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ELRCDismissedMemorandum of Claim dated 17th August 2021 (ELRC, Kisumu)· [2024] KEELRC 152 (KLR)

Kenya Engineering Workers Union v Farm Engineering Industries Limited (Cause E060 of 2021) [2024] KEELRC 152 (KLR)

Employment and Labour Relations Court
8 February 2024
CBChristine N. Baari
1,676 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~7 min to read original · ~4 min brief

The bottom line

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A Kenyan court dismissed a union's challenge to worker outsourcing because the union failed to prove the arrangement breached their collective bargaining agreement.

What this practically means

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Executive summary

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In a Memorandum of Claim dated 17th August 2021, the Claimant union sought declarations that the Respondent's outsourcing of core business was unlawful and null and void, an injunction against outsourcing labour for core business, adoption of the Conciliator's recommendations, and payment of all unionisable employees in line with the parties' CBA. The Claimant alleged that the Respondent rendered its members redundant or dismissed them and replaced them with underpaid outsourced workers, reducing its membership from about 30 to 18, without consultation. The Respondent denied outsourcing core business, asserted the CBA contains no prohibition on outsourcing, attributed terminations to individual misconduct or a lawful redundancy process overseen and approved by the Conciliator, and urged dismissal. The court framed two issues: whether the outsourcing violated the CBA, and whether the Claimant deserved the reliefs. Applying the parameters in Wrigley Company (East Africa) Limited v Attorney General and Kenya Airways Limited v Aviation & Allied Workers Union, the court observed that employers are not ordinarily expected to outsource core functions and that outsourcing must not be used to escape obligations or discriminate. However, the Claimant led no evidence on the number of outsourced employees, their duties or pay, and the Respondent continued remitting union dues. The court noted that generalized outsourcing (triangular employment) is currently unregulated but that nothing bars a union from recruiting outsourced workers within its representation area. It held the outsourcing did not violate the CBA, dismissed all reliefs, and ordered each party to bear its own costs in the interest of promoting social partnership.

Key legal issues

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01

Whether outsourcing of employees by the Respondent violates the CBA with the Claimant

Holding

No violation of the CBA was established; the outsourcing did not breach the agreement.

Reasoning

The court applied parameters from Wrigley and Kenya Airways: outsourcing core functions or using outsourcing to escape obligations or discriminate may be unlawful. But the Respondent admitted only outsourcing some services; no evidence showed core functions were outsourced, nor how many workers were outsourced or what they were paid. The union could recruit outsourced workers, and union dues were still being remitted.

p. 4
02

Whether the Claimant deserves the reliefs sought

Holding

Reliefs fail as they were premised on a violation of the CBA which was not found.

Reasoning

Since the court found no CBA violation, the consequential prayers - declarations, injunction against outsourcing, adoption of the Conciliator's recommendations and payment of all unionisable employees per the CBA - could not stand, and the suit was dismissed with each party bearing own costs.

p. 4

Legal principles established

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  • As the law stands, triangular employment in the nature of a generalized outsourcing agency is unregulated, with potential to deny workers the right to collective bargaining with their de facto employer.
  • Nothing bars a union from recruiting members from outsourced employees within its area of representation.
  • A claimant alleging unlawful outsourcing bears the evidential burden of proving the nature of outsourced work and discriminatory pay.

Court orders

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  1. 1.The claim and all reliefs sought are dismissed
  2. 2.Parties shall bear their own costs of the suit
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over the employment dispute (Labour Relations Act framework; CBA registered as CA No. 215 of 2016)

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 Limited (Cause E060 of 2021) [2024] KEELRC 152 (KLR)", Case Analysis (2024). Memorandum of Claim dated 17th August 2021 (ELRC, Kisumu). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/152/eng@2024-02-08

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