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ELRCPartially AllowedCause No E010 of 2021· [2025] KEELRC 720 (KLR)

Kenya Union of Commercial, Food and Allied Workers v Khetia Garments Limited (Cause E010 of 2021) [2025] KEELRC 720 (KLR)

Employment and Labour Relations Court
6 March 2025
MOMaureen Onyango
4,090 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~16 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court ordered an employer to sign a CBA with the union, awarding wage increases effective January 2025 instead of backdated arrears.

What this practically means

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Executive summary

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The Claimant union and the Respondent company had a recognition agreement signed on 1st November 2019. The Claimant forwarded proposals for the 2020/2022 CBA in March 2019, but the Respondent refused to provide counter-proposals, citing the COVID-19 pandemic. A trade dispute reported to the Cabinet Secretary was conciliated without success, and a certificate of unresolved dispute issued in January 2021. The Claimant sued seeking an order compelling the Respondent to sign the 2020-2022 CBA as proposed; interim orders restraining victimisation of union members were issued on 26th February 2021. The Respondent's application to discharge those orders and a declaration that the Claimant no longer commanded the simple majority required under section 54 of the Labour Relations Act were not granted. After failed settlement talks, the court referred the matter to the CPMU, whose report of 31st August 2023 found the Respondent profitable and computed a CPI entitlement of 9.36% over two years. The court held that under section 54 an employer with a subsisting recognition agreement must negotiate a CBA, and that the simple-majority challenge was not an issue before it since the recognition agreement had not been terminated or revoked. Relying on the Court of Appeal's decision in Kenya Tea Growers Association, the court confirmed its jurisdiction over economic disputes and, guided by the CPMU report, awarded monetary clauses (10% above statutory minimum wage, 5% annual increases over two years, 15% house allowance) and largely adopted the Claimant's proposals for non-monetary clauses. The effective date was set at 1st January 2025, with each party bearing its own costs, and the parties directed to draft and sign the CBA within 30 days.

Key legal issues

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01

Whether the ELRC has jurisdiction to determine the terms of a CBA where parties cannot agree

Holding

Yes; the ELRC is empowered by the Constitution, the ELRC Act and the Labour Relations Act to adjudicate trade disputes arising from CBA negotiations, including economic disputes, following Part VIII and Part IX procedures

Reasoning

Article 162(2)(a) establishes the ELRC for employment and labour disputes. Under Part IX, s. 73(1) of the LRA an unresolved trade dispute is referred to the ELRC for adjudication. The Court of Appeal in Kenya Tea Growers Association held that this includes disagreement over CBA terms, and that s. 26(2) of the Employment Act empowers the ELRC to issue terms more favourable than statutory minima, exercised judiciously and guided by the Wage Guidelines.

p. 7
02

Whether the Respondent could resist the CBA on the ground that the Claimant no longer commanded a simple majority

Holding

No; that is not an issue before the court because the recognition agreement remains valid and un-terminated

Reasoning

Section 54(5)-(8) of the LRA governs disputes over termination or revocation of recognition agreements, which lie before the National Labour Board. The dispute here concerned terms and conditions to be incorporated into a CBA, not recognition. Since a valid recognition agreement subsisted, the Respondent was obliged to negotiate a CBA; the simple-majority argument was therefore not open in this suit.

p. 6
03

What CBA terms should be awarded given the Respondent made no counter-proposals

Holding

The court awarded monetary clauses guided by the CPMU report and non-monetary clauses largely as per the Claimant's proposals or statute

Reasoning

The Respondent filed no proposals on the CBA, confining itself to a membership challenge. The only objection raised during negotiations was COVID-19, which had passed. Guided by the CPMU report (CPI of 9.36% over two years, productivity achieved, profitability) and the Wage Guidelines factors, the court awarded a 10% basic minimum wage uplift, 5% annual wage increases for each of two years, 15% house allowance, and other clauses per statute or the Claimant's proposals.

p. 8
04

The effective date of the CBA

Holding

Effective date fixed at 1st January 2025 rather than the Claimant's proposed 1st January 2020

Reasoning

Although the Claimant sought effect from 1st January 2020, the court considered that arrears of wages for 2020-2024 would be too burdensome on the Respondent, while recognizing that the Respondent's own delay should not be entirely to the detriment of the Claimant's members and accounting for COVID-19 effects on the Respondent's operations.

p. 10

Legal principles established

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  • Until a recognition agreement is terminated or revoked by the National Labour Board, the employer is under an obligation to negotiate a CBA with the recognised union; a simple-majority dispute is not a bar in a CBA-terms dispute
  • The ELRC is empowered to determine economic disputes over CBA terms where parties are unable to agree, guided by the Wage Guidelines (productivity, cost of living, ability to pay)

Court orders

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  1. 1.CBA monetary and non-monetary clauses awarded as set out (basic minimum wages 10% above statutory minimum; annual wage increase 5% for 1st year and 5% for 2nd year; house allowance 15% of basic salary; and other clauses as per Claimant's proposal or statute)
  2. 2.Effective date of the CBA fixed at 1st January 2025
  3. 3.Each party to bear its own costs of the suit
  4. 4.Parties directed to draft and sign the CBA within 30 days
  5. 5.Orders accordingly

Authorities

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Legislation

  • Labour Relations Actsection 54; section 2; sections 73(1) (Parts VIII and IX); section 49
  • Employment Actsection 26(2); section 28; section 44; section 24; section 51
  • Employment and Labour Relations Court Actjurisdiction
  • Labour Institutions Actwages orders
  • Regulation of Wages (General) Orderrule 11 (compassionate leave); paragraph 3 (acting allowance)
  • Constitution of KenyaArticle 162(2)(a)

Cases cited (3)

  • Kenya Union of Commercial, Food and Allied Workers v House Mart Limited
    [2021]
  • Bakery, Confectionary, Food Manufacturing and Allied Workers’ Union (Kenya) v Proctor and Allan (E.A) Limited
    [2015]
  • Kenya Tea Growers Association v Kenya Plantation and Agricultural Workers Union
Jurisdiction invoked
Article 162(2)(a) of the Constitution; Employment and Labour Relations Court Act; Labour Relations Act (Part IX, s. 73(1))

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, "Kenya Union of Commercial, Food and Allied Workers v Khetia Garments Limited (Cause E010 of 2021) [2025] KEELRC 720 (KLR)", Case Analysis (2025). Cause No E010 of 2021. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/720/eng@2025-03-06

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