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ELRCPartially AllowedCause No E274 of 2021· [2024] KEELRC 667 (KLR)

Njeru v Nawiri Sacco Society Limited (Cause E274 of 2021) [2024] KEELRC 667 (KLR)

Employment and Labour Relations Court
21 March 2024
MOMaureen Onyango
2,065 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~8 min to read original · ~4 min brief

The bottom line

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A dismissed Kenyan SACCO employee recovered unpaid dues but lost gratuity and notice claims because she couldn't produce the CBA clauses proving entitlement.

What this practically means

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Executive summary

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The claimant, a former employee of the respondent SACCO represented by BIFU (Kenya) under a recognition agreement and a CBA signed on 3rd July 2019, sued for terminal dues following her summary dismissal in October 2020. She sought an injunction restraining the sale of her father's property given as security for a Kshs. 700,000 Staff Development Loan, terminal dues of Kshs. 196,173 (gratuity, notice pay, leave, days worked, overtime and out-of-office allowances), and payment of share deposits of Kshs. 130,000. In submissions she additionally claimed refund of loan interest of Kshs. 188,738 and survey, valuation and auctioneer fees. The respondent contended that the claimant was summarily dismissed under clause 4 of the CBA and never challenged the dismissal, so no notice pay was due, and that all terminal benefits had been paid. The suit was disposed of by pleadings, affidavits and written submissions by consent. The court held that the claimant, not having contested her summary dismissal, was not entitled to gratuity or pay in lieu of notice, as she produced no CBA clauses conferring such entitlements. It awarded her Kshs. 5,304.50 for five days worked to 5th October 2020, Kshs. 22,034 for untaken leave, Kshs. 2,500 overtime and Kshs. 7,200 out-of-office allowances. Claims for loan interest, auctioneer/survey/valuation fees and share deposits were held to fall within the Cooperatives Tribunal's jurisdiction, not that of the ELRC. The claim partially succeeded; the claimant was awarded costs of Kshs. 50,000. Judgment delivered virtually on 21st March 2024 by Maureen Onyango, Judge.

Key legal issues

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01

Entitlement to gratuity and notice pay after summary dismissal

Holding

Not proved; claimant did not produce CBA clauses entitling her to gratuity or notice after summary dismissal

Reasoning

The claimant only produced pages 1, 4, 5, 7, 10 and 15 of the CBA, none containing a gratuity provision or one entitling a summarily dismissed employee to notice. The respondent had asserted dismissal under clause 4 of the CBA. Absent production of the relevant clauses, the court could not presume such entitlements, and as a matter of course a dismissed employee is not entitled to notice.

p. 5
02

Salary for days worked, leave, overtime and out-of-office allowances

Holding

Awarded in the sums of Kshs. 5,304.50, 22,034, 2,500 and 7,200 respectively

Reasoning

The dismissal letter was dated 5th October 2020 and the respondent did not prove payment of salary for days worked up to that date. The respondent produced no proof that leave days had been exhausted or paid for, and did not deny the overtime and out-of-office allowances claims, so they were awarded as prayed.

p. 5
03

Jurisdiction over loan interest, auctioneer/survey/valuation fees and share deposits

Holding

Outside this court's jurisdiction; reserved to the Cooperatives Tribunal

Reasoning

The claims concerning interest charged on the Staff Development Loan, fees loaded onto the loan, and the claimant's share deposits relate to her membership of and dealings with the SACCO rather than her employment or terminal benefits. Such claims fall within the Cooperatives Tribunal's mandate, so this court declined to determine them.

p. 5

Legal principles established

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  • A claimant who does not contest summary dismissal is ordinarily not entitled to notice pay absent a contractual or CBA provision
  • A party asserting entitlement under a CBA must produce the specific clause relied upon; the court will not presume a gratuity entitlement
  • The Employment and Labour Relations Court's jurisdiction is confined to employment-related claims; loan and SACCO membership claims belong to the Cooperatives Tribunal
  • An employer who fails to prove payment of salary for days worked remains liable for it

Court orders

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  1. 1.Award of Kshs. 5,304.50 for 5 days worked up to 5th October 2020
  2. 2.Award of Kshs. 22,034 for annual leave days as prayed
  3. 3.Award of Kshs. 2,500 for overtime as prayed
  4. 4.Award of Kshs. 7,200 for allowances for working out of office as prayed
  5. 5.Award of costs of Kshs. 50,000 to the Claimant, having been partially successful
  6. 6.Prayers for gratuity, pay in lieu of notice, refund of loan interest, auctioneer/survey/valuation fees and shares refused/dismissed

Authorities

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Legislation

  • Co-Operative Societies ActNot specified
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over terminal benefits/employment disputes; claims on loan interest, shares and auctioneer/survey fees held to fall within the jurisdiction of the Cooperatives Tribunal

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, "Njeru v Nawiri Sacco Society Limited (Cause E274 of 2021) [2024] KEELRC 667 (KLR)", Case Analysis (2024). Cause No E274 of 2021. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/667/eng@2024-03-21

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