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ELRCPartially AllowedCause No. 305 (N) of 2009· [2019] KEELRC 2533 (KLR)

Kenya Union of Entertainment & 2 others v Film Corporation of Kenya [2019] KEELRC 2533 (KLR)

Employment and Labour Relations Court
29 January 2019
3,236 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~13 min to read original · ~4 min brief

The bottom line

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What this practically means

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Executive summary

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The Claimants, the Kenya Union of Entertainment and Music Industry and its former member Antony G. Warutere, claimed terminal benefits of Kshs.356,869 for the 2nd Claimant who voluntarily retired in January 2009 under Clause 35 of CBA No. 265 of 2008, plus interest from January 2008, protection of terminal benefits from deductions, and costs. The Respondent opposed the claim, contending that the CBA was unlawfully executed and never implemented, that the benefits were wrongly computed, that union dues were stopped because the union's Secretary General had directed dues into a personal account, and it counterclaimed for damages for loss of business with a set-off. The Respondent also argued that claims relating to the CBA were res judicata following the dismissal of ELRC No. 371 (N) of 2009. The court framed three issues: the binding effect of the CBA, the Claimants' entitlement to relief, and the Respondent's entitlement on its counter-claim. It held that the duly executed and registered CBA was binding under section 59 of the Labour Relations Act, its registration never having been challenged, and that the suit was not res judicata because Cause 371 (N) of 2009 was dismissed for want of prosecution while this cause was expressly allowed to proceed. The court awarded the 2nd Claimant Kshs.345,279.18 for salary underpayment (Kshs.139,992), house allowance underpayment (Kshs.48,995.52) and service gratuity (Kshs.156,291.66), but refused payment in lieu of notice since he voluntarily retired, and refused interest from January 2008 since the CBA only took effect upon registration on 22nd December 2008. The Respondent's counter-claim and set-off were dismissed as unproved, as were the union's prayers. The Respondent was ordered to pay the 2nd Claimant's costs.

Key legal issues

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01

Whether CBA No. 265 of 2008 is binding on the parties

Holding

The CBA is binding as it was duly executed and registered, and its registration was never challenged or set aside; the Respondent failed to prove lack of authority of its signatory.

Reasoning

The Claimants produced a duly executed CBA and a letter of 22nd December 2008 declaring it registered. Under section 59(5) of the Labour Relations Act, a collective agreement becomes enforceable upon registration by the Industrial Court and effective from the date agreed. Relying on KUCFAW v Kenya National Library Service and TSC v KNUT, the court held a registered CBA binds all parties and is incorporated into individual employment contracts. The Respondent's assertion of unlawful execution failed for want of proof, and the registration was never set aside.

p. 4
02

Whether the claim is res judicata following dismissal of ELRC No. 371 (N) of 2009

Holding

Not res judicata because Cause 371 (N) of 2009 was dismissed for want of prosecution while this suit was expressly allowed to proceed.

Reasoning

The Respondent argued that claims relating to the CBA brought after the dismissal of ELRC No. 371 (N) of 2009 were res judicata, citing Kamunye v Pioneer General Assurance. The court noted prior orders of Nduma J. of 24th July 2017 dismissing 371 (N) of 2009 for want of prosecution while expressly directing that Cause 305 (N) of 2009 proceed to hearing. A dismissal for want of prosecution is not a determination on the merits, so the doctrine of res judicata did not bar the present claim.

p. 4
03

Entitlement of the 2nd Claimant to terminal benefits under the CBA

Holding

The 2nd Claimant was entitled to salary underpayment, house allowance underpayment and service gratuity totalling Kshs.345,279.18, but not payment in lieu of notice or interest from January 2008.

Reasoning

Because the CBA was registered on 22nd December 2008 and the 2nd Claimant retired in January 2009, he was entitled to benefits under the CBA for 2008. His basic salary was computed at Kshs.15,500 (with a long-service increment for 10 years), with two 10% general increments, yielding Kshs.18,755. Underpayment of salary (Kshs.139,992), house allowance at 35% of basic (Kshs.48,995.52) and service gratuity at 25 days per completed year over 10 years (Kshs.156,291.66) were awarded. Payment in lieu of notice and interest from January 2008 were refused.

p. 6
04

Whether the Respondent was entitled to its counter-claim and set-off

Holding

The counter-claim and set-off failed as they were not proved.

Reasoning

The Respondent sought special damages for lost revenue, general damages for loss of business and a set-off against dues owed to the Claimants. The court found that these reliefs were not proved; damages must be specifically pleaded and proved, and the Respondent adduced no sufficient evidence. The counter-claim was accordingly dismissed in its entirety.

p. 4
05

Responsibility for unremitted union dues

Holding

The Respondent was liable to remit union dues it had deducted from the 2nd Claimant's payslip.

Reasoning

Prayer 3 was granted because the 2nd Claimant's payslips showed that Kshs.300.00 in union dues was deducted from his salary, implying an obligation on the Respondent to remit those dues to the union. The Respondent's assertion that it directed employees to remit dues personally was not supported by any evidence, and its allegation regarding instructions to pay dues into the Secretary General's personal account was not substantiated.

p. 4

Legal principles established

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  • A registered collective agreement becomes enforceable and binding upon all parties to it, and is incorporated into the contracts of employment of every employee covered by it, including members who have since resigned.
  • A registered CBA continues to bind an employer and employees who were parties at commencement, including members who resigned from the union.
  • Upon registration a CBA becomes the primary document of reference between the parties for its duration.
  • A suit dismissed for want of prosecution does not render subsequent claims res judicata.

Court orders

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  1. 1.Award of Kshs.345,279.18 to the 2nd claimant Antony Warutere for salary underpayment, house allowance underpayment and service gratuity
  2. 2.Dismissal of the Respondent's counterclaim and set-off
  3. 3.The respondent shall pay the 2nd claimant his costs of the suit
  4. 4.Dismissal of the 1st claimant's (the union's) prayers as not prosecuted or proved
  5. 5.Refusal of payment in lieu of notice
  6. 6.Refusal of interest on terminal benefits
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over trade dispute and CBA claims (Labour Relations 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, "Kenya Union of Entertainment & 2 others v Film Corporation of Kenya [2019] KEELRC 2533 (KLR)", Case Analysis (2019). Cause No. 305 (N) of 2009. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/2533/eng@2019-01-29

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