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ELRCPartially AllowedNot stated in judgment· [2024] KEELRC 2833 (KLR)

Musyoki v Lukenya University (Cause E002 of 2023) [2024] KEELRC 2833 (KLR)

Employment and Labour Relations Court
15 November 2024
BOByram Ongaya
759 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A part-time lecturer won Kshs. 679,200 in salary arrears but lost a bigger claim because he couldn't disprove the employer's figures or prove he was a consultant.

What this practically means

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Executive summary

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The claimant, employed by the respondent as a part-time lecturer from April 2019 on successive semester-based contracts, sued for salary arrears of Kshs. 943,760.00 for April 2019 to September 2022, a declaration that his earnings should attract 5% withholding tax rather than 30% PAYE, a KRA withholding tax certificate, general damages, interest and costs. The respondent admitted the employment but asserted that terms varied per semester, pay was per credit hour, the Kshs. 4,000.00 payment applied only for physical attendance in Full Time Programs, arrears for early semesters had been paid, and that it was statutorily obliged to deduct PAYE. The respondent computed the true indebtedness at Kshs. 679,200.00 inclusive of taxes, comprising six semesters' transport allowances of Kshs. 24,000.00. The court found the parties were in a contract of service, not a consultancy, so PAYE rather than withholding tax applied; the claimant offered no basis for the withholding-tax claim and did not rebut the respondent's computations. The claimant also failed to file final submissions. Judgment was entered for Kshs. 679,200.00 less due PAYE, payable by 15.12.2024, with interest at court rates from filing in default; the respondent was ordered to deliver documents evidencing remission of deducted PAYE; each party was to bear its own costs; and the Deputy Registrar was directed to return the court file to Machakos Sub-registry. The suit was therefore partially allowed.

Key legal issues

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01

Applicable tax regime on part-time lecturer's earnings

Holding

PAYE applies, not 5% withholding tax, because the parties were in a contract of service

Reasoning

The court found that the claimant was employed under successive contracts of service as a part-time lecturer and not as an independent consultant providing professional services. The claimant did not establish the basis for applying the 5% withholding tax regime. Accordingly, the court held the respondent's statutory duty to deduct income tax by way of PAYE applied to the claimant's earnings.

p. 2
02

Quantum of salary arrears and transport allowance

Holding

The amount owed was Kshs. 679,200.00 inclusive of taxes, not the Kshs. 943,760.00 claimed

Reasoning

The respondent's evidence and submissions established that pay was per credit hour (maximum 39 hours at Kshs. 1,200.00) plus Kshs. 4,000.00 per Full Time Program appearance, and that transport allowance was due only where physical attendance was required. The claimant did not rebut this, and failed to file submissions, so the court adopted the respondent's computation of Kshs. 679,200.00.

p. 2

Legal principles established

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  • A part-time lecturer engaged under contracts of service is subject to PAYE deductions, not withholding tax applicable to consultancies
  • A party who fails to rebut the other side's pleaded terms and uncontroverted final submissions is bound by those submissions

Court orders

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  1. 1.The respondent to pay the claimant Kshs. 679,200.00 less due PAYE by 15.12.2024, failing which interest to run at Court rates from the date of filing the suit until full payment
  2. 2.The respondent to deliver to the claimant due documents showing the remission of the deducted PAYE
  3. 3.Each party to bear own costs of the suit
  4. 4.The Deputy Registrar to cause return of the court file to Machakos Sub-registry forthwith
Jurisdiction invoked
Employment and labour relations dispute under the Employment and Labour Relations Court's statutory jurisdiction

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, "Musyoki v Lukenya University (Cause E002 of 2023) [2024] KEELRC 2833 (KLR)", Case Analysis (2024). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/2833/eng@2024-11-15

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