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ELRCPartially AllowedNot stated in the judgment· [2019] KEELRC 2259 (KLR)

Francis Gitonga Murucha & 8 others v Chairman & Management Committee Muiru Farmers Co-op Society Limited [2019] KEELRC 2259 (KLR)

Employment and Labour Relations Court
7 February 2019
NMNzioki wa Makau
1,151 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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Nine employees of a coffee co-operative society - a factory manager, a second factory manager, a store keeper, a machine operator, three night watchmen, a junior clerk and a cashier - sued for unpaid salaries covering 14 to 16 months, together with house and medical allowances, annual increments, leave allowance, overtime, NSSF arrears, damages for financial embarrassment, costs and interest. The Respondent defended the claim on the basis that a slump in coffee production, low rainfall, disease, poor prices and the Government policy requiring 80% of auction proceeds to go to members left only 20% for operations, including salaries; it asserted the Claimants were aware of these challenges, that computations differed, and that the Claimants abandoned work on 15th January 2018 after a 14-day ultimatum, in breach of the CBA. The Claimants testified through the 1st Claimant that they had not abandoned work. The court held that the Claimants did abandon their employment after giving inadequate 14-day notice, so termination did not arise. However, the law does not permit an employer to withhold salaries for 13 or so months, and the internal 80/20 payment policy could not supersede the Employment Act. The court awarded each Claimant assessed salary arrears (including house allowance) ranging from Kshs. 215,687.60 to Kshs. 317,605.05, with interest at court rates from the date of judgment until payment in full. Claims for overtime and NSSF/NHIF arrears were rejected as misapprehended, and the 16-month allegation failed for want of records. No costs order appears on the face of the judgment.

Key legal issues

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01

Withholding of wages despite operational challenges

Holding

The Claimants were entitled to salaries for days worked notwithstanding their own breach in abandoning work

Reasoning

The court accepted the Respondent's evidence of financial hardship and the 80/20 policy, but held that such constraints could not justify withholding wages for 13 or more months. Section 18(2)(c) of the Employment Act was invoked by the Claimants on payment of wages, and the court affirmed that salaries are due for days worked regardless of the employer's cash-flow difficulties.

p. 2
02

Abandonment of employment

Holding

The Claimants abandoned their employment after giving inadequate 14-day notice, so termination did not arise

Reasoning

The court found the Claimants left their work stations after issuing a 14-day ultimatum. This notice was inadequate; they did not abide by the law in issuing notice to quit and did not follow the statutory process for a strike notice. Consequently the issue of termination does not arise, though the infraction did not extinguish their right to earned wages.

p. 2
03

Quantum of unpaid salaries

Holding

Only salary arrears of roughly one year, inclusive of house allowance, were awarded per the Respondent's computations

Reasoning

The court preferred the Respondent's computations, which conceded non-payment for roughly one year and included house allowance, over the Claimants' schedules covering a longer period. The Claimants, including the factory manager, cashier and junior clerk, bore the evidential onus of proving the 16 months they alleged but did not produce records. Overtime and statutory-deduction claims failed.

p. 2

Legal principles established

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  • Financial difficulty and any internal payment-ratio policy do not permit an employer to withhold wages lawfully earned

Court orders

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  1. 1.Payment to each Claimant of the assessed salary arrears: Francis Gitonga Murucha Kshs. 297,266.05; Jamlick Mbaka Nkuru Kshs. 303,866; Naftary Kirimi Njeru Kshs. 287,470.95; Japhet Mbaka Mboore Kshs. 270,739.30; Peter Murithi Kshs. 215,687.60; Japhet Ngai Kshs. 215,687.60; Kinyua Justain Kshs. 215,687.60; Julius Njagi Nandi Kshs. 272,797.10; Frankline Mutegi Kanga Kshs. 317,605.05
  2. 2.Interest on the sums at court rates from the date of judgment till payment in full

Authorities

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Legislation

  • Employment ActSection 18(2)(c)
Jurisdiction invoked
Employment and Labour Relations Court first-instance jurisdiction over employment claims (Employment Act)

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, "Francis Gitonga Murucha & 8 others v Chairman & Management Committee Muiru Farmers Co-op Society Limited [2019] KEELRC 2259 (KLR)", Case Analysis (2019). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/2259/eng@2019-02-07

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