The Long Distance Truck Drivers and Allied Workers Union v Malva Coach Builders Limited [2018] KEELRC 1118 (KLR)
The bottom line
#A Kenyan court ruled an employer cannot cut established allowances or refuse a negotiated CBA without justification, and reinstated unfairly dismissed workers.
What this practically means
#Executive summary
#Key legal issues
#Refusal to sign the negotiated CBA
The respondent failed to provide any justifiable reason for refusing to sign the negotiated CBA; joining the NCBG-FKE group, which simply does not pay transport allowances, was not justification.
The transport allowance was payable under the previous CBA and the respondent sought to discontinue it solely because it joined the NCBG-FKE group. The group gave no reasons or justification for not paying the allowance and produced no counter-balancing provision in the CBA to offset it. Nothing new would be introduced in the CBA causing additional financial burden to the respondent. The court was therefore not satisfied that refusal to sign was justified.
Discontinuance of transport allowance
Discontinuance of an allowance is a variation of the employment contract that must be justified, and in extreme cases can amount to constructive dismissal.
Salary and emoluments are a significant aspect of an employee's livelihood and an employee's life revolves around them once set. Removal of an allowance revises downwards a lifestyle the employees had been attuned to and must be properly explained and justified. No justification was provided for discontinuing the transport allowance, amounting to an impermissible variation of the contract.
Dismissal for participation in an unprotected strike
The respondent had the right to dismiss employees for participating in an unprotected strike, but reinstatement or compensation was ordered because the dismissals were entangled with the unjustified discontinuance of the transport allowance.
While the respondent reserved the right to dismiss employees who participated in the unprotected strike, there was disquiet over its intention to discontinue the transport allowance, which amounted to a downward revision of the employees' lifestyle. In the circumstances the court ordered reinstatement without back pay, or alternatively terminal dues plus five months' salary as compensation for unfair termination.
Legal principles established
#- Discontinuance of an established allowance is a variation of the employment contract which must be properly explained and justified, and may amount to constructive dismissal.
- An employer has the right to dismiss employees who participate in an unprotected strike.
Court orders
#- 1.The respondent is ordered to sign or cause to be signed the negotiated CBA
- 2.Reinstatement of the dismissed employees without payment for the period out of employment and subject to availability of the positions they held prior to dismissal
- 3.In the alternative, payment of all terminal dues if not paid at the time of dismissal plus five months' salary as compensation for unfair termination of services
- Jurisdiction invoked
- Article 162(2)(a) of the Constitution establishing the Employment and Labour Relations Court (implied by the court's jurisdiction over the employment dispute; not expressly quoted in the judgment)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "The Long Distance Truck Drivers and Allied Workers Union v Malva Coach Builders Limited [2018] KEELRC 1118 (KLR)", Case Analysis (2018). Cause 150 of 2016. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/1118/eng@2018-09-21
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.