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ELRCDismissedNot stated in judgment (Statement of Claim dated 15th April 2019)· [2022] KEELRC 159 (KLR)

Michael Lunani v Chemelil Sugar Company Limited [2022] KEELRC 159 (KLR)

Employment and Labour Relations Court
21 April 2022
CBChristine N. Baari
2,125 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Chemelil Sugar supervisors lost their Kshs.154 million discrimination claim in Kenya's Employment Court because they filed four years too late.

What this practically means

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Executive summary

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The Claimant, granted leave on 27th March 2019 to sue in a representative capacity for himself and 107 others, claimed that after promotion to supervisor (a non-unionisable junior management cadre) at Chemelil Sugar Company Limited, he and other supervisors suffered discrimination through salary disparities, non-payment of increments, allowances, overtime and unfavourable retirement packages, despite an SRC advisory and ministerial authority to implement a harmonized salary structure. He sought declarations of constitutional violation, payment of Kshs. 154,136,694.55, statutory dues, salary arrears and payment for extra hours worked. The Respondent defended the claim on the basis that the Claimants signed negotiated contracts, that financial incapacity (including closure of the factory for over a year) prevented implementation of the SRC advisory, and that the Claimants' terminal dues were paid at retirement. The Respondent cited authorities to argue that accepted contractual terms preclude discrimination claims and that wage questions require consideration of ability to pay. The court held that the SRC advisory was binding and that the ministerial authority confirmed the cost was within the 2014/2015 approved budget, so the failure to comply was neither founded nor justified, and the Kenya Tea Growers Association case on minimum wages was distinguishable. However, the benefit crystallized when the approvals were granted in 2014, and under Section 90 of the Employment Act the suit filed on 15th April 2019 was filed far beyond the three-year limitation period. The court dismissed the claim in its entirety and ordered each party to bear their own costs.

Key legal issues

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01

Whether the Claimants are entitled to the remedies sought

Holding

The claim was dismissed as statute-barred

Reasoning

The court found that the salary disparities existed and that the SRC advisory and ministerial authority to implement a harmonized salary structure were binding. The benefit crystallized when the approvals were granted between August and November 2014, within the 2014/2015 financial year. Under Section 90 of the Employment Act, employment claims must be filed within three years. The suit filed on 15th April 2019 was therefore filed out of time and statute-barred, notwithstanding any claim of continuing injury.

p. 3
02

Whether the Respondent's failure to implement the SRC advisory was justified by financial incapacity

Holding

The failure to comply was neither founded nor justified

Reasoning

The SRC advisory of 22nd August 2014 was binding, and the Ministry of Agriculture, Livestock and Fisheries granted authority to implement on 26th November 2014, confirming the cost was catered for in the 2014/2015 approved budget. The court questioned why the Respondent sought advice and authority if it lacked funds, and found the financial incapacity plea unconvincing. However, this finding did not save the claim from the limitation bar.

p. 3
03

Whether the Kenya Tea Growers Association case applied to the Claimants' claim

Holding

Distinguished

Reasoning

The Respondent relied on the Court of Appeal decision to argue that wage increment questions require consideration of productivity, cost of living and ability to pay. The court held that the case related only to minimum wages, whereas the Claimants were not seeking to enforce minimum wages but annual salary increments already approved for payment by the relevant entities, making the authority distinguishable.

p. 3

Legal principles established

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  • An advisory issued by the Salaries and Remuneration Commission is binding, not mere advice
  • Upon SRC approval and ministerial authority to implement a salary structure, the salary increments crystallize into an enforceable benefit and the cause of action accrues at that point for limitation purposes under Section 90 of the Employment Act

Court orders

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  1. 1.The Claimants' claim dated and filed on 15th April 2019 is dismissed in its entirety
  2. 2.Parties shall bear their own costs of the suit

Authorities

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Legislation

  • Constitution of Kenya, 2010Article 41
  • Employment Act, 2007Section 90
  • Limitation of Actions ActSection 4(1)

Cases cited (2)

  • David Ithau Wambua v Liberty Kenya Holdings Limited
    (2019) eKLR
  • Kenya Tea Growers Association v Kenya Plantations & Agricultural Workers Union
    (2018) eKLR
Jurisdiction invoked
Article 41 of the Constitution; Employment and Labour Relations Court jurisdiction over employment and labour relations claims

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, "Michael Lunani v Chemelil Sugar Company Limited [2022] KEELRC 159 (KLR)", Case Analysis (2022). Not stated in judgment (Statement of Claim dated 15th April 2019). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/159/eng@2022-04-21

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