LABOUR LAW NOTES

INTRODUCTION TO LABOUR LAW

DEFINITION OF LABOUR LAW

Labour Law deals with persons in capacity of workers generally in the labour law market. The relationship involves two parties at a basic level so that it can be termed as a relationship governing the employer and the employee.

Definition at a basic level is that an employee contracts to render services for a reward and employer contracts to pay that reward for work done.

Often an employee is referred to as a “Worker”. However the term worker is not used in labour law in “Marxian” sense but in the “capitalistic” sense.

Labour law is also used interchangeably with Industrial Law. They are however different in that:- 

1. Industrial law covers employer-employee relationship more adequately.

2. Industrial law is wider in application as it involves studies like taxation, Industrial property and social security not falling within labour law.

3. Labour law is a more preferred terminology.

Labour law refers to a body of legal rules which regulates the relationship between:-

1. an employer and a worker

2. an employer and workers

3. employer(s) and trade union representing  workers

4. employers’ organization and trade unions

5. the state, employers, workers, unions and employer organizations

SCOPE OF LABOUR LAW

Labour Law is defined in part by its subject matter and in part by intellectual tradition. Intellectual tradition is the heritage of Prof. Otto Khan Freund and the Lord Wedderburn. The subject matter of labour law consists of rules that govern employer-employee relationship. 

A broader perspective however would see labour law as a normative framework for the existence and operation of all the institutions of labour market i.e. Business Enterprise, Trade Unions, employers’ association and state in its capacity as regulator and employer. As Prof. Hepple states, 

“Labour law starts from the idea of subordination of individual worker to capitalist enterprise. That it is above all the law of independent labour (self employed) and it is specific to categories of economic relationships which involve exchange of personal services for remuneration. Labour law is concerned with how the relationships are constituted and regulated.”

Its scope accordingly extends from the individual to collective, from contract of employment to relationships between institutions of organized labour and capital and to conduct and resolutions of conflicts between them.

The intellectual tradition alluded to herein before views labour law as a unified discipline which has outgrown its diverse origin in the law of obligations and in regulating intervention of the state. It is seen as one which spurns the divide between common law and legislation and that between private and public law.

The view that labour law is more than the sum of its parts is derived from writings of German jurists at the turn of 20th century, who saw the subject as embodiment of social policy in action. This view, which at its broadest implies that Labour Law shall embrace sociology, social policy and theory of business organization came to influence the study of Labour Law in Britain in 1930 through the writings of Sir Otto Khan. He was a judge in Weimer in the Republic of Germany.

Sir Otto Khan confronts the conception of Labour Law and stressed the function of interdependence of the positive law with extra-legal resources of regulation in particular collective bargaining. The perspective remains valid today notwithstanding the enormous changes that have taken place in the term and content of Labour Law since Sir Otto Khan elaborated the subject in 1950s.

His writings have impact on scholarship, Courts and formulation of public policy on labour relations on law. Although the notion of labour law as normative framework of institutions in labour market has commanded respect in recent times, other closely related areas of law are important determinants of labour market outcome.

The scope of Labour Law is therefore wide and cuts across traditional groupings of the legal subjects, for instance;

1. Understanding of social security law is important in appreciation of aspects of employment relations e.g. social security contributions on earnings of employee and entitlements of unemployed and those seeking work to receipt of social security benefits.’

2. The same applies to law of taxation which has major impact on employment relationship through the incidence of income tax and also occupational pension rights.

3. It intersects with Company Law for the reason that some awareness of Company Law principles is central to an understanding of legal nature of business enterprise.

4. The Law of Contract which elucidates nature of employer-employee relationship

5. The Law of Tort as it helps to determine liability of Civil wrong doing at work place in the employer-employee relationship.

6. The constitutional law is labour relations are recognised under the Bill of rights at Article 41 as one of the fundamental freedoms.

DISTINCTIVE FEATURES OF LABOUR LAW

With respect to English Labour Law the worker is taken as an individual and taken to contract independently. Over the years that position has been weakened because of eventual growth of employer and employee associations almost to a position of monopoly dominance.

The position of labour unions has grown at the expense of the worker’s individual status and are now recognized as employee associations (individual to collective agreement).

In 18th and 19th Century there was dominance of Laissez Faire policy which was watered down in early 20th century even in the U.K. where it was argued that there should be a strong state intervention in the economy. With the collapse of Soviet Union in 1990s and emergence of Unipolar Republics, 21st Century, illustrates the re-emergence of the Laissez Faire Policy.

In Kenya legal control of labour relations is to be found in the Labour Relations Act of 2007, Labour Institutions Act of 2007 and the Employment Act of 2007.

In Britain, it is adequately covered by a host of statutory provisions and Common Law provisions where Statute is silent. It is for that reason that Brown in his book “British Industrial Relations” while commenting on the Industrial Relations states: 

“When British Industrial Relations are compared to the others they stand out because they are so little neglected by the law.”

AREAS WITHN PRECINCTS OF LABOUR LAW

1. Relationship between employer and employee – employment relationship.

2. Collective bargaining, trade unions and employers’ organisations and the legal effect of collective agreements – collective bargaining.

3. Law concerning strikes, walk outs and industrial conflicts (trade dispute resolutions) – industrial actions.

4. Law about status and membership of trade unions which is intertwined with the Law of Industrial conflicts – membership and status of trade unions.

HISTORICAL BACKGROUND AND DEVELOPMENT OF LABOUR LAW IN KENYA 

The theme historical development of labour law is that of movement from non-intervention to the modern collective bargaining. In Britain there was what Professor Otto Khan Freund describes as a situation of non-intervention by the law in instances of trade unions not employment contracts either.

The reason behind that was that individual employment contracts were not viewed as specialized types of contract but ordinary common law contracts. Collective bargaining was extra legal and was not controlled by statute.  Collective bargaining on employment was not enforceable in law.

In the 19th Century’s first half, judicial legal intervention was equivalent to trade unionism and in that first half, judges declared trade unions and their activities to be criminal.

The enactment of labour statutes of 1859, 1871 and 1875 from which our labour laws are heavily drawn was of some importance in checking that situation. They took away the criminality the judges had attributed to trade unions. Judges belonged to middle-class and so when the law took away the criminal liability, they brought in civil liability. Prof. Khan indeed argues that the courts, until World War I reflected the attitude of the middle class.

At a conference in 1920 of International Labour Organization, Lord Justice Scrutton confirmed that judges belonged to a certain class i.e. employers’ class. Indeed the years following, the statutes removed the criminal liabilities imposed by common law on Trade Unions.

The Courts turned to civil liability. It is much later that it came to be appreciated that the law of a workman to strike was essential for the process of collective bargaining for where statutes fail to create enforcement methods this remains the only self-help method in the hands of employee.

Modern labour relations in Britain:

Regulated by the 4 statutes above-mentioned, legal intervention slowly started emerging from 1859, 1871 and 1875 as supplemented by Industrial Relations Act of 1971 and Trade Unions and Labour Relations Consolidation Act of 1994. Early Common Law was harsh as it provided Criminal sanctions against the worker. The employer was treated as having proprietary rights in his workers. This was explained by feudalist state that existed in England.

The modern law of employment emphasizes the personal revolutionary exchange of freely bargained promises between two parties equally protected by law and that in modern context is emphasized by the existence of legal and statutory provisions of trade unionism and bargaining. 

According to Lord Wedderburn the older common law which emphasized individuality necessarily ignored the economic reality behind it. i.e. employer-employee relationship was indeed such that they were not equal even in their ability to go to law. Lord Wedderburn however, argues that for all archaic qualities, the individual employment contract remains a useful and powerful legal device.

Kenyan case:

In a developed capitalist society, the terms of employment of a labourer are defined by ordinary economic laws of supply and demand i.e. remuneration is defined by the market situation. In the pre-colonial era such terms of labour were unknown.  Generally the position of labour will depend on state of a society at a particular industrial epoch. So that in a feudalist state the worker was not able to bargain because the relationship was that of a “master” and a “slave”.

Before the advent of colonial government in Kenya, Africans lived in a community separated from western world and culture. Their mode of lifestyle was simple, self sustaining and sufficient. At interpersonal and inter-class level, the system was barter. The African mode of communal living was that Africans did not need to work.

Most communities did not have a central political authority except the Buganda and Wanga. It was in those communities where there was employer-employee relationship which was limited to running the body politic. Other communities were non-centralized.

Those are the communities that colonial government found on the ground. The main purpose of settlers was to exploit the natural resources in the economy for production and sale both at home and in colonies. The easiest way was to use African labour. This wasn’t forthcoming because the Africans did not see the need to work. Consequently, the settlers threatened to go back if the colonial government did not secure labour for them. The argument was that colonial authorities had induced them to come and work in the colony.

Espelth Huxley’s book ‘Whiteman’s country’, he thus observed that:

When Lord Delamere set his foot in 1887 in Kenya Queen Victoria was in her thrown and Britain at the height of imperial war. The British quite indeed seemed unassailable and if not immortal certain to endure for centuries. The land to which he came (Lord Delamere) was per European standards primitive. It had scattered people with separate and mainly hostile tribes and who were nomadic and ignorant of the outside world. The intricate social mechanism underlying tribalism that enabled these groups to maintain a stable life were unknown.

When Sir Charles Elliot who was the commissioner from 1900-1903, wrote that Europeans were not destroying any old or existing systems but simply introducing order to a black & brutal barbarism, he was echoing a belief held by all Europeans in the protectorate at that time.

The term settler became a term of abuse projecting attitude of arrogance and brutal individuals who in pursuit of wealth annexed large tracks of land from rightful individuals. They were only after wealth and profits not caring at all about Africans.

With respect to land the only hope for colonial authorities was to fill the ‘empty spaces’ with settlers who would develop the land and other infrastructure. The colonial authority was thus to encourage the settler to move into the region. It also ensured ‘idle’ natives indeed were employed cheaply. It was hoped that wheels of trade had been started by employing natives and therefore supplying among them money to pay for imported goods and taxes.

However African labour was not forthcoming. Two consequences then emerged

1. Recruitment of labour from outside the protectorate

2. To implement legal measures to ensure supply of labour 

With respect to labour, the primary source was India for purposes of construction of the railway line. In respect of legal measures, introduction was made of Colonial Land Ordinance of 1915, Hut tax Regulations of 1901, East Africa Hut Tax Ordinance of 1903, Hut & Poll Tax Ordinance of 1910 & Registration of Natives Ordinance of 1920. Initially when the settlers came, the colonial government had to provide land. The 1915 

Colonial Land Ordinance effectively ex-propriated land from the natives so that Africans quite indeed became mere tenants in their own land at the will of the settlers i.e. labour to work the land. The taking of African land meant creating a landless people who were forced to find other means of subsistence. Some had to sell their labour and a potential labour supply was created.

Land alienation and effects on labour:

The 1902 and 1915 Colonial Land Ordinances facilitated acquisition of land by the settler community and its gross effect was to create a landless group which was for the reason of landlessness compelled to seek alternative means of subsistence in settler farms.

By virtue of 1902 ordinance the doctrine of “vacant land” was applied to alienate land held by African communities on grounds of vacancy. The 1915 ordinance took away all Africans rights in land not taken by 1902 ordinance. The effect of the 1915 ordinance was that all African Land was crown land but could be lawfully alienated by the government. Although provision was made for native Reserves, these were insecure, as they could be cancelled by the government if land was needed by the settlers.

In Wainaina –vs- Murito, CJ Burke declared that native reserves were public land and therefore Africans were termed as tenants at the will of the settlers. The idea of absence of private rights for Africans in land facilitated occupation of that land by settlers. The dislodged Africans were forced to seek means of survival and the settlers were assured a source of cheap labour.

