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ELRCPartially AllowedApplication dated 7th July 2017, amended 24th July 2017, arising from Cause No. 25 of 2004 (case number of the application not stated in the judgment)· [2018] KEELRC 674 (KLR)

Kenya Union of Commercial Food and Allied Workers Union v Kapa Oil Refineries Limited [2018] KEELRC 674 (KLR)

Employment and Labour Relations Court
9 November 2018
3,733 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
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The bottom line

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A Kenyan court replaced a 2004 reinstatement order with a rich compensation package because reinstating workers 15 years later was no longer practical.

What this practically means

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Executive summary

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The respondent employer applied, by a Notice of Motion dated 7th July 2017 and amended on 24th July 2017, for stay and review of the decree of 3rd July 2017 issued pursuant to the award of Hon. Justice Murtaza Jaffer dated 22nd December 2004 in Cause No. 25 of 2004, which ordered reinstatement of 106 grievants terminated on 20th December 2002. The respondent argued reinstatement after 15 years was impractical: the positions no longer existed, labour had been outsourced to third parties, and Section 12(3)(vii) of the Employment Act limits reinstatement to three years from dismissal. The claimant opposed, asserting the delay was occasioned by the respondent, that the Employment Act cannot apply retrospectively to an award made under the repealed Trade Disputes Act, that the application was res judicata given the earlier judicial review proceedings (JR No. 18 of 2005, dismissed by Dulu J in 2012), and that no decretal payments had been made. The court held: (1) res judicata does not apply, since judicial review and review of a decree are distinct; (2) the application, filed within 7 days of the decree, satisfied Rule 33 of the ELRC Rules, the impracticality of reinstatement being sufficient reason for review; and (3) Section 12(3)(vii) of the Employment Act cannot apply retrospectively, but reinstatement after 15 years would be impracticable. The court reviewed the decree, substituting reinstatement with compensation: six months' full wages, outstanding wages, leave pay and allowances, pay in lieu of notice, gratuity, twelve months' wages as compensation, all with interest from the date of the award and credit for sums already paid. It so ordered on 9th November 2018.

Key legal issues

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01

Res judicata

Holding

The plea of res judicata fails; the earlier judicial review application (JR No. 18 of 2005, dismissed by Dulu J on 6th July 2012) does not bar the present review application

Reasoning

The court accepted that the respondent had earlier challenged the award through judicial review proceedings which were dismissed. However, it held that judicial review and review of a decree are distinct processes: a review is not another suit but an application to amend or set aside a decision. Accordingly, the dismissal of the judicial review application could not found a plea of res judicata against the review application.

p. 2
02

Whether the court can review the decree of 3rd July 2017

Holding

Yes - the application was filed within 7 days of the decree, without unreasonable delay, and the impracticality of reinstating 106 grievants after 15 years constitutes 'sufficient reason' under Rule 33 of the ELRC Rules

Reasoning

The court applied Rule 33(1) of the ELRC Rules and the Origo v Mungala principles. The application was filed 7 days after the decree, so there was no delay. The respondent's reason - that reinstatement was impractical and would require training the 106 grievants afresh - was held to be sufficiently analogous to the enumerated grounds to constitute 'any other sufficient reason' warranting review.

p. 3
03

Retrospectivity of the Employment Act three-year reinstatement limit

Holding

Section 12(3)(vii) of the Employment Act does not apply retrospectively; the award predates the Employment Act and is governed by the Trade Disputes Act, which imposed no time limit on reinstatement orders

Reasoning

The award was made on 22nd December 2004 under the repealed Trade Disputes Act, before the Employment Act No. 11 of 2007 came into force. Relying on Kenya Ports Authority v Odongo and the Supreme Court's non-retroactivity principle, the court held there is no express legislative intent for retrospective application, and paragraph 2(4) of the Fifth Schedule of the Labour Relations Act confirms the repealed Act governs pre-commencement disputes.

