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ELRCOtherNot stated in judgment (statement of claim dated 13th October, 2022; Cause 2330 of 2018 referenced)· [2024] KEELRC 654 (KLR)

Banking Insurance and Finance Union v Consolidated Bank of Kenya Limited (Cause E728 of 2022) [2024] KEELRC 654 (KLR)

Employment and Labour Relations Court of Kenya
14 March 2024
AJAbuodha Nelson Jorum
3,740 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~15 min to read original · ~4 min brief

The bottom line

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A Kenyan employment court sent a union-versus-bank dispute back to their agreed internal process, confirming you must exhaust that process before suing.

What this practically means

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Executive summary

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A registered trade union (the Claimant) sued a bank, alleging that following a 2017/2018 dispute over terminated employees, the Respondent systematically pushed unionisable employees into 'management' positions, causing union membership to fall from 109 members to 4, without any resignation letters as required under sections 48(6), (7) and (8) of the Labour Relations Act. The Claimant sought declarations that the removal of employees from union membership by unilaterally stopping union dues remittance was unlawful and unconstitutional, an order for remittance of dues and agency fees under section 49, and adherence to the Recognition Agreement and CBA preamble. The Respondent, a member of the Kenya Bankers Association, denied wrongdoing, asserting its managerial right to promote employees under clause 17 of the Recognition Agreement and contending the claim was premature because the Claimant never exhausted the internal dispute resolution mechanisms under the Recognition Agreement. The matter was disposed of by written submissions by consent. The Court held the preliminary question of exhaustion had to be resolved first. Noting clauses 4, 18, 19 and 20 of the Recognition Agreement requiring grievances to pass through the Joint Negotiating Council and, failing settlement, referral to the Ministry of Labour, the Court found no evidence the Claimant had invoked these mechanisms. Relying on the exhaustion doctrine and BIFU v KCB and Speaker of National Assembly v Karume, the Court acknowledged the issues were sound and valid but directed the parties to process the dispute through the agreed internal mechanisms within 60 days, with a report to be filed for final orders.

Key legal issues

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01

Whether the claim was prematurely before the Court for failure to exhaust internal dispute resolution mechanisms

Holding

Yes. The parties agreed on pre-court dispute resolution under the Recognition Agreement, and the Claimant presented no evidence of invoking those mechanisms or referring the dispute to the Minister for Labour. The Court, though willing and able to determine the issues, directed the parties to exhaust the agreed mechanisms first.

Reasoning

The Court examined clauses 4, 18, 19 and 20 of the Recognition Agreement, which required grievances to go through the Joint Negotiating Council and, if unresolved, referral to the Ministry of Labour. The record showed no attempt by the Claimant to invoke these mechanisms or the statutory conciliation process under the Labour Relations Act. Relying on the exhaustion doctrine and BIFU v KCB, the Court held the parties must respect their agreed pre-court process, which should be concluded within 60 days and a report filed for final orders.

p. 7

Legal principles established

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  • The exhaustion principle is a fundamental principle of administrative law requiring disputes to be subjected to available dispute resolution mechanisms before being placed before a court
  • Where a clear procedure for redress is prescribed by the Constitution or an Act of Parliament, that procedure should be strictly followed

Court orders

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  1. 1.The parties are directed to subject their dispute to the agreed internal dispute resolution mechanisms before invoking the jurisdiction of the Court
  2. 2.The dispute to be processed in accordance with Clause 4 read together with clauses 18 to 19 of the Recognition Agreement, to be concluded within 60 days of the Judgment with a report thereon filed in Court for final orders
  3. 3.Matter set for mention on 3rd June, 2024 for purposes of recording final orders
Jurisdiction invoked
Jurisdiction of the Employment and Labour Relations Court invoked subject to exhaustion of internal dispute resolution mechanisms under the Recognition Agreement and the Labour Relations Act, 2007

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, "Banking Insurance and Finance Union v Consolidated Bank of Kenya Limited (Cause E728 of 2022) [2024] KEELRC 654 (KLR)", Case Analysis (2024). Not stated in judgment (statement of claim dated 13th October, 2022; Cause 2330 of 2018 referenced). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/654/eng@2024-03-14

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