Richard Wolff in his book “Britain in Kenya” states:

“Perhaps the most condemned summary of settlers situation from 1903 and after appeared in a letter from the principal settlers to the governor, a Seidmann and the letter stated ‘we must put on your Excellency that it would be grossly unfair to invite settlers to this country as has been done and give him land under conditions which force him to work and at the same time do away with the foundation on which his enterprise and hope vest namely cheap labour.’”

As early as 1901 the government had passed tax regulations that every adult pays 3 rupees annually for the huts that he and his family occupied. Personal tax/poll tax was also placed. The requirement that tax payment be in monetary terms necessitated movement of natives in search of employment. The argument that tax was meant to supply labour was justified by Prof Ghai. In 1908 the settler community requested the colonial government to force more natives to pay hut taxes so as to enlarge supply of labour (Bracket of persons liable to pay tax expansion is called tax base expansion).

In 1910 Hut and Poll Tax Ordinance was passed empowering the government to impose tax on a wider tax base hence forcing more Africans to go into labour market. Those who failed to pay tax were rounded-up and forced to supply labour in white farms without payment. A 15 year old was deemed an adult per that 1910 ordinance.

That did not solve the problem of labour. The Africans only worked enough to pay tax and go back to their lifestyles. The colonial government changed style of taxation so that tax would be collected during peak periods e.g. harvesting period.

Other than those direct modes of tax imposition there was forced labour but imperial government was reluctant to sanction forced labour due to connotation of slavery that had been abolished. Land was useless unless sufficient labour was supplied. The success of British industry depended on availability of raw materials in the colonies. To the settler community the colonial government had a duty to protect that industry.

In that going there was labour crisis between 1907 and 1909. In 1912 a labour commission was appointed to look into labour situation. African interests were not represented in that commission.

Labour crisis of 1907 to 1909:

The year 1908 marked the peak of settlement wave. The rise in white settlement brought them problems, labour problems being the greatest. Settler farmers found it difficult to get enough labour since there were about 2.5 million natives compared to about 1,000 settlers. The labour crisis was not due to lack of able-bodied persons but due to the fact that an average native did not need to work for Europeans.

The basic questions that arose from the crisis were; how far was the colonial government responsible for providing labour to enhance settler agricultural sector? How was the government justified in persuading natives to work for settlers and what steps if any were to be taken to encourage them to do so? In the authorities’ view, the issue was one of economies. They argued that if settlers could not get labour they could induce. To them labour variable was African labour not white labour.

The role of the settler was seen as that of a supervisor, manager and skilled expert. They also argued that natives could not produce for the market. They took the position that, if the country was to have European production so as to have economic balance, the government had a duty to induce onward development by persuading Africans to work for settlers. The government, it was argued, had the obligation to farmers because it had invited the settlers to come into the colony and sink their capital and that the colonial government had undertaken to provide them with land but the land was of no value without labour force.

Between 1907 and 1909 there was a labour crisis which was compounded by the fact that state institutions had been directed from London that government officers should not participate in recruiting labour. That was to be left for recruiters. There was no communication between recruiters and thus it became impossible to relate between the forces of demand and supply.

That dilemma is captured by the letter to colonial government by labour commission which stated in part:

‘We recognize that forced labour cannot be carried on, but to advertise to natives not to work if they wish, to the savage mind is a broad hint not to work.’

The labour commission of 1912 called evidence from settlers in exclusion of the Africans. Its recommendations on how to resolve labour problems are summarized by Prof. Okoth Ogendo in ‘Tenants for the Crown’ as follows:

1. A property tax imposed on all natives, be calculated on an estimate of which each cultivates or value of stock, for agricultural and pastoral communities respectively.

2. District commissioners be sent clear circulars directing them to assist in recruitment of labour and if possible centres be set up all over the country to coordinate the supply and distribution of labour.

3. Natives be allowed to squat with their families in European land in exchange of labour.

The recommendations were not accepted in total by the government. The government proposed an alternative method that would facilitate availing of information on where labour could be obtained and where jobs were available. This was not a neutral position as the government would have liked it to be viewed. This is because in the process of availing information certain administrative units were used in labour recruitment specifically headmen and chiefs. It was the use of these people that forced labour emerged in this country.

With respect to legal measures taken, other than Crown Land Ordinance, there are instructive ordinances;

1. Registration of Natives Ordinance of 1920 - The first registration ordinance was promulgated in 1915 which required registration of natives who had come forward for employment. The 1920 ordinance was to control native movement and ensure labour control. The first ordinance facilitated process the second one controlled the process. The 1915 never came into force as notice had never been issued.

In 1919, the settlers held a meeting calling for the implementation of the 1915 ordinance in a manner that would ensure continuous labour availability. It was in line with this demand that the government promulgated the 1920 ordinance with respect to ensuring continuous supply of labour. It dealt with the problem of dissertation of labour. The ordinance sought to address this required a native be registered and issued with a registration certificate (kipande system).

The ordinance was of importance to the settler community because Africans lingered in their traditional way of life. After paying tax they went away. In terms of the ordinance, dissertation of labour became a criminal offence purnishable by heavy fines and imprisonment - this was cruel.

2. The second ordinance was Residents Native Ordinance of 1916 which was aimed at supplementing the 1915 registration ordinance and to expedite flow of labour from native areas to farm land as well as to industries.

The ordinance established and catered for settler-squatter relationship. Natives on employment became squatters on settler farms. The ordinance spelt out terms of relationship and ensured that the settlers got labour and retained it. The native got a place on settler land to build and cultivate and was required to supply labour in return i.e. master-servant relationship in feudalist societies.

Africans were expected to supply labour for six months a year and in return got land. Despite all that, even if registration ordinance and native ordinance secured labour, they did not secure sufficient labour. In the WWI the government was persuaded to take more drastic actions to recruit labour.

In 1919 the Ainsworth circulars were issued. The first dated 23rd October 1919 recommended PCs, DCs and Native authorities, that it was their duty to influence labourers to turn up for work in settler farms. It issued further instructions to the effect.

1. Government officials must exercise every lawful influence to induce able bodied persons to do labour in the field;

2. Native Chiefs and Elders must render possible assistance on the foregoing light.

3. DCs should organize labour recruitment meetings to which employers must be invited and where amount, place, nature and payment of labour required was to be explained.

4. Administrators must permit employers, to enter freely any native reserve to get chiefs, headmen and native authorities for recruitment of labour.

Though the circular was withdrawn later, Prof Okoth argues that forced labour continued up to 1939. The cumulative effect of the circular, coupled with tax collection was not simply flow of labour into European farms but in 1920s a steady and increasingly by importance of badly needed revenue especially now that the Europeans had resisted direct taxation.

Due to the connotations of forced labour that the circulars had, African population protested against them but they were accepted by the colonial government. The church or missionaries did not in principle oppose these circulars.

Archbishop Deacon Owen was a strong advocate of this approach saying that compulsory labour should be used for at least 10 years to develop Africa. The sympathizers the natives had were outsiders, mostly the labour office in Britain. The labour party in Britain opposed these circulars seeing them as an attempt to reintroduce slavery. Legislation followed to implement the circulars e.g. the Native Authority Ordinance of 1921 was enacted to empower headmen to order natives to do compulsory labour in public works. This was invariably so when they failed to turn up for work in European farms. The argument was that if natives were forced to do public work unpaid, it would encourage them to go for paid work. The result was that by 1930 African labour was flowing into desired areas.

It is the development of the native working class that the British government imported the British labour laws which is a heavy reflection of the labour relations statutes of 1859, 1871 and 1875.

2. SOURCES AND INSTITUTIONS OF LABOUR LAW

SOURCES OF LABOUR LAW

1. Constitution of Kenya, 2010

Article 41 deals with labour relations. Under Article 41(1), every person has the right to fair labour practices. Under Article 41(2) every worker has the right to:

• Fair remuneration

• Reasonable working conditions

• Form, join or participate in a Trade Union

• Go on strike

Under Article 41(3) every employer has a right to:

• Form and join employers’ organisation;

• Participate in an employers’ organisation.

Under Article 41(4) every Trade Union and Employers’ Organisation has the right to:

• Determine its own administration, programmes and activities;

• Organise,

• Form and join a federation.

Under Article 41(5) every Trade Union, Employers’ Organisation and employer has the right to engage in collective bargaining. 

Under Article 162(2) (a): Parliament shall establish courts with the status of the High Court to hear and determine disputes relating to employment and labour relations. 

2. Legislation 

This is the law laid down by an organ of the state which has power to do so i.e. Parliament {the laws are in writing and known as statutes or acts}. There is a large variety of laws (more than 20) dealing with labour matters. The nine (9) core labour legislations are;

1. Industrial Court Act no. 20 of 2011

The Act establishes the Industrial Court as a superior court of record pursuant to article 162(2) (a) of the constitution. At s. 12, the Act confers jurisdiction on the court with respect to employment and labour relations. The principal objective of the Act is to facilitate the just, expeditious and proportionate resolution of disputes governed by the Act 

2. Employment Act, 2007 (replaced Employment Act, Cap 226 and Regulation of Wages and Conditions of Employment Act, Cap 229)

The Act declares and defines the fundamental rights and obligations of employees; Employment relationship (nature and types of employment);  provides the basic conditions of employment for employees; Employment separation(termination, resignation, dismissal, redundancy, retirement, death) and benefits upon termination; Regulates employment of children including protection of children from the worst forms of child labour, minimum age of employment and prosecution for contravention; Provides the basic terms applicable to all employment contracts;  Insolvency, employment records and employment management; dispute settlement procedure and General principles on;

• prohibition against forced labour 

• discrimination in employment

• sexual harassment (20 or more employees)

The Act applies to all employees employed by an employer under a contract of service. It however does not apply to:

• The Defence Forces.

• National Police Service & Kenya Prisons Service.

• National Youth Service.

• An employer and employer’s dependants where the dependants are the only employees in a family undertaking. 

3. Labour Institutions Act, 2007

The Act establishes various labour institutions. It provides for their functions, powers and duties. It provides for the creation and management of all institutions dealing with labour including; 

• The National Labour Board

• Industrial Court

• Committee of Inquiry

• Appointment of Commissioner for Labour, Director of Employment, Registrar  and Deputy Registrars of Industrial Court and  Registrar of Trade Unions

• Wages Councils and wages orders

The Act does not apply to:

• The Defence Forces.

• National Police Service & Kenya Prisons Service.

• National Youth Service. 

4. Labour Relations Act, 2007 (replaced the Trade Unions Act, Chapter 233 and the Trade Disputes Act, Chapter 234)

The Act provides for registration, regulation, management and democratisation of Trade Unions and Employer Organisations. It promotes sound labour relations through protection and promotion of freedom of association, encouragement of effective collective bargaining and promotion of expeditious dispute settlement. It provides for freedom of association for both employers and workers, provides for the formation, regulation and dissolution of trade unions, employers’ organizations and federations

It provides for collection of union dues including agency fees, and subscriptions for employers’ organizations; recognition of trade unions and Collective bargaining; dispute resolution and adjudication at the parties own level, Ministry of labour, Industrial Court and ADR; it provides for strikes and lockouts, including prohibited strikes and lockouts, Essential services (water supply services, hospital services, air traffic control services, civil aviation telecommunication services, fire services of the Government and public institutions, ports authority  and local Government authorities, ferry services); Powers of industrial court to deal with urgent applications (recognition, redundancy without notice, essential services)

5. Work Injury Benefits Act, 2007 (replaced the Workmen’s Compensation Act, Chapter 236)

The Act provides for compensation to employees for work related injuries and diseases contracted in the course of their employment. It provides for compensation of all employees for work related injury or occupational diseases. It provides for registration of employers and insurance of all employees against work related injury or occupational diseases, including medical treatment, appliances and travel expenses (recovery of medical expenses prohibited). It provides for compensation of employees for occupational accidents or diseases resulting in disablement or death.