p. 3
04

Practicability of reinstatement

Holding

Reinstatement after 15 years is impractical; the grievants are entitled to the alternative award of compensation and terminal dues in Order 4 of the award

Reasoning

Balancing the equities, the court noted the organisation had changed, labour had been outsourced to third parties, and retraining would be required. However, because the delay was occasioned by lengthy litigation, it would prejudice the grievants to deprive them of the award. The court therefore exercised its discretion to review the decree by substituting reinstatement with the compensation package already provided in the alternative Order 4 of the award.

p. 4

Legal principles established

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  • Section 12(3)(vii) of the Employment Act cannot be applied retrospectively to bar reinstatement ordered under the repealed Trade Disputes Act, which set no time limit for reinstatement
  • An application for review of a decree or order is not barred by res judicata even where a judicial review application on the same award was previously dismissed
  • Impracticability of reinstatement is assessed by balancing the interests of the parties, including the prospective effects of reinstatement on the employer, other employees and third parties

Court orders

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  1. 1.The decree of 3rd July 2017 is reviewed such that the reinstatement order is substituted with compensation
  2. 2.The respondent to pay to the grievants compensation amounting to 6 months of their full wages inclusive of house allowance and other allowances
  3. 3.The respondent to pay each grievant all outstanding wages due from the date of termination to date of judgment, leave pay and allowances provided for in the CBA
  4. 4.The respondent to pay each grievant pay in lieu of notice in accordance with clause 11 of the CBA
  5. 5.The respondent to pay each grievant gratuity in accordance with clause 26 of the CBA
  6. 6.The respondent to pay each grievant twelve (12) months wages by way of compensation based on gross monthly pay
  7. 7.All payments to attract interest from the date of the award
  8. 8.All sums already paid by the respondent to be taken into account in the implementation of the award

Authorities

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Legislation

  • Employment ActSection 12(3)(vii)
  • Trade Disputes Act (repealed)Section 15(1)
  • Employment and Labour Relations Court RulesRule 33(1) and (6)
  • Labour Relations ActParagraph 2(4) of the Fifth Schedule
  • Employment Act No. 11 of 2007general
  • Employment and Labour Relations Court Act, 2011general

Cases cited (12)

  • Kenya Airways Limited v Aviation & Allied Workers Union Kenya & 3 Others
    [2014] eKLR
  • Mburu Muthoka v Chairman Kinangop Land Control Board, Secretary Central Land Control Board, Attorney General Njunge Njenga
    [2004] eKLR
  • Delkan Enterprises Limited v Masaku County Council
    [2008] eKLR
  • John Florence Maritime Services Limited and Another v Cabinet Secretary for Transport and Infrastructure and 3 Others
    [2015] eKLR
  • Kipkorir v Langat & Another
    (2008) 3 KLR
  • Francis Origo & Another v Jacob Kumali Mungala
    C.A Civil Appeal No. 149 of 2001 (2005 2 K.L.R 307)
  • Republic v Public Procurement Review Board & 2 Others
    [2018] eKLR
  • Evan Bwire v Andrew Nginda
  • Kenya Ports Authority v Andrew Ochieng Odongo
    [2017] eKLR
  • Samuel Kamau Macharia & Another v Kenya Commercial Bank Limited & 2 Others
    Civil Application No. 2 of 2011
  • Omunyokol v Attorney General
    (Civil Appeal No. 06 of 2012) (2012) UGSC 4 (8 April 2015)
  • New Zealand Educational Institute v Board of Trustees of Auckland Normal Intermediate School
Jurisdiction invoked
Rule 33(1) and (6) of the Employment and Labour Relations Court Rules (review of decree)

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, "Kenya Union of Commercial Food and Allied Workers Union v Kapa Oil Refineries Limited [2018] KEELRC 674 (KLR)", Case Analysis (2018). Application dated 7th July 2017, amended 24th July 2017, arising from Cause No. 25 of 2004 (case number of the application not stated in the judgment). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/674/eng@2018-11-09

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