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ELRCDismissedNot stated in the judgment· [2023] KEELRC 1205 (KLR)

Omwenya v Sichangi Partners & Associates Network LLP (Cause E037 of 2021) [2023] KEELRC 1205 (KLR)

Employment and Labour Relations Court
18 May 2023
1,242 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 ruled that arbitration clauses in employment contracts cannot stop employees from suing directly at the ELRC.

What this practically means

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Executive summary

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This ruling of the Employment and Labour Relations Court at Mombasa (M. Mbarũ, J) determined a Notice of Preliminary Objection filed by the respondent, Sichangi Partners & Associates Network LLP, on June 3, 2021, in a claim by a former employee alleging constructive dismissal after being forced to resign on May 9, 2019. The respondent objected that the court lacked jurisdiction because clause 9 of the terms of engagement required good-faith negotiations and arbitration before suit, that proceedings violated section 6 of the Arbitration Act, and that the suit was premature and an abuse of process. The claimant countered that a preliminary objection must be a pure point of law, that he attempted settlement but was ignored (including an email of July 15, 2019), and that the respondent had submitted to jurisdiction by entering appearance and filing a Notice of Appointment. Following Wanguhu v Sustainet Group Limited, the court held that employment disputes fall within its original jurisdiction under Article 162(2)(a) of the Constitution read with Section 12 of the ELRC Act, which cannot be ousted by an arbitration clause or by section 6 of the Arbitration Act. The court distinguished commercial disputes, noted the respondent's late submission to jurisdiction, and applied Raila Odinga v IEBC on the limits of Article 159. The preliminary objections were found without merit and dismissed with costs to the claimant.

Key legal issues

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01

Whether an arbitration clause in an employment contract ousts the ELRC's jurisdiction

Holding

It does not; the ELRC's original jurisdiction under Article 162(2)(a) and Section 12 of the ELRC Act prevails over arbitration clauses in employment contracts.

Reasoning

The court relied on Wanguhu v Sustainet Group Limited, holding that employment contracts are subject to the ELRC's jurisdiction under Article 162(2)(a) read with Section 12 of the ELRC Act. Unlike commercial disputes governed by Articles of Association, employment disputes fall within the court's original jurisdiction, which clause 9 and Section 6 of the Arbitration Act cannot oust. The court distinguished commercial arbitration contexts from employment relationships.

p. 3
02

Whether a stay under section 6 of the Arbitration Act was available

Holding

No; the respondent had already entered appearance and filed a Notice of Appointment, so any request for stay came too late, and good-faith efforts at settlement had been attempted and ignored.

Reasoning

The claimant submitted, citing Gourmet Meat Producers, that a stay must be requested no later than filing a Memorandum of Appearance. The respondent had entered appearance on June 3, 2021, submitting to jurisdiction. The claimant also demonstrated good-faith settlement attempts, including a July 15, 2019 email to which the respondent did not respond, satisfying the spirit of clause 9.

p. 2
03

The relationship between Article 159 of the Constitution, arbitration, and procedural requirements

Holding

Article 159 promotes alternative dispute resolution but does not oust litigants' obligation to comply with procedural imperatives, and courts should not apply undue attention to procedure at the expense of substantive justice.

Reasoning

Citing Raila Odinga v IEBC & 3 Others, the court held that Article 159(2)(d) means courts should not overemphasize procedure at the expense of substantive justice, and Article 159 was never meant to oust procedural compliance. The objective of section 6 of the Arbitration Act is to facilitate, not subvert, constitutional ADR objectives, and informal shop-floor settlement efforts in employment disputes satisfy the ADR spirit.

p. 3

Legal principles established

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  • The ELRC retains original jurisdiction over employment disputes notwithstanding an arbitration clause in an employment contract; such jurisdiction cannot be ousted by clause 9 of the contract or section 6 of the Arbitration Act.
  • A preliminary objection must be a pure point of law; a clause requiring evidence is not such.

Court orders

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  1. 1.The respondent's Notice of Preliminary Objections filed on June 3, 2021 is found without merit and dismissed with costs to the claimant

Authorities

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Legislation

  • Constitution of Kenya, 2010Article 159(2)(d); Article 162(2)(a)
  • Arbitration ActSections 6 and 9
  • Employment and Labour Relations Court Act, 2011Section 12

Cases cited (6)

  • Chania Gardens Limited v Gilbi Construction Company Limited & Another
    [2015] eKLR
  • Mary Joy Wangui Gitau v Umberto Paoletti & others
    [2021] eKLR
  • Gourmet Meat Producers & Importers Ltd v Paul Lainan Nkina
    [2021] eKLR
  • Wanguhu v Sustainet Group Limited (Cause E085 of 2021)
    [2022] KEELRC 1226 (KLR)
  • Meshack Kibunja Kaburi & 3 others v Kirubi Kamau & 5 others; Central Highlands Tea Company Limited (Interested Party)
    [2021] eKLR
  • Raila Odinga v IEBC & 3 Others
Jurisdiction invoked
Article 162(2)(a) of the Constitution read with 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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Cite this brief

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Cite this brief

Caselaw, "Omwenya v Sichangi Partners & Associates Network LLP (Cause E037 of 2021) [2023] KEELRC 1205 (KLR)", Case Analysis (2023). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/1205/eng@2023-05-18

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