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ELRCPartially AllowedCause No. 1643 of 2013· [2019] KEELRC 466 (KLR)

Kenya Union of Commercial Food and Allied Workers v Sanpac Africa Limited [2019] KEELRC 466 (KLR)

Employment and Labour Relations Court of Kenya at Nairobi
11 October 2019
HWHellen S. Wasilwa
2,007 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~8 min to read original · ~4 min brief

The bottom line

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A Kenyan employer cannot convert workers from permanent to contract terms just because they resign from a union — the court awarded each employee 11 months' salary.

What this practically means

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Executive summary

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The Claimant union filed a Memorandum of Claim on 11 October 2013 alleging that while the parties were negotiating review of a Collective Agreement, the Respondent paid its 65 employees their October 2012 salary on condition that they signed a list revoking their union membership, declared them redundant, and re-engaged them on contractual terms. The union sought declarations that the redundancy and the resignation list were unlawful, re-engagement on permanent terms, remittance of union dues, and compensation of twelve months' gross wages per employee. The Respondent denied compulsion, contended the Recognition Agreement had been terminated on 5 November 2012, and asserted the employees remained in its employment on contract. Both parties called three witnesses; only the Claimant filed written submissions. The grievants testified they were forced to resign from the union and moved to contract terms without consultation, notice or tabulation of dues. The Respondent's witnesses maintained the resignations were voluntary. Holding that resignation from a union cannot justify converting permanent and pensionable employment to contractual terms without consultation, notice or due process, the court found the grievants were unfairly terminated. Applying section 10(5) of the Employment Act 2007, the court awarded each grievant 10 months' salary as compensation for unlawful termination and 1 month's salary in lieu of notice, to be calculated in an addendum to the judgment. The claim succeeded in part; the claimant's prayers for re-engagement, union dues orders and the full 12 months' compensation were not granted, and no costs order was stated.

Key legal issues

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01

Whether the conversion of the grievants from permanent and pensionable to contractual terms constituted unfair termination

Holding

Yes - the change amounted to termination without due process, as there was no consultation or notice and no fair disciplinary process

Reasoning

The court accepted that the grievants' union resignations were used as the basis for altering their permanent terms to contract terms. Applying section 10(5) of the Employment Act, any change to contractual matters requires consultation with the employee and written notice. The Respondent offered no consultation or notice and no fair process. The court therefore held the grievants were unfairly terminated and fell back on its remedial powers to award compensation.

p. 3
02

What compensation is appropriate for the unlawful termination

Holding

Each grievant awarded 10 months' salary as compensation plus 1 month's salary in lieu of notice

Reasoning

The claimant had sought 12 months' gross wages for each employee. The court, in its discretion, awarded 10 months' salary as compensation for the unlawful termination together with 1 month's salary in lieu of notice, to be calculated and set out in an addendum to the judgment.

p. 3

Legal principles established

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  • Resignation from a union cannot of itself justify converting an employee's permanent and pensionable terms to contractual terms; doing so without consultation or notice is unfair termination.
  • Where any matter stipulated in an employment contract changes, the employer must revise the contract in consultation with the employee and notify the employee in writing.

Court orders

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  1. 1.Judgment entered for the grievants against the Respondent for unlawful termination
  2. 2.Each grievant awarded 10 months' salary as compensation for the unlawful termination
  3. 3.Each grievant awarded 1 month's salary in lieu of notice
  4. 4.The awards to be calculated and included as an addendum to the judgment

Authorities

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Legislation

  • Employment Actsection 2
  • Employment Act 2007section 10(5)
  • Employment Actsection 40
  • Employment Actsection 41
  • Employment Actsection 49
  • Employment Actsection 50
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under Article 162(2) of the Constitution (court established as the ELRC hearing this trade dispute cause)

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 v Sanpac Africa Limited [2019] KEELRC 466 (KLR)", Case Analysis (2019). Cause No. 1643 of 2013. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/466/eng@2019-10-11

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