Provides for denial of compensation in the case of; 

• injury due to deliberate and willful misconduct(unless injury is serious - causing more than 40%  disability or death)

• employee willfully fails to disclose a medical condition that aggravates injury or disease. Employee fails to present himself for medical treatment.

It provides that an employee should not be denied compensation by threats; Compensation not to be alienated, Maximum compensation to be based on 96 months earnings; temporary disability up to 12 months; payment of compensation to Director within 90days from date of assessment and to injured employee or dependants within 30 days.

6. Occupational Safety & Health Act, 2007 (replaced the Factories and Other Places of Work Act, Chapter 514)

The Act provides for the safety, health and welfare of workers and all persons lawfully present at workplaces. It establishes the National Council for Occupational Safety & Health. The Act applies in any place where a person is at work. The purpose of the Act is to:

• Secure the safety, health and welfare of persons at work

• Protect persons other than persons at work from risks arising out of  the activities of persons at work

It provides for duties of occupiers (who include employers) workers, self employed people, suppliers, designers, importers, manufacturers. It makes special provisions for health and welfare of workers, machinery and chemical and safety.

7. National Social Security Fund (NSSF) Act Cap. 258

It establishes the NSSF as a compulsory contributory social security scheme. It provides for:

1. Age benefits

2. Withdrawal benefits

3. Invalidity benefits

4. Survivors’ benefits

5. Emigration grants

8. National Hospital Insurance Fund (NHIF) Act Cap. 255

The Act establishes the NHIF, as an insurance fund which:

1. Caters for medical insurance

2. Pays for expenses incurred by a contributor, and his or her spouse and dependant children.

9. Retirement Benefits Act

The Act establishes a Retirement Benefits Authority for the regulation, supervision and promotion of retirement benefits schemes, the development of the retirement benefits sector and for connected purposes.

3. International Labour Laws

The international laws are applicable by virtue of article 2(5) and (6) of the Constitution of Kenya. By way of various conventions, the laws provide for abolition of forced labour, protection of freedom of association, organisation and collective bargaining, prescribe the minimum employment age provide for protection from the worst forms of child labour and provide for non-discrimination in employment. 

The core International Labour Organisations (ILO) conventions are the following;

• ILO Con. 29 – on Forced labour ratified on 13th January 1964

• ILO Con. 98 – on Freedom of Association and Collective Bargaining ratified on 13th January 1964

• ILO Con. 100 – on Equal remuneration for work of equal value ratified on 7th May  2001

• ILO Con. 105 – on Abolition of forced labour ratified on 13th May 2001

• ILO Con 111 – on Discrimination in employment ratified on 7th May 2001

• ILO Con. 138 – Minimum age of employment ratified on 9th April 1979

• ILO Con. 182 – Worst forms of child labour ratified on 7th May 2001

Apart from the above the review exercise incorporated a number of ILO standards and conventions relating to human rights.

4. Judicial precedent 

These are the court decisions. The previous court judgements constitute precedents that courts must follow; only ratio decidendi (reason for judgement) creates precedent.

5. Common law

This is the law which is not legislation. It is the law based on the ancient customs of the English people. 

6. Custom 

Though playing a limited role it is critical.

7. legal writing 

The views of legal authors are not binding but persuasive to courts.

Review of its labour legislation from 2007 by Kenya;

New legislation consisting of five pieces of statutes were enacted by parliament in 2007. The new legislation consisted of;

• Employment Act, 2007

• Labour Institutions Act, 2007

• Labour Relations Act, 2007

• Work Injury Benefits Act, 2007

• Occupational Safety and Health Act, 2007

Objectives of labour law review;

The objective of the review was to;

• Domesticate ILO conventions ratified by Kenya in fulfillment of the country’s obligation as a member of the ILO.  

• Ensure that the eight (8) core ILO conventions are adopted within the new labour laws. 

• Ensure employment legislations are more user friendly.

• Harmonize E. Africa Regional Labour Legislation in readiness for the common market.

INSTITUTIONS OF LABOUR LAW

1. Industrial Court

In pursuance of Article 162(2) of the constitution, the Industrial Court Act at s.4 establishes the industrial court. It is a superior court of record having the status of the High Court. It has and exercises jurisdiction throughout Kenya.

The court consists of;

• The Principal Judge; and

• Such number of judges as the President may, acting on the recommendations of the JSC appoint.

The PJ is elected by the judges of the court from amongst themselves in accordance with article 165(2) Constitution. The PJ holds office for a term of not more than5 years and is eligible for re-election for one further term. The PJ has supervisory powers over the court and is answerable to the CJ. 

Qualifications for appointment as a judge are as follows;

• 10 years experience as a superior court judge or professionally qualified magistrate; or

• 10 years experience as distinguished academic or legal practitioner with considerable knowledge and experience in the law and practice of employment and labour relations in Kenya. 

The court has exclusive original and appellate jurisdiction to hear and determine disputes referred to it in accordance with article 162(2) of the Constitution, the Industrial Court Act and any other law that extends jurisdiction to the court relating to employment and labour relations.

• Grace Muriithi v. Kenya Literature Bureau (2012).

• USIU v. Attorney-General (2012).

• Anne Muguiyi v. NIC Bank (2012).

• Trusted Society of Human Rights Alliance v. Nakuru Water Company (2013).

See:

• Sec 12(1): matters that the court has jurisdiction over.

• Sec 12(2): persons/bodies who may be parties in the court

• Sec 12(3): orders that the court may make.

• Sec 15: empowering the court to encourage ADR. 

• Sec 17: Appeals from its decisions lie to the Court of Appeal.

• Sec 18: The court has appellate jurisdiction over:

• Decisions of the Registrar of Trade Unions.

• Any other court, tribunal or commission as prescribed under any written law

2. National Labour Board

Established under Sec 5(1) of the Labour Institutions Act.

See:

• Sec 6 LIA: composition of the Board who must be Kenyan citizens.

• Sec 7(1) LIA: functions of the Board. Which are to advice the Cabinet Secretary on the matters set out in it. 

• Sec 7(2) LIA: Commissioner of Labour (as Secretary of the Board), to brief the Board every 3 months on the matters set out in it

3. Committee of Inquiry

In relation to the Labour Institutions Act see:

• Sec 28: Gives the Cabinet Secretary the power to appoint a Committee of Inquiry to inquire into any matter which appears to the CS to be connected with or relevant to any trade dispute whether or not the dispute has been reported to the CS.

• A CoI consists of 3 or more persons as the CS deems fit to appoint

• A CoI inquires into and reports on any matter referred to it under Sec 28 and submits a report on the matter to the CS. 

4. Labour Administration & Inspection

In relation to the Labour Institutions Act, the CS is vested with powers to appoint certain officers for the due administration and inspection of labour. These include:

• Commissioner of Labour: Sec 30(1)(a).

• Director of Employment: Sec 30(1)(b).

• Such officers as may be necessary for administration of laws relating to labour and employment: Sec 30(1)(c).

• Registrar of TU: Sec 31 

5. Wages Councils

In relation to the Labour Institutions Act see:

• Sec 43: The CS shall establish:

• A general wages council.

• An agricultural wages council.

• Sec 44: Functions of WCs;

• Investigate remuneration and conditions of employment in any sector.

• Invite and consider written and oral representations from interested parties.

• Make recommendations to the CS on minimum wage remuneration and conditions of employment. 

6. Employment Agencies

In relation to the Labour Institutions Act see:

• Sec 3 LIA: any person, company, institution, agency or other organization which acts as an intermediary for the purpose of procuring employment for a worker.

• Sec 55: employment agencies must be registered with Director of Employment. 

• Sec 53: employment agencies must keep records of their transactions for at least 3 years after occurrence.

7. National Council for Occupational Safety & Health

In relation to Occupational Safety and Health Act, 2007, s.27 establishes the above council whose functions: 

• the formulation and development of national occupational safety and health, policy framework; 

• make legislative proposals on occupational safety and health, including ways and means to give effect to ILO Conventions, and other international conventions and instruments relating to occupational safety, health, compensation and rehabilitation services;

• develop strategic means of promoting the best practices in occupational safety and health;

• the establishment, maintenance and development of a safety and health preventative culture; 

• the reviewing of the provisions of this Act, rules and regulations, standards and industry codes of practice; 

• the statistical analysis of work related deaths and injuries; and 

• such other matters affecting occupational safety and health as it considers desirable in the interest of improving the quality of working life in Kenya.

3.0 Employment relationship 

TERMS OF EMPLOYMENT; EMPLOYMENT CONTRACT

The concept of voluntary consent to enter a valid contract of employment is prevalent under common law, based on the freedom of contract as evolved by Courts in the 19th century. It was presumed that such contracts were entered into by equals who have negotiated freely. However practically parties to employment contracts are not equals hence there has been statutory intervention in employment matters. The general rule of English Law is that employment contracts need not be in writing. All that was needed was an agreement to do a particular job in return for a specified amount of money.

Agreement may be reached by word of mouth or in writing or entered from conduct e.g. an employee who stays on after changes in his work may be deemed to accept those changes unless he can prove complains or other convincing evidence to the contrary. However, as flows from logic, from the law of evidence, it should be clear that the best proof of employment is documentary evidence without such documentary evidence of agreement only one party’s word against the other is useful in deciding any issue in dispute.

It is for that reason that in industry and commerce it has been the practice for many years to cover some of the conditions of employment in written terms. In the last three decades the law in England has made many exceptions to the general rule that writing is not necessary. The most substantial requirements as to writing are to be found in Sections 1-11 of Employment Protection (Consolidation) [EPCA] Act 1978 as amended in 1983. The effect of the provisions is to ensure that employees have a reasonable degree of certainty as to the terms of employment. There seems to arise doubts and disputes over this crucial question.

In Kenya, the Employment Act regulates individual employment law. The Act does not replace but supplements common law. The effect of S.9 of the Act is that all contracts of employment except those whose duration is for less than an aggregate of 3 months must be in writing. The responsibility for writing of contract is on the employer and the act at s. 10 specifies the period within which the contract must be reduced into writing as two months from the date when the employment begins.

The position in law is that the contract must set out the terms of contract between the parties and at common law the contract was referred to as a “written statement.” The contract is intended only as a record of particulars required under the Employment Act. 

However under s.10(2) certain terms must be specified. They include the following:-

1. the name, age, permanent address and sex of the employee;

2. the job description of the employment;

3. the date of commencement of the employment;

4. the form and duration of the contract;

5. the place of work;

6. the hours of work;

7. the remuneration, scale or rate of remuneration, the method of calculating that remuneration and details of any other benefits;

8. the intervals at which remuneration is paid; and 

9. the date on which the employee’s period of continuous employment began, taking into account any employment with a previous employer which counts towards that period; and

10. any other prescribed matter.

In supplementary documents such as terms of service statement the following should be set out:- 

1. entitlement to annual leave, including public holidays, and holiday pay, (the particulars given being sufficient to enable the employee’s entitlement, including any entitlement to accrued holiday pay on the termination of employment, to be precisely calculated);

2. incapacity to work due to sickness or injury, including any provision for sick pay; and

3. pensions and pension schemes,

4. the length of notice which the employee is obliged to give and entitled to receive to terminate his contract of employment;

5. where the employment is not intended to be for an indefinite period, the period for which it is expected to continue or, if it is for a fixed term, the date when it is to end;

6. either the place of work or, where the employee is required or permitted to work at various places, an indication of that place of work and of the address of the employer;

7. any collective agreements which directly affect the terms and conditions of the employment including, where the employer is not a party, the person by whom they were made;

8. where the employee is required to work outside Kenya for a period of more than one month— the statement should show:

• the period for which that employee is to work outside Kenya;

• the currency in which remuneration is to be paid while that employee is working outside Kenya;

• any additional remuneration payable to the employee, and any benefits due to the employee by reason of the employee working outside Kenya; and

• any terms and conditions relating to the employee’s return to Kenya.

