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ELRCPartially AllowedELRC Cause (Nairobi) - Memorandum of Claim filed May 31, 2017· [2023] KEELRC 688 (KLR)

Nyanyuki & 71 others v Polysack Limited (Cause 1013 of 2017) [2023] KEELRC 688 (KLR)

Employment and Labour Relations Court
16 March 2023
JGJacob Gakeri
2,607 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 Polysack Ltd to pay 72 former workers Kshs 2.47 million in salary arrears owed under a collective bargaining agreement, plus half the legal costs.

What this practically means

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Executive summary

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Seventy-two former employees of Polysack Ltd - machine operators, general workers, a mechanic and electricians - sued for salary arrears of Kshs 2,465,968.22 arising from a Collective Bargaining Agreement concluded on July 11, 2016 pursuant to a court order in ELRC Cause No 2280 of 2014 (Kenya Chemical & Allied Workers Union v Polysack Ltd), which awarded a 10% salary increment for three years backdated to August 1, 2012. The 2nd to 10th Claimants were retired on January 27, 2015 and the rest declared redundant, all paid terminal dues excluding the CBA salary arrears. Following a settlement agreement of March 31, 2017 in which the Respondent undertook to clear CBA arrears for 2012-2015, some employees were paid but the Claimants were not. The Respondent filed a response of bare denials but did not participate in the proceedings, did not attend the hearing of December 13, 2022 and filed no submissions. The court held that even in an undefended suit the Claimants bore the burden of proof, guided by Sections 107 and 109 of the Evidence Act and authorities of Maureen Onyango J and Abuodha J. It found sufficient documentary evidence - union correspondence, redundancy letters, the settlement agreement and the registered CBA - establishing the employment relationship and the debt, and noted the Respondent never denied owing the amounts claimed. Relying on Sections 17 and 18 of the Employment Act, 2007, the court found the Claimants entitled to the arrears and entered judgment for Kshs 2,465,968.22, awarding 50% of the costs. Interest, though prayed for, was not granted in the final orders. Judgment was delivered virtually at Nairobi on March 16, 2023.

Key legal issues

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01

Whether the Claimants proved entitlement to the salary arrears under the CBA despite the suit being undefended

Holding

Yes. The court found that on a balance of probabilities, supported by uncontroverted evidence and documentary records of engagement between the Respondent and the union, the Claimants were entitled to the salary arrears in accordance with the CBA.

Reasoning

The court applied the trite principle that even in an undefended suit the claimant must prove the claim, guided by Sections 107 and 109 of the Evidence Act. It found sufficient documentary evidence (union correspondence, redundancy letters, the settlement agreement of March 31, 2017, and the registered CBA with 10% increments effective August 1, 2012) disproving the Respondent's denial of employment and establishing the debt. The Respondent adduced no evidence and did not file submissions.

p. 6
02

Whether an employer may withhold wages earned under a contract of service

Holding

No. Section 17 of the Employment Act, 2007 obliges the employer to pay the entire amount of wages earned by or payable to an employee, and Section 18 deems wages due at the end of each month for employees engaged for more than a month.

Reasoning

The court invoked Sections 17 and 18 of the Employment Act, 2007, noting that non-compliance with Section 17(1)-(5) is a criminal offence attracting a fine of up to Kshs 100,000. It adopted Rika J's statement in Bernard Nyakina Nyanyuki & 71 others v Polysack Ltd that an employer is bound to pay the entire amount of salary earned when due.

p. 5

Legal principles established

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  • In an undefended claim, the claimant must still establish all the facts of the claim, including the employment relationship, on a balance of probabilities.
  • An employer is bound to pay the employee the entire amount of salary earned by, or payable to the employee, when such salary is due for payment (Section 17, Employment Act, 2007).

Court orders

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  1. 1.Judgment entered for the Claimants against the Respondent for the sum of Kshs 2,465,968.22
  2. 2.Claimants awarded 50% of the costs

Authorities

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Legislation

  • Employment ActSection 17(1); Section 17(10); Section 18(2)
  • Evidence ActSection 107; Section 109
  • Civil Procedure RulesOrder 21 Rule 1
  • Civil Procedure ActSection 1B
  • Constitution of Kenya, 2010Article 159(2)(d); Article 48

Cases cited (6)

  • Humphrey Munyithia Mutemi V Soluxe International Group Hotels
    (2020) eKLR
  • Monica Karimi Mutua V Al-Arafat Shopping Centre & another
    (2018) eKLR
  • Nicholus Kipkemoi Korir V Hatari Security Guards Ltd
    (2016) eKLR
  • Hezron Ziro V Three Ways Shipping Services Ltd
    (2018) eKLR
  • Bernard Nyakina Nyanyuki & 71 others V Polysack Ltd
    (2019)
  • Kenya Chemical & Allied Workers Union V Polysack Ltd (ELRC Cause No 2280 of 2014)
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under Article 162(2) of the Constitution (employment and labour relations dispute over salary arrears under a CBA and the Employment 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, "Nyanyuki & 71 others v Polysack Limited (Cause 1013 of 2017) [2023] KEELRC 688 (KLR)", Case Analysis (2023). ELRC Cause (Nairobi) - Memorandum of Claim filed May 31, 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/688/eng@2023-03-16

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