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ELRCPartially AllowedPetition No E003 of 2022· [2022] KEELRC 248 (KLR)

Consumers Federation of Kenya (COFEK) suing through its officials namely Stephen Mutoro, Ephraim Kanake and Henry Ochieng v National Social Security Fund Board of Trustees & another; Cabinet Secretary, Ministry of Labour and Social Protection (Interested Party) [2022] KEELRC 248 (KLR)

Employment and Labour Relations Court
13 April 2022
JGJACOB GAKERI
8,688 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~35 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court ruled that NSSF cannot approve its own HR rules or hire general managers without Public Service Commission approval.

What this practically means

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Executive summary

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Consumer Federation of Kenya petitioned the Employment and Labour Relations Court challenging the composition of the NSSF Board of Trustees, NSSF's new human resource instruments, and the advertisement for General Managers' positions. The Petitioner argued that NSSF lacked power to prescribe or approve human resource instruments, which required Public Service Commission (PSC) approval under Article 234 of the Constitution and the PSC Act, and that the process lacked public participation, quorum and budgetary provision. The Respondents maintained that under the State Corporations Act, human resource instruments for state corporations are developed by boards and approved by the State Corporations Advisory Committee (SCAC), and that the PSC has no role in state corporations. The court found the Petitioner had standing under Articles 22 and 258 and that the petition was public interest litigation. It rejected the claim that the NSSF Chairperson was in office illegally since the Katiba Institute judgment was stayed by the Court of Appeal. The court held that state corporation employees are public officers and that Article 234 prevails over the State Corporations Act under Section 7 of the Sixth Schedule; the PSC is the only body with constitutional authority to approve such instruments. The court declared that NSSF failed to uphold the rule of law, that the human resource instruments are ineffectual until PSC approval, and that the General Managers' recruitment shall remain in abeyance pending PSC approval, with NSSF to present the instruments to the PSC within 21 days. However, the injunctions and the order on career progression were declined for want of evidence of irreparable injury and factual foundation. Each party was ordered to bear its own costs.

Key legal issues

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01

Standing of the Petitioner

Holding

Petitioner has standing under Articles 22 and 258 as a registered society acting in the public interest

Reasoning

Article 258 grants every person standing, and Article 260 includes associations. The petition raises public interest issues concerning rule of law and the mandate of the PSC and SCAC, and the dispute touches employment and labour relations within the ELRC's jurisdiction, constitutional violations being ancillary and incidental.

p. 8
02

Legality of the NSSF Chairperson's appointment

Holding

Allegation fails because the quashing judgment was stayed by the Court of Appeal

Reasoning

The Katiba Institute judgment quashing the Gazette Notices was delivered on 27 May 2021, but the Court of Appeal granted a stay of execution on 23 September 2021, so the appointments remained effective.

p. 7
03

Mandate to prescribe human resource instruments

Holding

NSSF Board could originate the instruments but only the PSC can approve them

Reasoning

Article 234 vests PSC with functions over the public service, state corporation employees being public officers. Section 7 of the Sixth Schedule makes the Constitution prevail over the State Corporations Act, and the PSC Act applies to all public bodies. The instruments were never submitted to the PSC and are inoperable.

p. 12
04

Public participation, quorum and budget

Holding

Petitioner led no evidence on absence of participation or lack of quorum; budgetary allocation was proven

Reasoning

No evidence was led on who did not participate or which meeting lacked quorum; the Respondent showed board quorum under Section 11(2) of the NSSF Act and a rationalised budget of Kshs. 14,402,750,000 approved for 2021/2022.

p. 12

Legal principles established

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  • The Public Service Commission has the constitutional authority to approve human resource instruments of state corporations, Article 234 prevailing over the State Corporations Act
  • Employees of state corporations are public officers within the public service
  • Where pre-existing law conflicts with a constitutional assignment of responsibility, the Constitution prevails under Section 7 of the Sixth Schedule

Court orders

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  1. 1.Declaration that the 1st Respondent did not uphold the rule of law and the Constitution
  2. 2.Declaration that the petition is public interest litigation
  3. 3.Declaration that the 1st Respondent had no power to approve its human resource policies and guidelines; the instruments are ineffectual until approved by the Public Service Commission
  4. 4.Recruitment of general managers advertised on 23rd December 2021 to remain in abeyance until the human resource instruments are approved by the Public Service Commission
  5. 5.The 1st Respondent to present draft human resource instruments to the Public Service Commission within 21 days for review and approval with or without modifications
  6. 6.Each party to bear own costs

