Lawrence Adiyo v Kenya Revenue Authority
The bottom line
#The Court of Appeal ruled that a written employment contract governs your pay and benefits, and retirees were excluded from KRA's salary harmonization scheme.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.whether the trial court did not allow the appellant to call witnesses
- 2.whether the appellant entered into an employment contract with the respondent
- 3.whether the respondent maintained a two tier employment structure, and if so, whether it was lawful
- 4.whether the appellant's contract entitled him to earn a lower scale salary or an executive salary scale
- 5.whether the appellant was entitled to the underpayment claimed as a result of the salary harmonization process
Key legal issues
#Whether the appellant was barred from calling witnesses
The ground fails; the appellant was given the opportunity to obtain witness summons and voluntarily closed his case after two witnesses testified
Though the appellant intended to call nine witnesses, he called only two. He was provided an opportunity to obtain witness summons for all potential witnesses but failed to do so, and nothing in the record showed his witnesses were barred from testifying.
Whether an employment contract existed
A written contract came into existence upon the appellant's acceptance of the offer of appointment of 23rd September 1996, which set out the terms of the parties' relations
The letter of appointment specified the position, job group M, the salary scale and entry point. The appellant confirmed acceptance, so a written contract governed the relations, and the writing, not any alleged intention, governs.
Whether the two tier salary structure was lawful
The two tier structure was lawful; the Board was empowered under section 13(4) of the Kenya Revenue Authority Act to determine terms and conditions of all persons employed, including salaries
Section 13(4) empowered the Board to determine terms and conditions of employment, which include salaries, allowances and benefits. If the Board considered it efficacious to maintain a two tier structure, it was within its mandate provided the decision was in the best interest of the Authority and employees received their lawful dues.
Whether the appellant should have been on the executive salary scale
The appellant's placement in the lower scale was proper; his secondment and qualifications required assignment to the lower scale, and his terms remained as specified in the initial contract unless expressly varied
The criteria for placement in each tier were clearly specified: the executive scale comprised professionals recruited from the private sector and other government bodies, while the ordinary scale included all seconded revenue staff. The appellant was a secondee without a full CPA (K) certificate, and his contract assigned him to job group M.
Whether the appellant was entitled to benefit from the salary harmonization process
No; the harmonization circulars were limited to current employees on the payroll as at 30th January 2002, and retirees were intentionally excluded, consistent with the Board's mandate being limited to persons employed by the Authority
The circulars show the harmonization was implemented in phases and targeted at 'affected staff', limited to current employees on the payroll. By the time the scheme came into operation the appellant had already retired, and unlike P. Kamau, the scheme did not expressly extend benefits to retirees.
Legal principles established
#- On a first appeal the Court of Appeal must reconsider and evaluate the evidence and draw its own conclusions, making allowance for not having seen or heard the witnesses
- Where there is a written contract of employment reduced into writing, it is the writing which governs the parties' relations
- A point abandoned in the trial court cannot be raised for the first time on appeal
Court orders
#- 1.The appeal is dismissed
- 2.Each party to bear its own costs
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- High Court at Nairobi
- HCCC 825 of 2003
- Jurisdiction invoked
- First appeal to the Court of Appeal under its appellate jurisdiction (the judgment does not cite a specific provision)
Relief refused
#Claim for underpayment of salary, severance package and salary in lieu of notice (Kshs. 5,529,594)
Appellant's terms were fixed by the 1996 contract; he had retired before the harmonization scheme and retirees were excluded from it
Re-raised claim that the two tier salary structure was discriminatory and unconstitutional
The prayer was abandoned in the trial court and cannot be raised on appeal
Costs
Each party to bear its own costs (the appellant being a retired senior citizen)
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
We have said enough to show that the appeal is without merit, and we order that the same be and is hereby dismissed. The appellant being a retired senior citizen, we order each party to bear its own costs.
It is well settled that where there is a written contract of employment, as there was here, and the parties have reduced it into writing, it is the writing which governs their relations. It is not permissible to say they intended something different.
having abandoned the issue in the trial court, it cannot be raised at this stage of the proceedings, and we see no reason to address it.
it was limited in application to the respondent’s current employees who existed on the payroll as at the date of the circular, that being 30th January 2002.
On a first appeal from the High Court, the Court of Appeal shall reconsider the evidence, evaluate it itself and draw its own conclusions though it should always bear in mind that it has never seen or heard the witnesses and should make due allowance in that respect.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Lawrence Adiyo v Kenya Revenue Authority", Case Analysis (2018). Civil Appeal No. 98 of 2011. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2018/837/eng@2018-02-16
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.