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ELRCAllowedELRC Cause No. 479 of 2018 (consolidated with ELRC Cause No. 98 of 2019, Mombasa Petition No. 26 of 2019 and ELRC No. 478 of 2018)· [2024] KEELRC 2400 (KLR)

Transport Workers Union v Spedag Interfreight Kenya Limited (Cause 98 & 26 of 2019 & 479 of 2018 (Consolidated)) [2024] KEELRC 2400 (KLR)

Employment and Labour Relations Court
1 October 2024
6,586 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~26 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court ordered a logistics company to pay union dues, agency fees, and an 8% backdated wage increase after ignoring a valid CBA.

What this practically means

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Executive summary

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The claimant union, recognised in 2012 and with a registered CBA dated 17 July 2017 covering April 2017 to March 2019, sought enforcement of Legal Notice No.130 of 2018 (an agency fees order), payment of unremitted agency fees from the respondent's funds, implementation of clause 3.2 of the CBA providing an 8% wage increase backdated to 1 April 2018, an order for the Mombasa County Labour Officer to compute dues, and costs. The suits were consolidated with ELRC Cause No.98 of 2019, Mombasa Petition No.26 of 2019 and Cause No.478 of 2018. The respondent denied the union's standing, disputing the Recognition Agreement and majority membership, asserted personalised contracts better than the CBA, and maintained that the redundancy it declared followed section 40 of the Employment Act. The court held that a Recognition Agreement remains valid until revoked by the National Labour Board, and the respondent's pending revocation application itself confirmed the agreement's existence, giving the union standing. The registered CBA bound the respondent; Legal Notice No.130 of 2018 was valid and the respondent's failure to deduct and remit agency fees was inexcusable, entitling the union to payment from the respondent's funds. The evidence of personalised contracts and employee resignations was left bare. On redundancy, consultation is implied in section 40, notice should have issued to the union, and severance was paid at 15 instead of the agreed 20 days. Judgment was entered for the claimant with declarations on the Recognition Agreement and CBA, orders on agency fees and the 8% wage increase, a Labour Officer's computation with a report due in 30 days, and costs of the suit and of the Labour Officer awarded to be met by the respondent.

Key legal issues

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01

Whether the claimant union had locus standi

Holding

The union had standing because a Recognition Agreement exists and a CBA was registered; the respondent's own application to the National Labour Board to revoke the agreement evidences its existence, and until revoked the agreement remains valid.

Reasoning

Recognition under section 54 of the LRA requires a simple majority, but recognition was long since granted and a CBA dated 17 July 2017 registered. Section 54(5) and (6) govern termination or revocation of a recognition agreement through the National Labour Board. The respondent's pending application to revoke is itself proof the agreement exists. Until the Board determines it, the agreement remains valid and the union retains the right to negotiate and represent unionisable employees.

p. 8
02

Enforceability of Legal Notice No.130 of 2018 (agency fees)

Holding

The Legal Notice is valid and the respondent was duty-bound to deduct and remit agency fees for all unionisable employees covered by the CBA; its failure entitles the claimant to payment from the respondent's own funds.

Reasoning

Sections 48, 49 and 54 of the LRA read together allow a union with a registered CBA to obtain a Ministerial agency fee order. Non-member employees who benefit from negotiated CBA terms are free riders who must contribute via agency fees. The employer must commence deductions within thirty days of receiving the Minister's notice under section 49(3). The respondent's failure breached the LRA and section 19 of the Employment Act.

p. 11
03

Implementation of phase two of the CBA (8% wage increase)

Holding

The CBA was lawful and the respondent was required to implement the 8% wage increase backdated to 1 April 2018; the respondent's claims of personalised contracts and employee resignations were left bare.

Reasoning

Once a CBA is registered with the court it becomes enforceable on its terms. The respondent could not unilaterally negotiate better personalised terms without consulting the recognised union; doing so amounted to unfair labour practice. The evidence of personalised contracts and resignations from union membership was unsupported by records, so the court accepted the claim for the backdated increase, to be computed with the Labour Officer's assistance.

p. 11
04

Redundancy dues

Holding

The redundancy process required notice to the union and Labour Officer and compliance with the CBA's severance terms; affected employees were paid 15 days' severance instead of the agreed 20 days, and the balance is due.

