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ELRCPartially AllowedNot stated in the judgment

Agong v Jaramogi Oginga Odinga University of Science & Technology (JOUST) & 3 others (Cause E074 of 2023) [2024] KEELRC 1209 (KLR)

Employment and Labour Relations Court
22 May 2024
2,457 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~10 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court refused to enforce a university Vice-Chancellor's exit package because he hid a circular invalidating it, but ordered a Kshs 329,150 deduction repaid.

What this practically means

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Executive summary

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The Claimant, a former Vice-Chancellor of Jaramogi Oginga Odinga University of Science and Technology, sued the University, its Vice-Chancellor, Council and Chief Finance Officer after his exit package, agreed in his 2018 renewal contract, was not implemented following the end of his second term on 19 June 2023. The State Corporations Advisory Committee advised that the package was irregular under a Circular from the Head of the Public Service dated 14 May 2015 directing that outgoing Vice-Chancellors revert to their pre-appointment terms. The Claimant argued the package was contractual, that its unilateral withdrawal was an unfair labour practice and breached fair administrative action, relying on the Magoha and Tuitoek decisions. The Respondents contended the package was founded on illegality, invoking ex dolo malo, non oritur actio. The Court found the Claimant, as CEO, knew of the 2015 Circular and had applied it to his deputies, yet negotiated the 2018 renewal without disclosing it to the Council, distinguishing Tuitoek. The exit package was therefore unenforceable. However, the University's deduction of Kshs 329,150/- as excess gratuity was unlawful because the policy clause relied upon was not produced in evidence. The Claimant succeeded partly: the deduction was ordered reimbursed, the exit package was declared unenforceable, and each party was ordered to bear its own costs.

Questions the Court framed

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The issues the Court set itself to decide, in its own words.

  1. 1.Whether there is a legally and procedurally concluded employment contract between the Claimant and the 3rd Respondent
  2. 2.Whether the unilateral review of the Claimant's remuneration despite the subsistence of a duly executed employment contract amounts to unfair, irregular and unconstitutional labour practice on the part of the Respondents
  3. 3.Whether the gratuity payments previously made to the Claimant were procedural
  4. 4.Whether the recovery of the Claimant's gratuity for the June 2023 salary by the 1st Respondent amounts to unfair, illegal and unconstitutional labour practice
  5. 5.Who shall bear the costs of the suit

Key legal issues

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01

Enforceability of the exit package in the Claimant's 2018 contract

Holding

The exit package was unenforceable because the Claimant, who knew of the 2015 Circular barring exit packages, did not disclose it to the University Council during negotiations

Reasoning

The Court distinguished the Magoha and Tuitoek lines of authority. Unlike Prof Tuitoek, the Claimant knew of the 14 May 2015 Circular well before 2018, having applied it to his deputies. As CEO he negotiated the renewal without disclosing the invalidation of exit packages, so he did not come to Court with clean hands and the package could not be enforced.

p. 5
02

Lawfulness of the deduction of Kshs 329,150/- from the Claimant's dues

Holding

The deduction was unlawful because the policy clause relied on by the University was not produced in evidence

Reasoning

The University justified the deduction as recovery of excess gratuity based on clause 19 of an October 2018 Policy. However, the Respondents did not place a copy of that Policy before the Court; the extract of the Terms and Conditions of Service for Senior Management Staff did not include the clause. Without proof of the contractual basis, the deduction could not stand.

p. 6

Legal principles established

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  • An exit package negotiated by a public officer who was aware of a Circular invalidating such packages, without disclosure to the other contracting party, is unenforceable for lack of clean hands
  • A salary deduction not supported by the contract or a policy produced before the Court is unlawful

Court orders

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  1. 1.A declaration that the exit package was/is unenforceable in the case of the Claimant
  2. 2.Reimbursement to the Claimant of Kshs 329,150/- deducted from his dues
  3. 3.Each party to bear own costs

The bench

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One judgment of the whole court — no separate or dissenting opinions.

majority

Wrote the judgment

Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over employment disputes (Employment and Labour Relations Court Act; Employment Act, 2007); no specific provision cited

Relief refused

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Enforcement of the exit package (retention of Vice-Chancellor salary, house allowance and benefits)

The Claimant, as CEO, knew of the 14 May 2015 Circular invalidating exit packages and did not disclose it to the University Council when negotiating the 2018 contract; the package was founded on illegality

p. 5

Claims of unfair labour practice and breach of fair administrative action in respect of the exit package

The Claimant's failure to disclose the Circular disentitled him from enforcing the package

p. 5

Costs

Each party to bear own costs

Quotable passages

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Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.

The Court, therefore, concludes that the exit package was/is unenforceable in the case of the Claimant.
p. 5exit package unenforceability
The Claimant failed to bring to the attention of the University Council material and relevant information concerning his terms and conditions of service (invalidation of exit package) to enable the Council to make an informed decision and negotiate with him on equal terms.
p. 5duty of disclosure by public officer in contract negotiations
The Court, in the circumstances finds that the deduction was unlawful and not supported by the contract in place.
p. 6unlawful salary deduction
The Claimant has succeeded partly. Each party to bear own costs.
p. 6final orders and costs

Issues in the judgment

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minor

The judgment's formatting of the Claimant's issues is confused: paragraph 17 is blank and the listed issues appear under paragraph 18, and the number of issues announced (4) does not match the five listed

minor

The Respondents are described inconsistently between the claim as filed (Jaramogi University of Science and Technology, Vice Chancellor, the University Council and the Chief Finance Officer) and references to the 1st and 3rd Respondents

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, "Agong v Jaramogi Oginga Odinga University of Science & Technology (JOUST) & 3 others (Cause E074 of 2023) [2024] KEELRC 1209 (KLR)", Case Analysis (2024). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/1209/eng@2024-05-22

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