9. the disciplinary rules and procedures applicable to the employee if the employer has employed more than 50 employees – see. S. 12.

The assumption at common law with respect to contract of employment was that parties were equals and that there was negotiation before the employment. In practice however, more often than not there are never any negotiations and more often parties are not equals. The dominant practice is that of standard contracts where the employee merely signs to signify consent. Equal bargaining power does not exist in the field of individual employment.

The only way in which that imbalance is ameliorated is through collective bargaining by trade unions. The contract of employment creates rights and duties between employer and employee. For that reason, any term in a contract of employment must be firm and unequivocal so that if one accepts a term of employment subject to conditions no contract of employment arises.

In Loft –vs- Roberts (1902) AC 40 it was thus held:

That all terms must be ascertained or ascertainable. If not it cannot constitute a term of contract as such terms are supposed to create rights and duties which must be known or capable of being ascertained.

Where the terms of contract can be ascertained from conduct, regular and easily ascertainable conduct must be shown. Certain terms if not expressly provided for in contract are implied in the contract of employment. This is to safeguard the employees’ weak position in the relationship and arrest instances in which employer fails to take into account employee’s interests.

The employer is obliged under s. 13 to notify the employee of any change in terms and conditions of employment. This doesn’t mean that employer has the right to vary terms unilaterally. There is only one exception to this i.e. where such variation improves terms of employment of employee.

RIGHTS AND DUTIES OF THE EMPLOYER AND THE EMPLOYEE

Discussions on this will be from the points of duties.

DUTIES OF EMPLOYER

They are set out under Statute and Common Law and include the following:

1. Accord employee respect or act in good faith to employee.

2. To remunerate employee

3. To indemnify employee for any expenses incurred by employee in the course of duty

4. To employ safety of employee at work

5. To provide work

6. To provide a weekly rest-day

7. To make provisions for leave 

8. To make provisions for maternity and paternity leave 

9. To make provisions for sick leave 

10. To make provisions for housing

11. To provide wholesome water at work place

12. Where expressly agreed, to provide food at the work place

13. To make provisions for medical attention 

1. Respect:

This is a mutual duty required to continue for so long as contract of employment exists. For so long the common law was reluctant to impose any significant duties on employers except in regard to safety. In recent time however there have been some changes reflecting societal change in reflections and expectations. In Wilson –vs- Racher (1974) ICR 428 Edmond Davies –LJ- opined

“We have by now come to realize that a contract of service imposes upon the parties a duty of mutual respect. It is now accepted that employers must act in good faith towards employees so that for instance an employer’s arbitrary expression of his contractual duties or unilateral changes in the most basic terms of employment have led on occasions to liability on unfair dismissal.” 

This has occurred in instances where employer expressly requires employee to resign or face dismissal or when he changes the terms and conditions of employment in some fundamental way which leaves an employee with no chance but to resign. This is traceable in the case of Gerishon Majanja –vs- Caltex Oil Ltd. Demotion unless resulting from misconduct may as well have that effect (unfair dismissal)

In Western Excavating (ECC) Ltd –vs- Sharp (1978) QB 761, it was held that for liability to arise, evidence is needed that the employer is guilty of conduct which shows that he did not intend to be bound by one or more initial terms of contract. The essential terms are said to include the essential terms that employer will not seek to destroy the parties mutual trust and confidence for instance by constantly changing essential terms to his/her detriment.

Threatening to dismiss an employee if he/she does not accept such changes is also within the rule. In United Bank Ltd –vs- Akhtar (1989) IRLR 507, the employee worked in Leeds under a contract which entitled the bank to move him anywhere in the country. He was officially told on a Friday that he was to begin working on the following Monday in Birmingham. His request for more time for urgent family reasons was rejected and his pay was stopped. He resigned and sued. The problem facing the tribunal was that the bank seemed to be within its contractual rights to order him to move. But his claim was upheld for the reason that there was an implied term, that he would be given reasonable notice, breach of which brought the bank within the Western Excavating rule and that the bank’s conduct was simply unreasonable and in breach of duty of mutual respect.

This was also the result in the case of Warner –vs- Barbers Stores (1978) IRLR 109 where employer refused to give employee time off to tend domestic crisis. 

The recent developments indicate that the duty has been invoked in instances of sexual harassment at work. In the case of Insitu Cleaning Co Ltd –vs- Heads (1995) IRLR 4 A manager’s greeting in these terms, “hi you big tits”, to a female employee twice his age was held an act of gross indecency and breach of duty to respect employee. 

 

2. Remuneration:

An employer is under duty to pay salary and wages even if he does not provide any work. The worker’s right to payment depends on the express or implied terms of the contract. This point was emphasized in the case of Devonald –vs- Rosser & Sons (1906) 2 KB 728

The only exceptions to this rule are: 

1. If under contract of employment it is an express or implied term that when there is no work the employee will not be paid. 

2. There is reasonable, certain and notorious custom that when there is no work to be done the employee is not paid. 

S. 17-18 Employment Act: spells out the duties of an employer with respect to remuneration. S.17 provides that remuneration must be paid to an employee directly and in a Kenyan currency which payment must be made on a working day and must not be made where intoxicating liquor is sold or readily available. 

S.18 provides when payment must be made: In case of a casual employee, he must be paid at the end of the day. For a person employed for more than one day but less than one month, he must be paid at the end of that period. For a person employed for one month remuneration is at the end of the month. 

3. Indemnifying an employee:

Usually there is an express agreement and where there is none, it is implied that the employer will reimburse the employee any money reasonably incurred in the course of employment. The employee must however have authority to do so and is reimbursed such amount as is expended in course of employment.

4. Safety at work:

This is the most extensive employer’s duty and is imposed by legislation and common law. Breach can result in suits in negligence by employee or can attract Criminal liability under relevant statutes (Occupational Safety and Health Act 2007). The duty to ensure personal safety of employees is part of duty of care. It is intended to ensure that employees are provided with a safe working environment and that they are compensated for any injuries sustained in the course of employment. 

Subject to the tests in law of tort relating to negligence the duty of care can and actually is threefold: 

1. Provide safe plants and appliances, so that all equipment must be safe.

2. Provide a safe system of work i.e. all factors which concern manner in which work is to be done must constitute a safe work place e.g. layout of plant like fire escapes in industry, warnings like fire alarm and protective clothing in factories. 

3. To engage reasonably competent employees so as to ensure safety of fellow employees. 

With respect to safety at work Swanwich –J- in the case of Stokes –vs- Guest Keen & Nettleford (1968) 1 ELR 1976 observed as follows: 

1. That positive steps must be taken to ensure safety in light of available knowledge

2. Employer should follow current recognized practices relating to safety.

3. Where there is developing knowledge with respect to safety, the employer must keep a breast with respect of such knowledge. 

4. If employer has greater than average knowledge of the risk, he must take more than average precaution. 

In terms of S.10 of the Work Injury Benefits Act, in case of death or serious permanent incapacity, an employee is entitled to compensation whether or not he was in contravention of statutory provisions or contract of service, so long as death or injury arose while in course of doing his work. 

5. Provision of work:

Once employed an employee has a right to work. This implies that at a broad level a right not to be discriminated at work place on any ground. The question arises - is the employer obliged to provide work? 

The question was addressed in the case of Langston –vs- AUEW (1974) 1 All ER 180. Mr. Langston was a skilled man who had been a union member for many years and at some point a shop steward. He disapproved of the “closed shop principle” i.e. to work in an industry you must belong to a certain Trade Union. The Union sort to have employer get rid of him. The Employer had no quarrel with him personally and did not wish to have himself held liable for compensation for “unfair dismissal”. They suspended him on full pay. Langston argued that, by suspending him, the employer had breached his contractual obligation to provide him with work. Lord Denning held: employee had a right to work and should be given opportunity to work when available and is ready to do it. 

On a general principle no such right exists. For instance as the Court observed in Collier –vs- Sundry Referee Publishing Co. (1940) 2 KB 647 - ‘provided I pay my cook her wages regularly she cannot complain if I choose to take my meals outside.’ 

If there is a right to work so as to create a duty it may be no more than a right to seek injunction against arbitrary discrimination at the work place and perhaps when the worker may be excluded from his occupation. So that unless an employer has bound himself to provide work, he cannot be liable for failing to provide work as it would be tantamount to performing a miracle. 

In Felix Marete Njagi –vs- A-G, HC Misc Civil Application No. 688 of 1986 (Unrptd) the labour question descended from a constitutional point of view. Marete was denied his salary for 2½ years for allegedly being involved in activities disrupting public interest. He was not formally dismissed but had no pay. 

The Court had no difficulty in finding that subjecting a person to a period of 2½ years without work and pay and freedom to seek alternative employment amounted to mental torture and therefore inhuman and degrading treatment contrary to S.74 of the Constitution (as it then was). 

6. Weekly rest:

S.27 of the Employment Act obliges employers to provide employee with a day of rest in every working week. 

7. Provisions for leave:

S.28 Employment Act, enjoins employers to give employee annual leave with full pay. S.28 (1) (a) an employee is entitled to leave of not less than 21 days after every 12 consecutive months of service.

8. Provisions for Maternity and Paternity leave:

S.29 (1) Employment Act, enjoins employers to give a female employee three months maternity leave with full pay.

S.29 (8) Employment Act, enjoins employers to give a male employee two weeks paternity leave with full pay.

9. Provisions for sick leave:

Under s. 30 (1) After two consecutive months of service with his employer, an employee is be entitled to sick leave of not less than seven days with full pay and thereafter to sick leave of seven days with half pay, in each period of twelve consecutive months of service, subject to production by the employee of a certificate of incapacity to work signed by a duly qualified medical practitioner or a person acting on the practitioner’s behalf in charge of a dispensary or medical aid center.

10. Housing:

Under S. 31 an employer is under duty at his expense to provide reasonable housing to his employees where he does not do so, he can pay his employee house allowance.  

11. Wholesome water:

S. 32 requires provision of sufficient supply of wholesome water for the use by the employees at the work place. 

12. Food:

Under S. 33 where there is express agreement, the employer must ensure employees are properly fed and provided with sufficient cooking utensils and proper means of cooking. 

13. Medical attention:

Under S. 34 (1) an employer shall ensure the provision of sufficient and proper medicine for his employees during illness and if possible, medical attendance during serious illness.

DUTIES OF EMPLOYEE

These are not spelt out in any statute. Employees are surrounded by duties spelt out in contracts of employment and Common law. Judges had in the past to lay out standards of behaviour expected of an employee when deciding whether an employer was entitled to summarily dismiss an employee, sue him for damages or deduct his pay for any losses occasioned to the employer. 

The duties are: Obedience, Competence, Care and Good faith. In England the position has changed so that certain duties are statutory under the Employment Protection (Consolidation) Act).

1. Obedience:

Courts deem contracts of employment as contracts where one party gives orders and the other obeys. Wilful refusal to obey lawful and reasonable orders is a breach of contract which may jeopardize one’s employment or give liability to damages. Wilful refusal connotes intentional repudiation of authority which makes it difficult for employment relationship to continue. Such refusal may be oral or by conduct so that a worker is strictly liable for consequences of his disobedience. 

