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ELRCPartially AllowedNot stated in the judgment

Kenya Union of Domestic Workers, Hotels, Educational Institutions and Hospital Workers Union(KUDHEIHA) v Board of Management - Magui Secondary School (Employment and Labour Relations Cause E014 of 2024) [2024] KEELRC 2639 (KLR)

Employment and Labour Relations Court
24 October 2024
4,104 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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A Kenyan employment court refused to impose a pay rise itself, ruling that wages must be settled through genuine negotiation backed by expert financial analysis.

What this practically means

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Executive summary

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This first-instance claim by a trade union against an employer (a secondary school, represented through the Attorney General) concerned two unresolved issues in a negotiated Collective Bargaining Agreement: the general wage increment and the effective date of the CBA. After failed conciliation and a certificate of unresolved dispute dated 3rd April 2024, the union sought an order that the employer grant a 30% first-year and 20% second-year salary increment and adopt a CBA period of 1st July 2023 to 30th June 2025. The employer resisted, citing underfunding of secondary schools, risk of insolvency, and proposed 0% increment with effect from 1st July 2024 to 30th June 2026. The Court, per Jemimah Keli, J, restated that collective bargaining is voluntary and founded on social dialogue, citing ILO Convention 98 Article 4 and Court of Appeal authority (TSC v KNUT; Kenya Tea Growers Association) that in wage disputes a court must consider productivity, cost of living and the employer's ability to pay, and must not substitute its preference for the parties' freedom to agree. Finding itself without expertise on the employer's capacity to absorb labour costs, the Court referred the wage increment question to the Central Planning and Monitoring Unit of the Ministry of Labour and Social Protection for an expert report to be filed within 30 days. On the effective date, the Court accepted the Respondent's inchoate contract argument, held that rights under the CBA had not vested before negotiations concluded in 2024, adopted the employer's period of 1st July 2024 to 30th June 2026, and directed the parties to appear on 27th November 2024 to canvass the report.

Questions the Court framed

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

  1. 1.Whether the Respondent should give an increment to the worker's salary as per the claimant's proposal which is 30% increment for the first year and 20% second year or to adopt their salary increment proposal which is 0% first year and 0% second year.
  2. 2.Whether the Respondents should agree on the claimant's proposal on effective date of 1st July 2023 to 30th June 2025 or to adopt their proposal of 1st July 2024 to 30th June 2026.

Key legal issues

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01

Whether the Respondent should grant the union's proposed wage increment (30%/20%) or its own 0% proposal

Holding

The Court declined to decide the increment itself and referred the question to the Central Planning and Monitoring Unit of the Ministry of Labour and Social Protection for an expert report to be filed within 30 days, with the matter to be mentioned on 27th November 2024.

Reasoning

The Court relied on ILO Convention 98 Article 4 and the Court of Appeal authority that collective bargaining is voluntary and that in economic disputes a court should consider productivity, cost of living and ability to pay. Holding itself not an expert on labour costs, and unwilling to substitute its preference for the parties' freedom of contract, it found expert evidence necessary to assess the Respondent's financial capacity and accordingly referred the issue for expert determination.

p. 6
02

Whether the CBA effective date should be 1st July 2023 to 30th June 2025 (union) or 1st July 2024 to 30th June 2026 (employer)

Holding

The Court adopted the Respondent's proposal, holding the effective period of the CBA to be 1st July 2024 to 30th June 2026.

Reasoning

The Court applied section 59 of the Labour Relations Act and accepted the Respondent's submission, supported by Mtana v Sopa Lodges (2024) eKLR and Black's Law Dictionary, that before conclusion of negotiations in 2024 the CBA was an inchoate contract whose rights had not vested. Since negotiations concluded in 2024 and the employer bears the burden of labour costs, backdating the CBA would be unreasonable; the Respondent's dates were correct and reasonable.

p. 8

Legal principles established

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  • Negotiation of a CBA is voluntary and founded on social dialogue between employer and trade union; the Court cannot substitute its preference for the parties' freedom to agree on terms of employment.
  • A court faced with a question of wage increment ought to take into account productivity, cost of living and the ability of the employer to pay.
  • Rights and terms under a CBA do not vest before conclusion of negotiations; a collective agreement becomes enforceable upon registration by the Industrial Court and is effective from the date agreed by the parties.

Court orders

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  1. 1.The dispute on wage increment is referred to the Central Planning and Monitoring Unit of the Ministry of Labour and Social Protection to prepare an expert report taking into account all relevant parameters to assist the Court in determining whether the Respondent should grant a 30%/20% increment or a 0% increment
  2. 2.The effective date of the CBA is fixed at 1st July 2024 to 30th June 2026, adopting the Respondent's proposal
  3. 3.The expert report to be filed in Court in 30 days and supplied to the parties
  4. 4.Parties to appear before the Court on 27th November 2024 to canvass the report and for determination of the wage increment issue

The bench

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

majority

Wrote the judgment

Jurisdiction invoked
Jurisdiction under the Labour Relations Act and Employment Act following failed conciliation of an unresolved collective bargaining dispute (Certificate of unresolved dispute dated 3rd April 2024)

Relief refused

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Claimant's proposal that the CBA effective date be 1st July 2023 to 30th June 2025

The Court agreed the CBA was an inchoate contract before conclusion of negotiations and found it could not backdate the CBA absent agreement; the Respondent's proposed period was reasonable given the financial burden on the Respondent.

p. 8

Claimant's proposal of 30% salary increment for the first year and 20% for the second year (and the Respondent's 0% proposal)

The Court lacks expertise to assess the employer's ability to pay and cannot substitute its preference for the parties' freedom to agree; the issue was referred to the Central Planning and Monitoring Unit for an expert report.

p. 8

Costs

No costs order made in the judgment.

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.

It is so Ordered.
p. 7Final orders / disposition
The Court on the issue of the effective period of the Collective Bargaining Agreement between the parties holds the period to be 1st July 2024 to 30th June 2026.
Effective date of the CBA
The Court reiterates that the negotiation of a CBA is voluntary and founded on social dialogue between the employer and employee trade union.
p. 5Voluntary nature of collective bargaining
The Court agreed with the inchoate legal principle that the rights and terms under the CBA had not vested before the conclusion of the negotiations.
p. 8Inchoate nature of an unagreed CBA
Consequently, a Court faced with a question of wage increment ought to take into account productivity, cost of living and the ability to pay by the employer.
p. 6Court's role in wage-increment disputes

Issues in the judgment

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minor

The judgment does not state the full name of the Respondent or the case number of the suit; the parties and cause number are not identified beyond the Claimant union.

minor

The Respondent's pleadings are inconsistently described as a 'Response to the Memorandum of Appeal' where the suit is a Memorandum of Claim.

minor

The date of one conciliation meeting is given as '26th July 203', an apparent typographical error for 2023.

minor

The certificate of unresolved dispute is described as dated 3rd April 2024 in one place, while paragraph 21 introduces the certificate under a heading dated 3rd April 2024 in a differently numbered list, creating minor formatting ambiguity; both references concern the same certificate.

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 Domestic Workers, Hotels, Educational Institutions and Hospital Workers Union(KUDHEIHA) v Board of Management - Magui Secondary School (Employment and Labour Relations Cause E014 of 2024) [2024] KEELRC 2639 (KLR)", Case Analysis (2024). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/2639/eng@2024-10-24

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