Authorities

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Legislation

  • Constitution of Kenya, 2010Articles 1, 2, 3, 4, 10, 21, 22, 23, 41, 48, 73, 159, 162(2)(a), 165, 232, 233, 234, 258, 260; Section 7 of the Sixth Schedule
  • Employment and Labour Relations Court ActSections 3 (preamble), 12, 12(2)
  • NSSF Act, 2013Sections 5(1), 5(2), 6, 10(1), 10(2), 10(3)(b), 11(2)
  • State Corporations Act, Cap 446Sections 5(1), 5(3), 27(1), 27(2)
  • Public Service Commission Act, No. 10 of 2017Sections 2, 3, 31, 55
  • Public Finance Management ActSections 68(1)(a), 2(j)
  • Civil Procedure Act (Chapter 21)Section 1B
  • Civil Procedure RulesOrder 21 Rule 1
  • Code of Governance for State Corporations (Mwongozo)General

Cases cited (24)

  • Katiba Institute & another v Attorney General & another
    [2020] eKLR
  • Chemilil Sugar Company Limited & 2 others v Kenya Union of Sugar Plantation and Allied Workers
    [2014] eKLR
  • Kenya Union of Commercial, Food and Allied Workers v Salaries and Remuneration Commission & 2 others
    [2015] eKLR
  • Anarita Karimi Njeru v Republic (No. 1)
    [1979] 1 KLR 154
  • Giella v Cassman Brown
    [1973] E.A 358
  • Gatirau Peter Munya v Dickson Mwenda Kithinji & 2 others
    [2014] eKLR
  • Daniel N. Mugendi v Kenyatta University & others
    [2013] eKLR
  • National Union of Water & Sewerage Employees v Mathira Water and Sanitation Company Limited & 2 Others
    [2013] eKLR
  • Fredrick Otieno Outa v Jared Odoyo Okello & 4 others
    [2014] eKLR
  • Kenya Union of Domestic, Hotels, Education and Allied Workers (Kudheiha Workers) v Salaries and Renumeration Commission
    [2014] eKLR
  • Mumo Matemu v Trusted Society of Human Rights Alliance & 5 others
    [2013] eKLR
  • Humphrey Makokha Nyongesa & another v Communications Authority of Kenya & 2 others
    [2018] eKLR
  • Communication Workers Union & another v Communication Authority of Kenya
    [2015] eKLR
  • Stek Cosmetics Limited v Family Bank Limited & another
    [2020] eKLR
  • Mrao Ltd v First American Bank of Kenya Ltd & 2 others
    [2003] eKLR
  • Nguruman Limited v Jan Bonde Nielsen & 2 others
    [2014] eKLR
  • Nken v Holder
    556 U.S. 418 [2009]
  • Republic v Commissioner of Customs Services Ex-Parte Africa K-Link International Limited
    [2012] eKLR
  • Manyara Muchui Anthony v Communications Authority of Kenya & 3 others
    [2022] eKLR
  • Okiya Omtatah Okoiti v Head of Public Service & 5 others
    [2018] eKLR
  • Kiambu County Tenants Welfare Association v Attorney General & another
    [2017] eKLR
  • Attorney General v Katiba Institute & 2 others
    Nairobi Civil Application E184 of 2021
  • Sumayya Athmani Hassan v Paul Masinde Simidi & another
    [2019] eKLR
  • Public Service Commission & 4 others v Cheruiyot & 32 others
    Civil Appeal 119 & 139 of 2017 (Consolidated) [2022] KECA 15 (KLR)
Jurisdiction invoked
Article 162(2)(a) of the Constitution and Section 12 of the Employment and Labour Relations Court Act, 2011

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (4)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Consumers Federation of Kenya (COFEK) suing through its officials namely Stephen Mutoro, Ephraim Kanake and Henry Ochieng v National Social Security Fund Board of Trustees & another; Cabinet Secretary, Ministry of Labour and Social Protection (Interested Party) [2022] KEELRC 248 (KLR)", Case Analysis (2022). Petition No E003 of 2022. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/248/eng@2022-04-13

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