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ELRCPartially Allowed· [2018] KEELRC 1531 (KLR)

Tailors and Textiles Workers Union v Mills Industries Limited [2018] KEELRC 1531 (KLR)

Employment and Labour Relations Court
6 July 2018
664 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 ruled workers still benefit from a collective bargaining agreement even after its period expires, awarding a 10% wage increase.

What this practically means

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Executive summary

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By a reference filed on 10th April 2013, the claimant union sought the court's decision on five disputed issues in a negotiated CBA covering 1st June 2012 to 31st May 2014: general wage increment, basic wage for new entrants, house allowance, safari allowance and gratuity. The respondent contended the claim had been overtaken by events since the CBA period had expired, and attributed its refusal to accede to an unfavourable business environment and losses. The union disputed this, pointing to the respondent's supply of uniforms to security agencies in Kenya, Uganda and Rwanda and fabric sourcing under AGOA, and blamed the respondent for delaying negotiations before the Minister. The court relied on a CPMU report, which it treated as a technical report removed from the subjective views of the parties. The report showed a constant trend in unionisable staff, a gradual rise in the annual wage bill, and a 10% CPI rise over the period, entitling members to compensation for loss of purchasing power. The court held that although the CBA period had long passed, workers employed during that period were entitled to benefit from the negotiated CBA, and that paying only the government minimum wage would be the lazy approach absent good cause. The court awarded a 10% increment over the minimum wage for the CBA period, and directed that the other disputed aspects of the CBA be incorporated and negotiated afresh in the subsequent CBA if not already done. Judgment was delivered at Nairobi on 6th July 2018 by Abuodha J. N.

Key legal issues

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01

Whether expiry of the CBA period renders the reference moot

Holding

The claim was not moot; workers employed during the CBA period are entitled to the benefits of the negotiated CBA.

Reasoning

The respondent argued the claim had been overtaken by events and there would be no value in hearing it. The court rejected this, holding that the delay was attributable in part to the respondent dragging its feet in the negotiations before the Minister, and that workers who were in employment during the CBA period must benefit from the negotiated and concluded CBA notwithstanding that the period had passed.

p. 1
02

Quantum of general wage increment

Holding

A 10% increment over the minimum wage was awarded, based on the CPMU report's finding on the rise in cost of living indices.

Reasoning

The court accepted the CPMU report as a technical report removed from the subjective views of the disputants. It found the CPI rise was 10% and that members were entitled to compensation for loss of purchasing power. Although the respondent claimed economic hardship and reliance on the Labour Day 14% increase, it never made an offer on wage increment, and paying only the government minimum wage would be the lazy approach absent good cause.

p. 1
03

Disputed CBA clauses other than wage increment

Holding

The remaining disputed clauses were not awarded directly but remitted to negotiation in the subsequent CBA.

Reasoning

Five issues were disputed: general wage increment, basic wage for new entrants, house allowance, safari allowance and gratuity. The court awarded only the 10% increment and directed that the other disputed aspects be incorporated and negotiated afresh in the subsequent CBA if not already done, effectively declining to make findings on each of the remaining clauses.

p. 2

Legal principles established

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  • Workers in employment during the period covered by a CBA remain entitled to benefit from the CBA negotiated and concluded even after the CBA period has passed.
  • The statutory minimum wage is a floor, and paying only the minimum wage is not the proper approach absent good cause.
  • Workers are entitled to compensation for loss of purchasing power measured against the rise in cost of living indices.

Court orders

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  1. 1.A 10% increment over the minimum wage for the period of the CBA awarded to the claimant's members
  2. 2.The other disputed aspects of the CBA to be incorporated and negotiated afresh in the subsequent CBA if not already done
Jurisdiction invoked
Reference on a disputed negotiated CBA under the Labour Relations Act (dispute referred following mediation by the Minister); specific provision not stated in the judgment

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, "Tailors and Textiles Workers Union v Mills Industries Limited [2018] KEELRC 1531 (KLR)", Case Analysis (2018). . Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/1531/eng@2018-07-06

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