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ELRCDismissedMotion dated 23 March 2021 in Employment Cause (judgment of 3 February 2021)· [2022] KEELRC 1442 (KLR)

Kenya Engineering Workers Union v Farm Engineering Industries Ltd (Cause 32 of 2019) [2022] KEELRC 1442 (KLR)

Employment and Labour Relations Court
22 June 2022
RSRadido Stephen
1,683 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kisumu court refused to pause payment of employee wage arrears because the employer showed no real loss and offered no security.

What this practically means

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Executive summary

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Farm Engineering Industries Ltd, aggrieved by a judgment of 3 February 2021 ordering it to sign a collective bargaining agreement with the Kenya Engineering Workers Union incorporating a 12% general wage increment effective 1 August 2017, moved the Court by a Motion dated 23 March 2021 seeking stay of execution of the judgment and decree pending appeal. The Respondent argued it was unaware of the judgment date, that it had lodged a Notice of Appeal, that implementation would prejudice it financially given COVID-19 hardships, and that its appeal was arguable. The Union opposed, deposing that the judgment date was taken by consent, that the Notice of Appeal was filed late, that the wage arrears were pre-COVID-19, and that the Central Planning and Monitoring Unit had recommended a higher increment. The Court found the application was not brought after inordinate delay but held that the Respondent had to demonstrate substantial loss and readiness to provide security. Relying on Kenya Shell Ltd v Kibiru and Nduhiu Gitahi v Anna Wambui Warugongo, the Court found that the decree concerned wage arrears for a period already three years past, that staying it would cause more substantial loss to the employees than the employer, and that the Respondent had not disclosed readiness to offer security. The Court also rejected the contention that judgment was rendered before certification, noting the Respondent's non-compliance with directions and its counsel's presence when judgment was reserved. The Motion was dismissed with costs to the Union.

Key legal issues

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01

Inordinate delay

Holding

The interval between judgment (3 February 2021) and the Motion (6 April 2021) did not amount to inordinate delay

Reasoning

The Notice of Appeal was lodged on 16 February 2021 within the prescribed time, and the Motion followed on 6 April 2021. The Court found this interval reasonable and did not consider it inordinate delay, moving on to consider substantial loss and security.

p. 2
02

Substantial loss and security for due performance

Holding

Stay declined because the decree concerned past wage arrears, employees would suffer greater loss, and no security was offered

Reasoning

Applying Kenya Shell Ltd v Kibiru, the applicant had to demonstrate substantial loss and readiness to offer security. The Respondent asserted reduced profits and COVID-19 hardship, but the arrears related to wages for a period already past, and the Respondent had snubbed earlier opportunities to place its financial position before the Court. It also failed to disclose willingness to offer security.

p. 3
03

Assertion that judgment was rendered before certification for hearing

Holding

Rejected; the record showed multiple directions and an advocate appeared when judgment date was reserved

Reasoning

The Court had on 17 September 2019 and 16 December 2019 directed the Respondent to file documents, which it failed to do, and on 12 November 2020 gave explicit directions reserving judgment to 3 February 2021, with counsel Mr Omwenga present. The claim that the Cause was not certified ready was therefore false.

p. 4

Legal principles established

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  • Substantial loss is the cornerstone of an application for stay pending appeal and must be evidenced by the applicant
  • Security for due performance of a decree may take many forms provided it adequately protects the opposite party
  • A party cannot, through a stay application, introduce arguments it should have raised before judgment

Court orders

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  1. 1.The Motion dated 23 March 2021 is dismissed with costs to the Union

Authorities

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Legislation

  • Civil Procedure RulesOrder XLI Rule 4

Cases cited (2)

  • Kenya Shell Ltd v Kibiru & Ar
    (1986) KLR, 410
  • Nduhiu Gitahi and Ar v Anna Wambui Warugongo
    (1988) 2 KAR 621
Jurisdiction invoked
Rule 4(4) of the Civil Procedure Rules / stay of execution pending appeal under Employment and Labour Relations Court (Procedures) Rules

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 Engineering Workers Union v Farm Engineering Industries Ltd (Cause 32 of 2019) [2022] KEELRC 1442 (KLR)", Case Analysis (2022). Motion dated 23 March 2021 in Employment Cause (judgment of 3 February 2021). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/1442/eng@2022-06-22

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