Abuse or rudeness by employee may amount to repudiation of employer’s authority. A great deal depends on the words used and accepted level of give and take in the circumstances. In Reaper –vs- Webb (1969) 2 All ER 216 a gardener told to put in some plants shortly before the end of the day refused to do so and informed his employer that he could not care less about “your bloody green house and your sodden garden.” It was held particularly in view of previous complains about the gardener’s insolence, that this behaviour may make continuance of that relationship impossible and his summary dismissal was justified. 

In Wilson –vs- Racher (1974) ICR 428 the Court held that a single outburst of bad temper will not usually be enough to end contract usually if the employee was provoked. 

In Laws –vs- London Chronicle (1949)2 All ER 283 the Court decided that disobedience arising out of inadvertence or misunderstanding would not suffice to terminate contract.

The Employee is allowed to disobey orders which are unlawful or unreasonable. This arises where employee is asked to do something he was not called in to do. Essentially this is breach of contract and is unlawful. Whether an order has the effect of being unlawful depends on how the employee’s contract was written out. Hence, the importance of written job specification in the contract of employment. In absence of such specifications, custom and practice may help in defining employee’s job specification. An employee is bound to take such duties as are reasonably incidental to those expressly agreed. 

In Gourse –vs- Durham County Council (1972) All ER held: that school teacher’s duties extended beyond classroom teaching and in absence of anything to the contrary extended to supervision of students at meal time. 

2. Competence:

The law expects an employee to do with reasonable proficiency the job he has intimated or is employed to do and for which he has implied to do. To justify dismissal, an employer must show employee’s incompetence has or would cause material loss or in some important respect the employee fails to meet requirements of his job.

In Jackson –vs- Invicta (1987) 2 All ER 301 Held: employer could only escape liability for wrongful summary dismissal if he could prove a degree of incompetence so great as to make it impractical to keep employee on job. 

3. Duty of care:

In Superlux –vs- Plaisted (958) 1 All ER Court Held: that an employee must take care of his employer’s goods and interests as if they were his own.  A commercial traveller was held liable in damages because he did not take care of employer’s goods out of the van in which he was travelling into his house which in the circumstances would have been inconvenient but safer than leaving them in the van from which they were stolen. 

This is a high standard and arguably unjustifiable given that there is no corresponding duty on employer to safeguard employees goods and interests. In Edwards –vs- West Hertsfoshire Grp Hospital Management Committee (1971) All ER the court decided that there is no corresponding duty on employer to take care of employees goods. 

The employer will need to show some material loss or damage before exercising the right to claim material damage. In Jalater Bank –vs- Ahmed (1981) IRLR a branch manager of the plaintiff bank was held liable in damages for not making proper inquiries about credit worthiness of certain customers as a result of which they defrauded the bank large sums of money. 

Careless must be judged in the light of what may fairly be expected from an employee. Higher standards may be expected from professional experts e.g. doctors, engineers etc. 

It is also a factor to be considered whether the loss is caused partly by fault of an employer e.g. failing to provide instructions or supervision so that the fault will accordingly reduce the claim of employer. 

4. Duty to act in good faith:

Common law requires employees do their work with honesty and integrity and to avoid situations where their financial or other interests are incompatible with those of the employer. Certain conflicts of interests are unavoidable in labour relations. It is for that reason that demands for pay rise and threats of strikes are not regarded as breach of duty to act in good faith. Duty case is set out in negative terms of not to steal or reveal trade secrets. 

A question arises as to what are minimum obligations of this duty. Some useful guidelines were spelt out in Secretary of State for Employment –vs- A.S.L.E.F (1972) S.E.R 19 the case arose in Industrial Relations Court to order a ballot or cooling off period in event of a strike or irregular industrial action short of a strike which threatens national economy. Irregular industrial action was described as interference with the supply of goods and services by a group of workers some or all of whom were in breach of their employment contracts. The secretary applied to Court for a ballot order because rail men were working against the rule of acting irregularly. The problem before the Court was whether, the men who claim to be following employer’s instruction could at the same time be breaching employment contract? 

Lord Denning stated that in construing, the following must be borne in mind: The rules must be construed reasonably. They must be construed in usual dealing and the way they have been applied in practice. In his view when rules were so construed the railway rules could work effectively and efficiently. He thus stated “If some of those rules were construed unreasonably the system was in danger of being disrupted. It is only when they have construed unreasonably that the system grounds to a halt. It is a clear breach of contract on the part of employer to first construe the rules unreasonably and put that unreasonable construction in practice.” 

With respect to business interests and secrets, the case of Sinclair –vs- Neighbour (1963)  All ER  is very instructive. In the case, a shop manager who knew his employer was not coming to take money from the tin borrowed $15 without permission leaving a sign IOU and returned the money the following day. The employer dismissed him. The Court upheld the decision and stated that even though the employer was not out of pocket, the employee had demonstrated he was a bad risk because he had violated a basic rule of employment. It was upon him as a manager to keep the till inviolate. 

The employee must look after his employer’s client interests on behalf of his employer. For instance he must not approach his employer’s customers while still in service for the sake of making business with the customers for himself. In Norman –vs- Britton (1972) All ER 280 an employee’s use of confidential information about his employer’s customers in setting up his business was held to entitle his employer to all the profits of that business. 

An employee risks dismissal if he does not pass on to his employer of any knowledge he may have of any substantial dishonesty among other employees especially if he is in a position of responsibility. In Austwick –vs- Midlands Rly A union official wrote to fellow employee demanding that he should apologize for reporting a fellow employee’s theft to his employer. Held: his behaviour was intimidatory and condoned dishonesty hence the dismissal justified. 

Courts have been reluctant to accept that what a man does in his own time is of any employer concern but in certain peculiar circumstances they may be bound to accept employee’s liability. However, some of his activities may be harmful to the employer directly or indirectly. So that violent and dishonest behaviour out of work may be likely to suggest his unfitness for office or to damage employer’s reputation as if it took place at work. The same may be drawn of conduct which is immoral or socially unacceptable. In Clouston –vs- Corry (1906) AC 122 a company Manager was held to be properly dismissed after a conviction of drunk and disorderly in hotel and using obscene language in presence of women. In Orr –vs- University of Tasmania a married professor’s dismissal for seducing a female student was upheld.

Changes in public standards must be taken into account in considering the old cases. In Myers –vs- Mono (1970) 2 All ER 177 dismissal of a manager accused by employer of being a great pitcher of bottoms and breasts was held unjustified when found to have pitched only two women on the bottom in isolated circumstances. 

NB: Conditions of employment are just the rights and duties in employment contract. See s. 26 of the Act which declares the minimum working conditions as those contained in part V and VI of the Act.

4. TERMINATION OF EMPLOYMENT

TERMINATION OF EMPLOYER-EMPLOYEE RELATIONSHIP

A contract of employment can be terminated by any party at any time. This can be done in following ways: 

1. Mutual agreement:

This derives from the doctrine of freedom of contract. There is no issue of redundancy or governmental intervention. The parties to the contract merely agree to end the contract of employment. The agreement must be clear and voluntary. It should not be forced by any party.

2. Lapse of time (Effluxion of time): 

If a contract specifies the duration for which the employer-employee relationship is to subsist, the contract terminates upon the lapse of such time. Where there is no reference to time or the employment is described as permanent & pensionable without age of retirement being specified, the duration of contract of employment is determined through reasonable interpretation of the contract which is dependent on the custom or usage of the job in question e.g. for the civil servant the period is 60 years. 

3. By Notice: 

Contracts of employment have provision for notice period within which either party to the contract may intimate to the other his/her desire to terminate the contract. Upon expiry of such notice period the contract terminates. In lieu of such notice, the party terminating the relationship may pay the other the equivalent of such salary as would be earned over notice period. The idea is that the other party is given time to adjust without interruption. 

Where contract is silent on the question of termination by notice, a term will be implied at common law to make provision for it. The principal function of notice rule is to give both sides an opportunity of leaving employer-employee relationship at no cost. The length of notice may be so set as to grant one or both parties some degree of monetary compensation for the ending of the relationship. The development of notice rule is historically linked to changes in typical duration of the contract of employment. When it became normal for contracts to have indefinite duration as opposed to fixed term contracts it became necessary for parties and for the courts through the technique of implied term to make provision for termination by notice. 

See the provisions of S. 35 of the Employment Act on the periods of notice where a contract of service is one not involving performance of specific work or it is without reference to time.

4. Frustration: 

This arises where there is fundamental change of circumstances. At common law a contract discharged by frustration is terminated automatically regardless of opinion or knowledge of parties concerned. That position was adopted in the case of Hirji Mulji –vs- Cheong Yue SS Co. Ltd (1926) AC.497 .

Supervening events that could frustrate a contract are death of a party, imprisonment, bankruptcy of employer and liquidation. It is an established principle of law that a contract will not be frustrated by supervening events if parties have made provision for that event in the contract.

5. Redundancy: 

This arises due to closure of place of work or enterprise or where excess labour in enterprise is laid off for economic reasons. In such event the employer is liable to make redundancy payment to the employee, which is calculated by reflection to employee’s security, salary level and age.

See the provisions of S. 40 of the Employment Act on the conditions that an employer has to comply with if he has to terminate the employment of an employee on account of redundancy.

6. Dismissal: 

An employer may dismiss an employee for just cause and where that is not so the employer may be liable for damages for unlawful or wrongful dismissal or unfair termination. Is there a difference between “unlawful or wrongful dismissal” and “unfair termination”?

Under S. 44(3) the Employment Act empowers an employer to dismiss an employee summarily when the employee has by his conduct indicated that he has fundamentally breached his obligations arising under the contract of service.

Under S. 44(4) the Employment Act empowers an employer to summarily dismiss his employees for certain reasons. The said reasons are deemed to amount to gross misconduct and are as follows:

1. without leave or other lawful cause, an employee absents himself from the place appointed for the performance of his work;

2. during working hours, by becoming or being intoxicated, an employee renders himself unwilling or incapable to perform his work properly;

3. an employee wilfully neglects to perform any work which it was his duty to perform, or if he carelessly and improperly performs any work which from its nature it was his duty, under his contract, to have performed carefully and properly;

4. an employee uses abusive or insulting language, or behaves in a manner insulting, to his employer or to a person placed in authority over him by his employer;

5. an employee knowingly fails, or refuses, to obey a lawful and proper command which it was within the scope of his duty to obey, issued by his employer or a person placed in authority over him by his employer.

6. in the lawful exercise of any power of arrest given by or under any written law, an employee is arrested for a cognizable offence punishable by imprisonment and is not within fourteen days either released on bail or on bond or otherwise lawfully set at liberty; or

7. an employee commits, or on reasonable and sufficient grounds is suspected of having committed, a criminal offence against or to the substantial detriment of his employer or his employer’s property.

Under S. 41 the employer is required to notify and give a hearing to an employee before terminating his employment on grounds of misconduct.

Under S. 43 in any claim arising out of termination of a contract, the employer shall be required to prove the reason or reasons for the termination, and where the employer fails to do so, the termination shall be deemed to have been unfair within the meaning of section 45.

Under S. 45 the law sets out: 

- the circumstances under which termination will be deemed unfair which include the reason is not valid; reason is not related to employee’s conduct, capacity or operational requirements; procedure is not fair and it is found in the circumstances of the case the employer did not act in accordance with justice and equity in terminating employment.

- period one needs to be in employment being 13 months to able to complain of unfair termination.

- factors to be considered in deciding whether it was just and equitable for the employer to terminate employment which include procedure adopted in reaching decision to dismiss; conduct and capability of employee; compliance with statutes by employer; previous practice of the employer and existence of warning letters to the employee.

Under S. 49 the law sets out: 

- the remedies for wrongful dismissal and unfair termination which include  wages for notice period; general damages not exceeding 12 months and reinstatement.

