Kenya Engineering Workers Union v Motorways Kenya Limited [2018] KEELRC 2381 (KLR)

Employment and Labour Relations Court

14 February 2018

HWHellen Wasilwa

652 words in judgment

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The bottom line

Kenya's Employment Court ruled that a redundancy ignoring a union agreement's notice and benefits was flawed, and ordered full terminal dues.

What this practically means

Executive summary

This was a first-instance employment claim before the Employment and Labour Relations Court in which the Claimant challenged an intended redundancy of three Grievants - Joseph Mwololo Maweu (Electrician, employed 2011), George Oduor Oloko (Mechanic, employed 1987) and Wilson Ndungu Nyoike (Driver, employed 1995). Redundancy notices dated 30th September 2017 were to take effect immediately, prompting an urgent application filed on 22nd September 2017; on 28th September 2017 the Court stopped the intended redundancy pending hearing and directed the parties to explore settlement, with Mr. Martin Njiri Advocate attempting reconciliation and filing a report on 10th October 2017. The Claimants contended the notices were unlawful and unfair because they ignored the Collective Bargaining Agreement signed on 1st January 2012. The Court found the CBA remained in force indefinitely under Clause 33, no amendment notice having been issued, and that under Clause 18 the Grievants were entitled to three months' notice, payment of wages and remuneration due, severance pay, and transport allowance. The Court held the redundancy notices were flawed but that the redundancy should proceed, awarding each Grievant pay in lieu of three months' notice, Kshs. 10,000 transport costs, severance/service pay at 26/30 of monthly salary per completed year of service, and unpaid salary for October and November 2017, less statutory deductions, with totals of Kshs. 447,014/=, Kshs. 904,846/= and Kshs. 454,101/= respectively. Gratuity was refused as the Grievants were NSSF members. The Respondent was ordered to pay the costs of the suit.

Key legal issues

Validity of redundancy notices vis-à-vis the Collective Bargaining Agreement

Holding

The notices were unlawful and unfair for ignoring the CBA's three months' notice and redundancy benefits

Reasoning

The parties had a valid CBA signed on 1st January 2012 which, by Clause 33, continues in force indefinitely until amended by two months' notice, which had not been given. Clause 18 entitled the Grievants to three months' notice before redundancy, wages and remuneration due, severance pay of 20 days per completed year, and transport allowance. Issuing redundancy notices to take immediate effect, without these entitlements, rendered the notices flawed.

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Entitlement to terminal dues on redundancy

Holding

Each Grievant entitled to pay in lieu of three months' notice, transport allowance, severance/service pay at 26/30 days per completed year, and unpaid salary for October and November 2017

Reasoning

Applying the CBA redundancy clause, the Court computed for each Grievant three months' pay in lieu of notice, Kshs. 10,000 transport costs, severance/service pay calculated at 26/30 of the monthly salary for each completed year of service, and salary owing for October and November 2017. Gratuity was excluded because the Grievants were NSSF members. Amounts payable less statutory deductions.

p. 1

Legal principles established

A redundancy that disregards the notice period and benefits provided in a subsisting Collective Bargaining Agreement is flawed and unlawful

Court orders

1.The redundancy should proceed but the Grievants be paid their dues as assessed
2.1st Grievant (Joseph Mwololo Maweu) to be paid Kshs. 447,014/= less statutory deductions
3.2nd Grievant (George Oloko) to be paid Kshs. 904,846/= less statutory deductions
4.3rd Grievant (Wilson Nyoike) to be paid Kshs. 454,101/= less statutory deductions
5.Claim for gratuity not payable as Claimants were members of NSSF
6.Respondent to pay costs of the suit

Jurisdiction invoked: Employment and Labour Relations Court jurisdiction over employment disputes (reference to redundancy and Collective Bargaining Agreement); no specific constitutional provision cited

Key timeline

Practical implications

Frequently asked questions

Cite this brief

Caselaw, "Kenya Engineering Workers Union v Motorways Kenya Limited [2018] KEELRC 2381 (KLR)", Case Analysis (2018). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/2381/eng@2018-02-14

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