Kenya Union of Domestic, Hotels, Education Hospitals and Allied Workers v Nanyuki Cottege Hospital (Cause E039 of 2022) [2023] KEELRC 1068 (KLR)
The bottom line
#A Nyeri employment court awarded workers a 5.5% yearly raise, small housing and travel allowance increases, and confirmed the CBA runs for two years.
What this practically means
#Executive summary
#Key legal issues
#Wage increment
Claimant awarded 5.5% per year for two years, following the CPMU economic report
The court applied the Kenya Tea Growers factors - productivity, cost of living and ability to pay. The CPMU report found CPI increases of 1.02% and 9.93% over the two years (total 10.95%), minimal surpluses in 2020 and 2021, and no wage disparity. Absent contrary evidence, the court found the CPMU's opinion of 11% compensation objective and adopted 5.5% per year.
House allowance
Claimant awarded Kshs 413 per month increase per CPMU application of wage guideline No 2
Wage guideline No 2 provides that half of the permissible inflation compensation be allowed for housing. Half of 11% is 5.5%, translating to Kshs 413 per month for each of the 54 unionisable staff, an added annual burden of Kshs 267,624.00.
Leave travelling allowance
Claimant awarded the Kshs 500 increase to Kshs 8,500
The Kshs 8,000 figure was agreed in 2018 and travel costs had increased tremendously over the two years of the existing CBA. The increment costs only Kshs 27,000 per year for 54 unionisable staff, a modest burden the employer can absorb.
Employer's ability to pay
Respondent held able to afford the awarded increments
Total added financial burden of the three awards is approximately Kshs 2,579,248 over two years, against net profits of Kshs 3,334,570 (2020) and Kshs 2,914,614 (2021), with no contrary evidence from the respondent.
CBA duration
CBA limited to 2 years effective May 1, 2021, with parties encouraged to negotiate future CBAs on 3-4 year cycles
The court agreed with the respondent that 2-year cycles keep parties in continuous negotiation, but confined itself to the 2-year period covered by the CPMU report, recommending longer cycles like the civil service going forward.
Legal principles established
#- Wage increment determinations depend on productivity, cost of living (inflation) and the employer's ability to pay
Court orders
#- 1.Wage increment of 5.5% in the first year effective May 1, 2021 and 5.5% in the second year effective May 1, 2022 (clause 3 of proposed CBA).
- 2.Increment on leave travelling allowance from Kshs 8,000.00 to Kshs 8,500.00 per annum (clause 7).
- 3.Increase of Kshs 413 per month on house allowance, raising monthly house allowance to Kshs 7,913.00 in the first year and Kshs 8,326.00 in the second year (clause 18).
- 4.Duration of the CBA shall be 2 years effective May 1, 2021 (clause 28).
- 5.Each party to meet its own costs of the suit.
- 6.Parties directed to conclude the CBA forthwith.
- Jurisdiction invoked
- Original jurisdiction of the Employment and Labour Relations Court over a collective bargaining dispute referred after failed conciliation; no specific provision cited in the judgment
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kenya Union of Domestic, Hotels, Education Hospitals and Allied Workers v Nanyuki Cottege Hospital (Cause E039 of 2022) [2023] KEELRC 1068 (KLR)", Case Analysis (2023). Not stated in the judgment as provided. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/1068/eng@2023-04-27
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.