- factors to be considered in deciding the remedies to recommend which include wishes of the employee; circumstances of termination; practicality of reinstatement; common law principle against specific performance in employment; length of service; reasonable expectation of employee as to length of time they would have worked for the employer; opportunities for the employee to secure comparable employment; value of any severance payable by law; any unpaid wages, expenses or other claims; expenses as a result of termination; conduct of employee which may have contributed to termination; failure of employee to mitigate losses due to unjustified termination and any compensation including ex-gratia  payment made by the employer.

Under S. 50 the law sets out that the employment court should be guided by the principles in s. 49.

REMEDIES OF BREACH OF CONTRACT EMPLOYMENT

1. Repudiation:

If breach of contract of employment is so fundamental as to indicate lack of intention to contract the agreed party can repudiate the contract.

2. Damages – measure of damages:

If breach is by the employer, the employee is entitled to damages in the measure of loss of earnings. However, the employee is under duty to mitigate the loss that arises from such breach. If he does not damages may not be rewarded at all. The English position is that if he does, damages may be punitive or exemplary. That was decided in Parry –vs- Cleaver. See the provisions of S. 49 of the Eployment Act on the measure of damages for wrongful dismissal and unfair termination.

3. Specific Performance:

This is whereby a court orders an employer to reinstate the employee. Specific performance is an equitable and discretionary remedy. It is a rare remedy on the basis of public policy. S. 49(4)(d) reiterates the said position and urges the court to consider the common law principle that there should be no order for specific performance in a contract of service except in very exceptional circumstances.

5.0 FREEDOM OF ASSOCIATION AND THE RIGHT TO ORGANIZE

TRADE UNIONS AND MEMBERSHIP

Trade Unionism:

To understand Trade Unionism one must understand the social basis of associations. Social associations have their origin and basis from the “human need for protection.” Collectively is seen as a basis for defence of one self. 

For a social association to exist there must be a community or commonality of interests. However it must be appreciated that associations are to some extent an expression of differences in interests. This is because whereas there will always be a commonality of interests in the same group, there will also exist intra-associational differences e.g. class differences, age and gender differences.

Where there is community of interests there can be no effective association unless there exists a level of consciousness of common interest and of necessity organizational capability to further the interests. It is therefore imperative that a sound institutional framework for an association be established. Where that is not the case a loose association arises in that it is informal and adhoc and of little effect in furthering its objectives.

It is crucial that an association should have high degree of permanence if it is to usefully pursue its objectives. With respect to employment associations it is worth noting that employees despite being in different ranks have certain common interests e.g. job security, level and kind of wages and working and living conditions. The same can be said of employers e.g. availability of labour, profit generation, investment in living and working conditions of employees etc.

Of interest is the fact that there is at least one common interest that both employers and employees pursue i.e. continuation of employer-employee relationship because it’s a mutual one. The reaction to this reality is that both employers and employees have formed associations to pursue both their distinct interests and the common ones. That way collective bargaining is enhanced e.g. it is easier for employee to approach employer association than individual employer. The difference in workings of employer and employee associations is the level of consciousness, organizational level and institutional framework. Employer associations usually have an upper hand in those issues.

Rationale and role of collective organisation:

In advanced industrial society the employer always has greater economic and social power than any worker. For workers to have any effective power in the employment relationship they must join together to further their demands on a collective basis only then do they have a chance of counterbalancing the power of employer.

Since the 19th Century the British Trade Unions have in general perceived their primary role as being improvement of members’ terms and conditions of employment through the mechanism of collective bargaining. This is not merely functional equivalent of individual bargain on a collective scale, but  a process of joint regulation which prescribes not only terms upon which individual contracts should draw but may extend to broader aspects of job regulation and the working environment e.g. disciplinary procedures and training.

As such it is capable of serving as a conduit for wider demonstration and participation on the part of workers in the operation of the enterprise. A further benefit of effective collective organization is that it may assist workers to enforce their legal rights. Experience has shown that workers join Trade Unions because of the access that membership gives them to legal representation. Representation by an organization which has knowledge to recognize potential test cases is reasonably beneficial in putting pressure on employers to comply on their legal obligations.

On the employers’ side the rationale for collective organization is different from that of workers. Although employers do form associations both at sectoral and multi-industry level, these are not the functional equivalent of trade unions in that individual employer is already a collective power in being the owner of capital.

Origin and growth of trade union movement:

In Europe where trade unionism emerged, employers and government were hostile to trade unions. This attitude was imported into Kenya by colonial authorities. It was not until 1937 that recognition of Trade Unions in Kenya came about. The colonial government encouraged settler investment not only for reason that labour was cheap but also because workers were expected to be docile. That was the reason why growth of trade unions was discouraged.

At that time trade unions were treated with suspicion as being agents of political agitation. Worker organizations were therefore seen as illegal until 1937. In England initially they were regarded as criminal and civil conspiracies against the government. It was only the 19th century in England that Trade Unions were recognized.

In Kenya mass discontent in the labour sector did not become significant until 1940s when workers in town started organizing informally. Earlier on the rural base of labour was difficult to organize workers. There had been pre-emptive measures to block such movement e.g. the Passfield circular of 1930, which suggested limited unionization to control mass discontent among workers. This circular was ignored until 1937 when growth of illegal labour movements outbalanced fear of Trade Unionism. It was against this imbalance of 1937 that Trade Unions Ordinance was enacted.

The theme of ordinance was to empower state control rather than facilitate Trade Unionism. It created the principle of legality of unionism purposely to create responsible unionism. As was stated at the passing of the ordinance its aim was:

“to prevent all irresponsible agitators from causing trouble amongst labour in the country and therefore confine Trade Unionism to strictly non-political purposes”.

This was to be done through a mechanism of regulation so that disliked bodies were denied registration. The only value of ordinance, was that on registration the union would cease to be illegal. Under the ordinance activities by Trade Unions in restraint of trade were illegal.

Definition of restraint of trade was taken verbatim from the 1870 Trade Unions Act (UK). From its terms, members of Trade Unions were liable for tortious actions committed in course of Industrial action. Peaceful picketing (demonstration at work place) was illegal and so was sympathetic action by the non-striking workers.

This was the position despite the fact that picketing and sympathetic action are major tools of Trade Unionism. However labour unrest continued in urban areas so much so that the Trade Unions and Trade disputes ordinance of 1943 was enacted. It was aimed at creating immunities for union members engaged in lawful activities. It declared that tortious action against a union member would not be entertained by the Courts. Such was the burden of the Union itself.

Industrial action was legalized by the ordinance in the sense that no action could be entertained as against an employee on grounds that he had interfered with labour or breached his contract in course of action. Peaceful picketing was allowed but ordinance prescribed what conduct amounted to peaceful picketing. 

Regulation of trade unions:

Under S.2   a trade union is an association of employees whose principal purpose is to regulate relations between employees and employers, including any employers’ organization. A Trade Union must have as its principal object as the furtherance of members’ interests collectively. A trade Union may have other permissible objects which are incidental to the primary object. These must however be set out in the Trade Union’s constitution. 

The constitution of a Trade Union is like a standard form contract so much so that its members are bound by all the rules established thereunder. The framework for regulation of Trade Unions is found in the Labour Relations Act. Part III of the Act establishes the institutional framework for the registration of Trade Unions. It’s from the fact of registration that Trade Unions derive their legal validity. The institutional framework comprises the Registrar of Trade Unions, Deputy Registrar, Assistant Registrars and other officers. These officers are vested with the powers by the Act to reject registration so long as they act within the powers granted by the Act. They are immune from legal action. They must however act in good faith and without negligence in executing their statutory duties.

S. 12-14 prescribes the procedure and the requirements for establishing and registering a Trade Union. S.12 provides that a person shall not recruit members for the purpose of establishing a trade union or employers’ organization unless that person has obtained a certificate from the Registrar issued under this section. The application for the certificate shall be signed by two persons who are promoting the establishment of the trade union or employers’ organization; specify the name of the proposed trade union or employers’ organization and contain any other prescribed information.

The Registrar shall then issue a certificate within thirty days of receiving an application unless

1. the application is defective; or

2. the name of the proposed trade union or employers’ organization is the same as that of an existing trade union or employers’ organization or is sufficiently similar so as to mislead or cause confusion.

The certificate issued shall specify that—

1. the promoters may undertake lawful activities in order to establish a trade union or employers’ organization; and

2. an application for the registration of the trade union or employers’ organization shall be made to the Registrar within six months of the date of issue of the certificate.

The Registrar may withdraw a certificate issued under this section if the Registrar has reason to believe that—

1. the certificate was obtained by fraud, misrepresentation or as a result of a mistake; or

2. any person has undertaken an unlawful activity, whether in contravention of this Act or any other law, on behalf of the proposed trade union or employers’ organization.

S. 13 provides that a trade union or employers’ organization shall apply to the Registrar for registration within six months of receiving a certificate issued as afore mentioned.

S. 14 provides for the requirements for registration of a trade union as follows:-

That a trade union may apply for registration if—

1. the trade union has applied (i.e. prepared an application) for registration in accordance with the Act;

2. the trade union has adopted a constitution that complies with the requirements of this Act, including the requirements set out in the First Schedule;

3. the trade union has an office and postal address within Kenya;

4. no other trade union already registered is—

1. in the case of a trade union of employers or of employees, sufficiently representative of the whole or of a substantial proportion of the interests in respect of which the applicants seek registration; or

2. in the case of an association of trade unions, sufficiently representative of the whole or a substantial proportion of the trade unions eligible for membership thereof:

Provided that the Registrar shall, by notice in the Gazette and in one national daily newspaper with wide circulation, notify any registered trade union, federation of trade unions or employers’ organizations which appear to him to represent the same interest as the applicants of the receipt of such application and shall invite the registered trade union federation of trade unions or employers’ organization concerned to submit in writing, within a period to be specified in the notice, any objections to the registration;

5. only members in a sector specified in the constitution qualify for membership of the trade union;

6. the name of the trade union is not the same as that of an existing trade union, or sufficiently similar so as to mislead or cause confusion;

7. the decision to register the trade union was made at a meeting attended by at least fifty members of the trade union;

8. the trade union is independent from the control, either direct or indirect, of any employer or employers’ organizations; and

9. the trade union’s sole purpose is to pursue the activities of a trade union.

S. 15 prescribes the requirements for registering an employers’ organization, s. 16 prescribes the requirements for registering a federation of trade unions while s. 17 prescribes the requirements for registering a federation of employers. 

S. 18 prescribes the requirements for application for registration of a trade union as follows:- That an application to register a trade union, employers’ organization or federation shall be made to the Registrar in Form A set out in the Second Schedule, accompanied by—

1. the prescribed fee;

2. a certified copy of the constitution of the trade union or employers’ organization; and

3. a certified copy of the attendance register and minutes of the meeting at which the trade union, employers’ organization or federation was established.

The application to register a trade union shall be signed by seven members of the trade union. The Registrar is empowered to call for further information for the purposes of evaluating an application for registration or give an applicant for registration an opportunity to rectify the application within a period specified by the Registrar.

If the proposed name of a trade union, employers’ organization or federation is the same or sufficiently similar to that of an existing organization so as to mislead or cause confusion, the Registrar shall either request the applicant for registration to alter the name of the trade union or employers’ organization or federation; or decline to register the trade union, employers organization or federation until a suitable alteration has been made.

S. 19 provides for the actual registration of a trade union as follows:- That if the Registrar is satisfied, after consulting the Board, that a trade union, employers’ organization or federation that has applied for registration meets the requirements of the Act, the Registrar shall register that trade union, employers’ organization or federation and shall—

1. issue a certificate of registration in Form B set out in the Second Schedule; and

2. enter the name and details of the trade union, employers’ organization or federation in the appropriate register in Form C set out in the Second Schedule.

