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ELRCPartially AllowedMemorandum of Claim dated 28th January, 2021· [2022] KEELRC 545 (KLR)

Kenya Union of Commercial Food and Allied Workers v Murang’a Farmers Co-Operative Union [2022] KEELRC 545 (KLR)

Employment and Labour Relations Court
9 March 2022
995 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Employment Court ordered a coffee employer to pay two former workers over Kshs.9 million in terminal benefits in full because it proved no inability to pay.

What this practically means

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Executive summary

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The Claimant Union filed a Memorandum of Claim dated 28th January 2021 on behalf of two grievants, Bernard Kungu Maina and Ndungu Joseph Kangethe, alleging failure by the Respondent to pay their terminal benefits. The parties related through a registered Recognition Agreement and Collective Bargaining Agreement. The 1st grievant served 32 years until his services were terminated on grounds of restructuring effective 31st January 2020, with accumulated terminal benefits of Kshs.6,178,923.68, of which Kshs.1,304,528.80 was paid, leaving Kshs.4,874,394.88. The 2nd grievant served 40 years and 9 months before retirement, was paid Kshs.782,230.75 out of computed dues, leaving Kshs.4,534,331.54. The Respondent did not deny the claim but asserted that balances were agreed to be paid gradually over six years subject to the prevailing financial capacity of the Respondent, citing economic difficulty from the Covid-19 pandemic in the coffee sector. A conciliation process failed. The court framed two issues: whether the Respondent should be compelled to pay the balances, and who bears costs. Finding the figures undisputed, and noting the Respondent filed no written submissions and no evidence of inability to pay, the court allowed the claim. It ordered payment of the full balances to each grievant within sixty days, with interest at court rate from judgment until payment in full, and directed each party to bear their own costs.

Key legal issues

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01

Whether the Respondent should be compelled to pay the outstanding terminal benefits balances to the two grievants

Holding

Yes. The amounts were not in dispute and the Respondent produced no evidence of inability to pay, so the balances were ordered payable in full.

Reasoning

The Respondent admitted the debt but asserted that balances were agreed to be paid over six years subject to improved finances, citing Covid-19 economic difficulty. The court found the matter simple because the figures were undisputed, and noted the Respondent filed no written submissions and no evidence of financial disability one year after termination. It therefore found the Respondent should be compelled to pay the amounts owing in full.

p. 2
02

Who bears the costs of the case

Holding

Each party to bear their own costs.

Reasoning

Although the Claimant sought costs of the suit, the court in its final orders directed that each party bear their own costs of the claim, notwithstanding that the claim succeeded.

p. 2

Legal principles established

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  • An employer who does not dispute terminal benefits figures must adduce evidence of inability to pay to escape immediate liquidation of the debt.

Court orders

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  1. 1.Bernard Kungu Maina be paid an amount of Kshs.4,874,394.88 in full.
  2. 2.Ndungu Joseph Kangethe be paid an amount of Kshs.4,534,331.54 in full.
  3. 3.That the amounts owing be met within sixty (60) days of this judgment of the court.
  4. 4.That the amounts payable earn interest at courts rate from the date of judgment of court until payment in full.
  5. 5.That each party shall bear their costs of the claim.
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over a registered dispute on terminal benefits, the parties relating through a Recognition Agreement and Collective Bargaining Agreement registered in the court

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 Murang’a Farmers Co-Operative Union [2022] KEELRC 545 (KLR)", Case Analysis (2022). Memorandum of Claim dated 28th January, 2021. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/545/eng@2022-03-09

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