Reasoning

Under section 40 of the Employment Act consultation is implied, and where employees are unionised notice must issue to the union and Labour Officer. The CBA negotiated severance pay of 20 days per year worked. The claimant's evidence that 15 days was paid is contrary to the CBA. Lacking records of terminal dues paid, the court allowed the Labour Officer to inspect records and assess the dues.

p. 11

Legal principles established

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  • A Recognition Agreement remains valid and lawful until revoked by the National Labour Board; an employer cannot unilaterally stop implementing it.
  • Once registered with the court, a CBA is enforceable on its terms, and a union that negotiated it is entitled to agency fees from non-member unionisable employees covered by the agreement.
  • An employer is bound to comply with a Ministerial Order/Legal Notice on agency fee deduction pending any clarification or intervention from the Minister.
  • Consultation is implied in section 40 of the Employment Act; where employees are unionised, notice of redundancy should issue to their trade union and the Labour Officer.

Court orders

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  1. 1.A declaration that the Recognition Agreement between the parties is valid and lawful
  2. 2.A declaration that the CBA dated 17 July 2017 between the parties is lawful and valid
  3. 3.An order compelling the respondent to pay agency fees contained in Legal Notice No.130 dated 13 June 2018 to the claimant from its funds
  4. 4.An order compelling the respondent to apply clause 3.2 of the CBA dated 17 July 2017 on wage increment backdated to 1st April 2018 and pay all unionisable employees an 8% wage increase
  5. 5.The Mombasa County Labour Officer to assist the parties and the court in the computation of the amounts due on account of unremitted agency fees, salary arrears and redundancy dues
  6. 6.The costs due to the Labour Officer to be met by the respondent
  7. 7.A report of the Labour Officer to be submitted in 30 days for the adoption of the court
  8. 8.Costs of the suit to be paid by the respondent

Authorities

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Legislation

  • Labour Relations ActSections 4(1) and (2), 48, 48(7) and (8), 49, 49(1), 49(3), 49(5), 50, 54, 54(1), 54(5) and (6), 59(5), 69, 74
  • Employment ActSections 19, 19(1)(f) and (g), 19(6), 40, 40(1)(a) and (b), 49
  • Legal Notice No.130 of 2018 (Transport Workers Union Deduction of Agency Fees Order, 2018)Whole
  • Constitution of KenyaArticles 2, 10, 40, 41, 41(1)(c), 47, 50
  • ILO Conventions No. 87 and No. 98Whole

Cases cited (15)

  • Kenya Aviation Workers Union v Bollore Africa Logistics-Kenya & Another
    [2016] eKLR
  • Tailors & Textile Workers Union v New Wide Garments Kenya (EPZ) Limited
    [2013] eKLR; Cause No.1624 of 2013
  • Kenya Jockey and Betting Workers Union v Resort Kenya Limited
    [2024] eKLR
  • Kenya Shoe and Leather Workers Union v Crown Industries Limited & Another
    [2017] eKLR
  • Modern Soap Factory v Kenya Shoe and Leather Workers Union
    [2020] eKLR
  • Kenya National Union of Nurses v County Public Service Board Homa Bay
    [2018] eKLR
  • Kenya Private Universities Workers Union v Management University of Africa
    [2021] eKLR
  • Kenya National Union of Teachers (Knut) v Nancy Njeri Macharia & another
    [2020] eKLR
  • Kenya Union of Entertainment and Music Industry Employees v Bomas of Kenya Limited
    [2018] eKLR
  • Amalgamated Union of Kenya Metal Workers v Unity Auto Garage (Nrb) Limited
    [2014] eKLR
  • Union of Kenya Civil Servants v Kenya Medical Research Institute & another
    [2021] eKLR
  • Kenya Long Distance Truck Drivers & Allied Workers Union v Ms Kyoga Hauliers Ltd
    [2013] eKLR
  • Dadson Maina & 33 Others v Board of Management, Nyeri Primary School
    [2017] eKLR
  • Kenya Hotels and Allied Workers Union v Attorney General & 6 others
    (2015) eKLR
  • Cargill Kenya Limited v Mwaka & 3 others
    (Civil Appeal 54 of 2019) [2021] KECA
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over trade union recognition, CBAs, agency fees and redundancy disputes (Labour Relations Act; 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, "Transport Workers Union v Spedag Interfreight Kenya Limited (Cause 98 & 26 of 2019 & 479 of 2018 (Consolidated)) [2024] KEELRC 2400 (KLR)", Case Analysis (2024). ELRC Cause No. 479 of 2018 (consolidated with ELRC Cause No. 98 of 2019, Mombasa Petition No. 26 of 2019 and ELRC No. 478 of 2018). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/2400/eng@2024-10-01

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