The certificate of registration issued as above mentioned is conclusive evidence that the trade union, employers’ organization or federation has been duly registered under this Act unless it is proved that the certificate has been withdrawn or cancelled.

S. 20 provides for the refusal of registration of a trade union as follows:- That if the Registrar is not satisfied that a trade union, employers’ organization or federation meets the requirements for registration and refuses the application for registration, the Registrar shall advise the trade union, employers’ organization or federation of the reasons for that refusal in Form D set out in the Second Schedule.

S. 21 provides for the effect of registration of a trade union as follows:- That a trade union, employers’ organization or federation shall be registered as a body corporate—

1. with perpetual succession and a common seal;

2. with the capacity in its own name to—

1. sue and be sued; and

2. enter into contracts; and

3. hold, purchase or otherwise acquire and dispose of movable and immovable property.

See S. 28 on grounds upon which the registrar may cancel or suspend the registration.

Part IV provides for officials and members of trade unions and employers’ organizations. S. 31 - 32 provides for qualifications for membership and office: Any person over apparent age of 16 years can belong to a Trade Union. Any person below that age cannot be an officer or trustee of a Union. For such officer-ship or trusteeship one must be over 21 years. One has to be working in an industry to which the Trade Union relates to qualify for membership. Additionally one has to be employed or resident in Kenya.

Legal personality of trade unions:

This area of law has evolved tremendously and a trade union has legal personality but not like that of companies given that it has slight differences. Trade Unions have no legal personality beyond that conferred by the Labour Relations Act. Salient features of legal personality of a trade union are as follows:- The law gives immunity from civil suits in certain instances in furtherance of a trade dispute. This is because a trade union is formed in furtherance of the interests of its members and thus could involve itself in activities amounting to breach of contract or restraint of trade. See S.22.

The law gives trade unions immunity from tortious liability arising from the conduct of industrial action. Trade unions have the right to sue and be sued in their own names. Trade unions have the power to hold and own property in their own names but such property is vested in the trustees. Conditions attached to holding of property are:

1. Be held and used for benefits of and furtherance of activities of the trade union

2. There must be kept accounts of how the property of the union is used.

3. Annual Returns must be rendered to the registrar including all the trade unions’ financial activities.

Trade unions have direct right of perpetual succession vested in the trustees.

Dissolution of trade unions:

The law assumes that dissolution of a trade union will be done in accordance with the constitution or Rules Book of the trade union. The law requires that once dissolution is effected the registrar must be notified within 14 days by a notice signed by at least 7 members and the secretary general of the union. After such dissolution, it ceases to exist and all activities carried out thereafter other than for purposes of winding up are illegal. See S. 29 of the Labour Relations Act.

COLLECTIVE BARGAINING AND COLLECTIVE AGREEMENTS

Collective bargaining:

Initially, contracts of employment were individual and were presumed to be freely negotiated by parties to such contracts. The trend later moved to contracts drawn by employers so that terms are not negotiated by parties. This is the mode of employment used by most institutional employers today.

When Trade Unions emerged, the concept of collective bargaining arose to ameliorate the weak standing employees had. The result of collective bargaining was Collective Bargaining Agreements (CBAs). The basic inputs of Collective Bargaining are conflicts and disorder because it leads to breach of existing terms which creates a conflict of interests followed by disorder because it involves attempts to secure new interests or rights or to vary existing ones. 

The basic output of collective agreements are that a framework of rules for resolving conflicts is established i.e. norms to be followed in dispute resolution e.g. how redundancy is to be carried out etc. There are various theories as to purpose of collective bargaining which can be summarized as follows:-

1. It fortified workers’ strength in the sense that it’s difficult to negotiate with employer as an individual employee.

2. It introduces democratic participation by workers in the enterprise in the sense that their representatives negotiate with employers on their behalf.

3. It introduces an element of industrial peace especially where there is recognition of Trade Unions.

4. It creates an element of power in industrial relations between labour force and management.

Indeed the Industrial Relations Charter of 1962 was meant to introduce cooperation and consultation on mutual understanding which is necessary for efficiency in production or development of any industrial undertaking.

The Charter sets out responsibilities for management and Trade Unions on which Collective Bargaining would be based. The Charter:

1. Sets out speedy machinery for settlement of disputes between employers and workers.

2. Decided that future industrial disputes were to be settled by negotiation, conciliation or arbitration and as a last resort Industrial Action which had to be preceded by notice.

3. Declared that intimidation and victimisation of worker was unlawful.

4. Directed that management and unions should foster good relations among their representatives.

5. Directed that management and employees be educated on their industrial obligations.

6. Advised that management and employees recognize and respect each other’s freedom.

The Charter sets out specific responsibilities of Management as follows:

1. Recognizing unions as bodies to negotiate with.

2. Granting employees the freedom to join the unions they want.

3. Encourage speedy settlement of disputes and implementing settlements thereof expeditiously.

4. Establishing proper disciplinary procedures and mechanisms.

On the part of Unions the Charter identified the specific responsibilities as being:

1. Discouraging wild cats strikes i.e. strikes that take place without following laid down procedures.

2. Discouraging bad or negligent workmanship and encourage maintenance of essential services. 

3. Setting up a model recognition agreement and joint labour federation.

The structure of Collective Bargaining in Kenya is as follows:-

1. At the outset voluntary recognition, presupposed so that a mechanism for it should be put in place.

2. If that fails resort is had to conciliation and investigation through a conciliatory team setup by the minister under Labour Relations Act (see S. 54) for that purpose.

3. If that fails recourse is had to compulsory arbitration through Employment and Labour Relations Court.

In Kenya Collective Bargaining is not a market place affair but a legislative concern. Labour Relations Act deals with mechanisms for that. It is also a tripartite power relationship between employer and employee through Trade Union, Government and employers and government and employees (i.e. employer, employee and Government).

Collective labour relations mean that the individual workers must sacrifice their individual freedom of contracts to their respective Trade Unions which bargain on their behalf. The co-relative to this is that management is at times compelled to or of its own motion finds it quite appropriate to recognize the relevant Trade Union for purposes of collective bargaining.

The subject matter of Collective Bargaining is two-fold

1. Procedures – which relates to negotiations and recognition of Trade Unions.

2. Substantive – which relates to negotiation on terms of employment e.g. wage level, conditions of work etc.

In terms of the decision in Thomson –v- Dekin (1952) CD 646 at common law there was no duty on an employer to recognize a Trade Union. Similarly, at common law there was no duty to bargain with Trade union as was declared by the court in Stratford & Sons –v- Lindley.

The position in Kenya has been modified by statute. S.54 of the Labour Relations Act deals with recognition of Trade Unions. The Act requires that an employer shall recognise a Trade Union with simple majority of employee members in a certain field where there is no Union claiming to represent them. Where such rivalry exists, the minister is enjoined to sort out such rivalry. The minister’s decision can be challenged in an Employment and Labour Relations Court, which may amend, revoke or approve the minister’s decision (see S. 62).

Legal status of collective bargaining agreements:

Do they have a contractual effect? The legal answer must emanate from the fact whether a Trade Union is a principal or an agent. Can an employee thus sue an employer successfully for breach of terms of a CBA? The answer depends on whether the CBA was intended to be binding. At common law CBAs were not meant to bind the union as a body since it was not a party to the initial contract of employment. The position has been modified by the Labour Relations Act.

This position at common law was taken by the court in the case Ford Motor Company Ltd –vs- Amalgamated Union of Engineering and Foundry Workers (AUEFW) (1969) 2 QB 303 : (This case has been overtaken by the statute). By a 1955 agreement a joint negotiating committee between ford and fifteen Trade Unions was set up. All the parties signed the agreement. In 1967 a similar agreement made provision for new terms and conditions which provided that any variation must be negotiated through a 1955 meeting. In 1969, Ford proposed a variation which was noted upon and acted. But some unions which represented 2/3 of the task force rejected it. Ford announced that new terms had been agreed upon. Some of those terms were violently opposed by a cross section of the dissenting unions and some members undertook wild cat strikes. The AUEFW made the strike official for its members. Ford sued the Union for breach of the 1969 agreement. Lane –J- in dismissing the suit stated: 

“Agreements such as these are composed largely of optimistic aspirations presenting grave practical problem of enforcement and they reached against a background of opinions adverse to enforceability are not contracts in the legal sense and are not enforceable in law. Without clear and express provisions making them amenable to legal process, they remain in realm of undertakings binding in honour.”

Thus at Common Law the position is that a CBA is not contract in the sense that an individual cannot enforce it. A member of Union cannot enforce it against an employer in a court of law. A Trade Union also cannot enforce it against an employee because there is no privity of contract between the employee and the trade union.

The position in England is different by virtue of Trade Unions and Labour Relations (consolidation) Act (1993). In the USA the Taff Hartley Act 1947 introduced a clause to the effect that suits for violations of agreements between employer and a labour organization representing employees in an industry may be brought in any district court having jurisdiction over the Plaintiffs without regard to the amount of money in consideration. Thus the US Law recognizes such agreements as being legally binding.

Under Part VII of the Labour Relations Act s. 60 provides for registration of CBA so as to make it valid as a CBA. S. 59 also provides for the legal status and effect of CBAs. Thus our position is that the fact of registration of a CBA by the Employment and Labour Relations Court makes it legally enforceable against employers and employees but it’s upon the employers to incorporate them into the individual contracts of employment of the unionisable workers.

6.0 LABOUR DISPUTE RESOLUTION and INDUSTRIAL ACTION

INDUSTRIAL RELATIONS

Industrial relations are a dynamic social-economic process. They encompass the whole field of relationships that exist because of necessary collaboration of individuals in the employment process. It is not the course in the effect of social, political and economical forces. The relationship starts with co-operation and soon changes to conflict and thereafter resolution of conflicts which changes the relationship once again to co-operation.

That changing process becomes a continuous feature in the industrial relations system. The relationship between an employer and an employee is based on mutual adjustment of interests and obligations. It depends on economic, social and psychological satisfaction on both sides. The higher the faith on both sides the healthier the relationship

In practice however the interests and objectives of the parties are sharply divided and not easily amenable to reconciliation. This is made worse by fact that financial resources are limited. The legislative task of balancing these conflicting interests proves an extremely difficult exercise in view of the conflict of interests between the parties and need to protect the interests of the public and third parties. The relationship between employers and employees is one in which shared interests is far more significant than the opposing ones. On the one hand employees need to work to earn a living on the other employers need employees to run the enterprise.

Despite that commonality of interests disputes do arise between employers and employees. Most of the legal regimes employers seek to regulate their dealings through the mechanism of state with respect to each other, recognizing the possibility of disagreement and dispute.

The importance of an appropriate system of dispute resolution adapted to the needs of each national labour relation system is widely recognized today. The absence of dispute resolution procedure can result in industrial chaos with adverse effects on the economy.

DISPUTE RESOLUTION

In Kenya the Labour Relations Act no. 14 of 2007 at part VIII lays down framework for trade dispute resolution. S. 2 of the Act defines a Trade Dispute as a dispute or difference, or an apprehended dispute or difference, between employers and employees, between employers and

trade unions, or between an employers’ organisation and employees or trade unions, concerning any employment matter, and includes disputes regarding the dismissal, suspension or redundancy of employees, allocation of work or the recognition of a trade union.

That definition is wide because it was intended by parliament to cover all possible areas of disputes within the labour relation system with a view to subjecting them to the provisions of the Act. 

Essentially there are two kinds of Trade disputes:

1. Rights Disputes

These arise out of a situation in which parties are denied what the law or contract of employment grants them as of right. It arises out of a term.

