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ELRCPartially AllowedCause No 2043 of 2016· [2019] KEELRC 327 (KLR)

Banking, Insurance & Finance Union (Kenya) v KCB Bank (Kenya) Limited [2019] KEELRC 327 (KLR)

Employment and Labour Relations Court
28 October 2019
HWHellen S. Wasilwa
2,023 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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What this practically means

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Executive summary

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The Claimant union sued on behalf of its grievant, Nickson Ongeri Elijah, an accounts clerk employed by KCB Bank (Kenya) Limited on successive fixed-term contracts between 2011 and 5 November 2015. It claimed that non-renewal of the contract amounted to unfair termination and that the grievant was discriminated against by being paid below the CBA scale for clerical staff. The Claimant sought reinstatement, salary of Kshs. 938,592, notice pay, leave pay and allowance, and Kshs. 1,660,221 as CBA underpayments. The Respondent maintained that the grievant was on fixed-term contracts which expired by effluxion of time, that non-renewal was due to the grievant's failure to produce a degree certificate required for clerical staff, and that the CBA never applied to him since he was not a union member until May 2015, after his contract end date had been communicated. The court framed three issues: discrimination in payment, unfair termination, and entitlement to remedies. It held the discrimination claim failed because the grievant could not enjoy CBA rates while not a union member for most of his service. On termination, the court found that the grievant had signed all his contracts, and non-renewal of a fixed-term contract was not unfair termination. However, the last contract was terminable by one week's notice which the Respondent did not give; notice pay of Kshs. 7,579 (7/30 x Kshs. 32,481) was awarded as the only remedy. All other prayers were refused. The Respondent was ordered to pay costs of the suit.

Key legal issues

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01

Whether the grievant was discriminated against in his payment contrary to the CBA scale for clerical staff

Holding

The claim for discrimination in payment failed

Reasoning

The court traced the succession of contracts from 2011 to 2015, all signed by the grievant on temporary terms at agreed salaries. The grievant only joined the union in May 2015, having started work in 2011, so he could not have enjoyed unionisable CBA rates while a non-member. The contention of discriminatory underpayment therefore did not hold.

p. 3
02

Whether the non-renewal of the grievant's fixed-term contract amounted to unfair termination

Holding

Non-renewal of a fixed-term contract is not unfair termination; the only remedy was notice pay for the last contract

Reasoning

The court found the grievant served on several term contracts which he signed accepting their terms. The last contract was terminable by one week's notice, and the Respondent did not give the requisite notice. That breach was the only remediable aspect; the failure to renew the contract itself was not unfair termination.

p. 3

Legal principles established

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  • A fixed-term contract expires by effluxion of time and non-renewal does not constitute unfair termination
  • Failure to give the notice stipulated in a fixed-term contract is a breach attracting payment in lieu of notice
  • A non-unionisable contract employee cannot claim CBA rates of pay for periods when he was not a union member

Court orders

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  1. 1.The Respondent to pay the grievant 7/30 of one month's salary in lieu of notice, computed as 7/30 x Kshs.32,481 = Kshs. 7,579
  2. 2.The Respondent to pay the costs of the suit

Authorities

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Legislation

  • Employment ActSection 47(5)

Cases cited (5)

  • East African Portland Cement Co. Ltd v Kenya Chemical & Allied Workers Union
    [2017] eKLR
  • Teresa Carlo Omondi v Transparency International Kenya
    [2017] eKLR
  • Margaret A. Ochieng v National Water & Pipeline Corporation
    [2014] eKLR
  • Rajab Barasa & 4 Others v Kenya Meat Commission
    [2016] eKLR
  • Stephen Kitheka v Kevita International Company Limited
    [2018] eKLR
Jurisdiction invoked
Employment and labour relations jurisdiction of the Employment and Labour Relations Court (grievance referred by the Claimant union on behalf of the grievant)

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, "Banking, Insurance & Finance Union (Kenya) v KCB Bank (Kenya) Limited [2019] KEELRC 327 (KLR)", Case Analysis (2019). Cause No 2043 of 2016. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/327/eng@2019-10-28

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