Employment Act empowers the ELRC to issue terms more favourable than statutory minima, and that it has jurisdiction to intervene, but must act judiciously and on a case by case basis. On the facts, the Court declined to intervene: the dispute had been in the court system for about 8 years and the Central Planning & Monitoring Unit report covered only economic trends from 2011 to 2014, so any award risked crippling the Respondent or denying employees terms at prevailing rates. The Court terminated the proceedings, directed the parties to commence and conclude fresh CBA negotiations within 60 days, with liberty to invoke Part VIII of the Labour Relations Act in case of stalemate, and made no orders as to costs.

Key legal issues

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01

Whether the Court can impose CBA terms where parties have failed to agree

Holding

Yes, the Court has jurisdiction to intervene and impose favourable terms, but the exercise of that power is discretionary and must be exercised judiciously on a case by case basis

Reasoning

Relying on the Court of Appeal's decision in Kenya Tea Growers Association, the Court accepted that Section 26(2) of the Employment Act not only permits parties to agree on terms more favourable than statutory minima but also empowers the ELRC to issue such favourable terms when resolving an economic dispute over CBA terms. Jurisdiction however does not compel intervention in every case.

p. 2
02

Whether this was a suitable case for intervention

Holding

No - the Court declined to impose CBA terms because the economic evidence before it was stale

Reasoning

The dispute had been in the court system for about 8 years, and the Central Planning & Monitoring Unit report covered economic trends only from 2011 to 2014. Without current economic data, the Court risked making awards that could cripple the Respondent or deny employees terms at prevailing rates. It therefore terminated the proceedings and directed fresh negotiations.

p. 2

Legal principles established

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  • The Employment and Labour Relations Court has jurisdiction to intervene and impose terms of a collective bargaining agreement where parties fail to agree, but should act judiciously and on a case by case basis
  • Section 26(2) of the Employment Act empowers the ELRC to issue terms more favourable than statutory minima in a CBA dispute

Court orders

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  1. 1.Termination of these proceedings
  2. 2.Parties to start a fresh round of and conclude a collective bargaining agreement within 60 days
  3. 3.In case of a stalemate, the Union is at liberty to invoke the provisions of Part VIII of the Labour Relations Act
Jurisdiction invoked
Dispute referred to the Court under the Labour Relations Act; jurisdiction to impose CBA terms derived from Section 26(2) of the Employment Act as interpreted by the Court of Appeal in Kenya Tea Growers Association

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, "Amalgamated Union Of Kenya Metal Workers v Aucma Digital Technology Africa Ltd [2018] KEELRC 513 (KLR)", Case Analysis (2018). Cause (number not stated in judgment). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/513/eng@2018-11-30

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