2. Interests Disputes

Theses arise out of situation in which one party feels that something should be granted or accepted by the other party. The Labour Relations Act provides for conciliation, investigation, the Employment and Labour Relations Court and arbitration as the methods of resolving disputes once they have arisen. The Arbitration Act (No. 4 of 1995) shall not apply to any proceedings before the Employment and Labour Relations Court.

Reporting of trade disputes to the Minister:

Under S. 62 a trade dispute may be reported to the Minister* in the prescribed form and manner by or on behalf of a trade union, employer or employers’ organization that is a party to the dispute and by the authorised representative of an employer, employers’ organisation or trade union on whose behalf the trade dispute is reported.

The person reporting a trade dispute shall serve a copy by hand or registered post on each party to the dispute and any other person having a direct interest in the dispute and satisfy the Minister that a copy has been served on each party to the dispute by hand or by registered post.

A trade dispute concerning the dismissal or termination of an employee shall be reported to the Minister within ninety days of the dismissal or any longer period that the Minister, on good cause, permits. If the issue in dispute concerns the redundancy of one or more employees, a trade union may report a trade dispute to the Minister at any stage after the employer has given notice of its intention to terminate the employment of any employee on grounds of redundancy.

The reporting of a trade dispute by a trade union under subsection does not prevent an employer from declaring employees redundant on the expiry of notice of intention to declare the employees redundant.

Respondent may file replying statement:

Under S. 63 every party to a trade dispute shall file a replying statement in the prescribed form and manner with the Minister within fourteen days of receiving a copy of the report of the dispute. The failure by a party to file a replying statement does not affect the validity of a referral.

Interested party may file statement of interest:

Under S. 64 any party who has an interest in any dispute may file a statement with the Minister within fourteen days of receiving a copy of the referral.

Minister to appoint conciliators:

Under S. 65 within twenty-one days of a trade dispute being reported to the Minister the Minister shall appoint a conciliator to attempt to resolve the trade dispute unless:-

1. the conciliation procedures in an applicable collective agreement binding on the parties to the dispute have not been exhausted; or

2. a law or collective agreement binding upon the parties prohibits negotiation on the issue in dispute.

The Minister may require any party to a trade dispute to supply further information for the purpose of deciding whether to appoint a conciliator. If the Minister refuses to appoint a conciliator as specified in subsection he shall supply the parties to the dispute with written reasons for that decision.

Where a party is aggrieved by the Minister’s decision not to appoint a conciliator, the party may refer the matter to the Employment and Labour Relations Court under a certificate of urgency. The Minister may consult the Board on any trade dispute, which has been reported for conciliation.

Persons appointed to conciliate:

Under S. 66 a person appointed to conciliate a dispute as envisaged hereinabove shall be:-

1. a public officer;

2. any other person drawn from a panel of conciliators appointed by the Minister after consulting the Board or

3. a conciliator from the Conciliation and Mediation Commission.

If the Minister appoints a conciliation committee to conciliate a trade dispute, the Minister shall appoint—

1. a chairperson in accordance with the above mentioned requirements;

2. an even number of persons drawn equally from lists submitted to the Minister by the employer and trade union representatives respectively on the Board; and

3. the secretary of the conciliation committee.

Conciliator’s powers to resolve dispute:

Under S. 67 the conciliator or conciliation committee appointed as above shall attempt to resolve the trade dispute referred to in section 65(1) within:-

1. thirty days of the appointment; or

2. any extended period agreed to by parties to the trade dispute.

For the purposes of resolving any trade dispute, the conciliator or conciliation committee may:-

1. mediate between the parties;

2. conduct a fact-finding exercise; and

3. make recommendations or proposals to the parties for settling the dispute.

For the purposes of resolving any trade dispute, the conciliator or conciliation committee may:-

1. summon any person to attend a conciliation;

2. summon any person who is in possession or control of any information, book, document or object relevant to resolving the trade dispute to appear at the conciliation; or

3. question any person present at a conciliation.

The Minister shall pay the prescribed witness fee to any person who appears before a conciliator or conciliation committee in response to a summons issued as above. No person shall without good cause fail to:-

1. comply with a summons issued 

2. produce any book, document or item specified in a summons issued or

3. answer any relevant question asked by a conciliator or conciliation commission under.

Dispute resolved after conciliation:

Under S. 68 if a trade dispute is settled in conciliation the terms of the agreement shall be:-

1. recorded in writing; and

2. signed by the parties and the conciliator.

A signed copy of the agreement shall be lodged with the Minister as soon as it is practicable.

Dispute unresolved after conciliation:

Under S. 69 a trade dispute is deemed to be unresolved after conciliation if the:-

1. conciliator issues a certificate that the dispute has not been resolved by conciliation; or

2. thirty day period from the appointment of the conciliator, or any longer period agreed to by the parties, expires.

Minister may appoint conciliator in public interest:

Under S. 70 if the Minister is satisfied that it is in the public interest to prevent a dispute from arising or to resolve a dispute, the Minister may appoint a conciliator or conciliation committee to attempt to prevent a dispute or resolve the dispute.

The Minister may appoint a conciliator or conciliation committee in respect of a dispute that has not been referred to conciliation or is unresolved after conciliation, irrespective of whether a trade union is a party to the dispute or not or the dispute is in the public or private sector.

Committee of inquiry:

Under S. 71 the Minister may appoint a committee of inquiry to investigate any trade dispute and report to the Minister.

Exercise of powers of the Minister:

Under S. 72 the Minister may delegate his powers under this Part to the Commissioner for Labour or the Chief Industrial Relations Officer.

Referral of dispute to Employment and Labour Relations Court:

Under S. 73 if a trade dispute is not resolved after conciliation, a party to the dispute may refer it to the Employment and Labour Relations Court in accordance with the rules of the Employment and Labour Relations Court. However if a trade dispute is one in respect of which a party may call a protected strike or lockout, the dispute may only be referred to the Employment and Labour Relations Court by an aggrieved party that has made a demand in respect of an employment matter or the recognition of a trade union which has not been acceded to by the other party to the dispute or is in an essential service, the Minister may, in addition, refer the dispute to the Employment and Labour Relations Court.

A trade dispute may only be referred to the Employment and Labour Relations Court by the authorized representative of an employer, group of employers, employers’ organisation or trade union.

Urgent referrals to Employment and Labour Relations Court:

A trade union may refer a dispute to the Employment and Labour Relations Court as a matter of urgency if the dispute concerns:-

1. the recognition of a trade union in accordance with section 62; or

2. a redundancy where the trade union has already referred the dispute for conciliation under section 62(4) or the employer has retrenched employees without giving notice or

3. employers and employees engaged in an essential service.

Arbitration Act does not to apply:

Under S. 75 the Arbitration Act (No. 4 of 1995) shall not apply to any proceedings before the Employment and Labour Relations Court.

INDUSTRIAL ACTION (STRIKES AND LOCK-OUTS)

Protected strikes and lock-outs:

Under S. 76 a person may participate in a strike or lock-out if:-

1. the trade dispute that forms the subject of the strike or lock-out concerns terms and conditions of employment or the recognition of a trade union;

2. the trade dispute is unresolved after conciliation under the Act or as specified in a registered collective agreement that provides for the private conciliation of disputes; and

3. seven days written notice of the strike or lock-out has been given to the other parties and to the Minister by the authorised representative of the trade union, in the case of a strike; the employer, group of employers of employers’ organisation, in the case of a lock-out.

Powers of Employment and Labour Relations Court:

Under S. 77 a party to a dispute that has received notice of a strike or lock-out may apply to the Employment and Labour Relations Court to prohibit the strike or lock-out as a matter of urgency if:-

1. the strike or lock-out is prohibited under this Part; or

2. the party that issued the notice has failed to participate in conciliation in good faith with a view to resolving the dispute.

A party that failed to attend any conciliation meeting may not seek relief as above mentioned and the Employment and Labour Relations Court may, in granting the said relief direct the parties to engage in further conciliation in good faith with a view to resolving the dispute.

Prohibited strikes or lock-outs:

Under S. 78 no person shall take part in a strike or lock-out or in any conduct in contemplation of a strike or lock-out if:-

1. any law, court award or a collective agreement or recognition agreement binding on that person prohibits a strike or lock-out in respect of the issue in dispute;

2. the subject matter of the strike or lock-out is regulated by a collective agreement or recognition agreement binding on the parties to the dispute;

3. the parties have agreed to refer the trade dispute to the Employment and Labour Relations Court or to arbitration;

4. in the case of a dispute concerning the recognition of a trade union, the trade union has referred the matter to the Employment and Labour Relations Court;

5. the trade dispute was not referred for conciliation in terms of this Act; or a collective agreement providing for conciliation;

6. the employer and employees are engaged in an essential service;

7. the strike or lock-out is not in furtherance of a trade dispute; or

8. the strike or lock-out constitutes a sympathetic strike or lock-out.

For the purposes of this section:-

1. an employee engages in a sympathetic strike if the employee participates in a strike in support of a trade dispute in respect of which the employee’s employer is not a party to the dispute; or is not represented by an employer’s organisation that is a party to that dispute; or

2. an employer engages in a sympathetic lock-out if the employer locksout an employee in support of a trade dispute to which the employer is not a party; or in respect of which the employer is not represented by an employer’s organisation that is a party to dispute.

Strike or lock-out in compliance with this Act:

Under S. 79 a “protected strike” means a strike that complies with the provisions of the Act and “protected lock-out” means a lock-out that complies with the provisions of this Act.

A person does not commit a breach of contract or a tort by taking part in a protected strike or a protected lock-out; or any lawful conduct in contemplation or furtherance of a protected strike or a protected lock-out.

An employer may not dismiss or take disciplinary action against an employee for participating in a protected strike or for any conduct in contemplation or furtherance of a protected strike. Civil proceedings may not be instituted against any person for participating in a protected strike or a protected lock-out; or any conduct in furtherance of a protected strike or protected lock-out. The above provisions do not apply to any action that constitutes an offence. An employer is not obliged to remunerate an employee for services that the employee does not render during a protected strike or lock-out.

Strike or lock-out not in compliance with this Act:

Under S. 80 an employee who takes part in, calls, instigates or incites others to take part in a strike that is not in compliance with this Act is deemed to have breached the employee’s contract and—

1. is liable to disciplinary action; and

2. is not entitled to any payment or any other benefit under the Employment Act during the period the employee participated in the strike.

A person who refuses to take part or to continue to take part in any strike or lock-out that is not in compliance with this Act may not be:-

1. expelled from any trade union, employers organisation or other body or deprived of any right or benefit as a result of that refusal; or

2. placed under any disability or disadvantaged, compared to other members or the trade union, employers’ organisation or other body as a result of that refusal.

Any issue concerning whether any strike or lock-out or threatened strike or lock-out complies with the provisions of this Act may be referred to the Employment and Labour Relations Court.

Essential services:

Under S. 81 “essential services” means a service the interruption of which would probably endanger the life of a person or health of the population or any part of the population.

The Minister, after consultation with the Board shall from time to time, amend the list of essential services contained in the Fourth Schedule and may declare any other service an “essential service” for the purpose of the Act if a strike or lock-out is so prolonged as to endanger the life, person or health of the population or any part of the population.

The essential services include the following:

1. Water Supply Services.

2. Hospital Services.

3. Air Traffic Control Services and Civil Aviation Telecommunications Services.

4. Fire Services of the Government or Public Institutions.

5. Posts Authority and Local Government Authorities.

6. Ferry Services.

There shall be no strike or lock-out in an essential service. Any trade dispute in a service that is listed as or is declared to be an essential service may be adjudicated upon by the Employment and Labour Relations Court. A collective agreement may provide that any service may be deemed to be an essential service.