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ELRCDismissedNot stated in the judgment as provided· [2024] KEELRC 527 (KLR)

Kihu v Optisafe (K) Ltd (Employment and Labour Relations Cause E201 of 2021) [2024] KEELRC 527 (KLR)

Employment and Labour Relations Court
7 March 2024
2,181 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~9 min to read original · ~4 min brief

The bottom line

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A Kenyan court refused to enforce a foreign employment contract that skipped mandatory legal formalities, and a signed settlement voucher sealed the worker's fate.

What this practically means

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Executive summary

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The Claimant, engaged as a Health and Safety Supervisor by contract dated 18th December 2019 to work on the Respondent's Water Recovery Project in Benin City, Nigeria at a salary of Ksh. 230,000.00, sued for unpaid salary for December 2019, 1st-10th January 2020 and April-June 2020, and for a Certificate of Service. The Respondent admitted the contract but contended that all dues to end of March 2020 were paid, that the project and contract were thereafter frustrated by the Covid-19 pandemic, and that upon repatriation the Claimant accepted Ksh. 26,785.00 under a Deed of Discharge dated 25th August 2020 in full and final settlement. The court framed three issues: compliance of the contract with the law, frustration, and the effect of the discharge voucher. It found the contract was a foreign contract of service within section 83 of the Employment Act which, not being in the prescribed form and not attested by a labour officer, was illegal and unenforceable; applying Kenya Airways v Satwant Singh Flora, the Claimant who knowingly participated in the illegality could not enforce it. In the alternative, the contract was frustrated by the pandemic, frustration being available even absent a force majeure clause. Further, the discharge voucher bound the parties, and the Claimant's bare allegation of coercion, lacking particulars and proof to the heightened standard in Patel v MJC, failed. The suit was dismissed with no order as to costs.

Key legal issues

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01

Compliance of foreign contracts of service with section 83 of the Employment Act

Holding

The contract was a foreign contract of service concluded in Kenya but performed in Nigeria; non-compliance with section 83 rendered it illegal and unenforceable

Reasoning

Section 83 of the Employment Act mandatorily requires foreign contracts of service to be in the prescribed form, signed by the parties, and attested by a labour officer. The contract between the parties contained none of the prescribed provisions (transport, death/desertion procedures, repatriation) and was never attested. Having consciously participated in the unlawful arrangement, the Claimant could not invoke the court's aid to enforce it, per the ex turpi causa principle in Kenya Airways Ltd v Satwant Singh Flora.

p. 3
02

Whether the contract was frustrated by the Covid-19 pandemic

Holding

Yes - the project shutdown and closure of Nigerian airspace frustrated the contract, and the absence of a force majeure clause does not preclude the doctrine

Reasoning

The Respondent's project in Nigeria was shut down at the close of March 2020 as a Covid-19 containment measure, confirmed by the Claimant in cross-examination as rendering her work impossible. The court held that frustration can operate regardless of whether the contract expressly contemplates force majeure, so the Claimant's objection that no force majeure clause existed was untenable.

p. 4
03

The legal effect of the Deed of Discharge dated 25th August 2020

Holding

The discharge voucher bound the Claimant, releasing the Respondent from further claims; the allegation of coercion was not proved to the required standard

Reasoning

The Claimant acknowledged receipt of Ksh. 26,785.00 in full and final settlement and affirmed she had no further claims. Her assertion of coercion was a bare allegation lacking particulars and cogent evidence; per Patel v MJC, vitiating elements like coercion must be pleaded specifically and proved to a standard higher than balance of probabilities. Financial need to sign is not coercion.

p. 5

Legal principles established

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  • A foreign contract of service not concluded in the prescribed form and not attested by a labour officer is illegal and unenforceable
  • A party who knowingly participates in an illegal contract cannot ask the court to enforce it
  • Frustration can operate despite the absence of a force majeure clause in the contract
  • A discharge voucher binds the parties until set aside on grounds that would vitiate a contract, which must be proved to a standard higher than balance of probabilities

Court orders

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  1. 1.Dismissal of the Claimant's suit
  2. 2.No order as to costs

Authorities

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Legislation

  • Employment ActSection 83
  • Employment ActSchedule (prescribed format of foreign contract of service)
  • ELRC Procedure RulesRule 28(3)

Cases cited (4)

  • Kamurasi v Absa Bank Kenya PLC & another
    (Employment and Labour Relations Cause E612 of 2021) [2023] KEELRC 3229 (KLR)
  • Kenya Airways Limited vs. Satwant Singh Flora
    [2013] eKLR
  • Patel & another v MJC & another (Suing as the guardians of PJP)
    (Civil Appeal 182 of 2019) [2022] KECA 364 (KLR)
  • Barasa v Opibus Ltd
    (Cause E1008 of 2021) [2022] KEELRC 13119 (KLR)
Jurisdiction invoked
Original employment and labour relations jurisdiction of the ELRC under 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, "Kihu v Optisafe (K) Ltd (Employment and Labour Relations Cause E201 of 2021) [2024] KEELRC 527 (KLR)", Case Analysis (2024). Not stated in the judgment as provided. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/527/eng@2024-03-07

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