The Proper Role and Jurisdiction of the Industrial Court
April 22, 2013
MID-YEAR REVIEW AND TRAINING WORKSHOP FOR JUDGES OF THE INDUSTRIAL COURT OF KENYA
JUDICIARY TRAINING INSTITUTE, MUTHAIGA NORTH, NAIROBI
16TH -20TH APRIL 2013
JAMES RIKA, JUDGE OF THE INDUSTRIAL COURT OF KENYA
1. AN INTRODUCTION
2. PROPER JURISDICTION OF THE INDUSTRIAL COURT
3. PROPER ROLE OF THE INDUSTRIAL COURT
4. ILLUSTRATIVE SHARED EXPERIENCES
We had discussed the related subject on ‘the reconstituted Industrial Court of Kenya, and the role of the Social Partners’ at a COTU-K function in Kisumu, on 28th September 2012. Five Judges Mrs. Wasilwa, Mrs. Onyango, Marete, Abuodha and I made some remarks that relate to the role and jurisdiction of the Industrial Court. I understand todays’ subject to entail a review of issues we explored at Kisumu. I will therefore take a short moment and allow Judges to make their comments and discuss. The second reason why I will not be long is because yesterday, most of the speakers touched on the role and jurisdiction of the Court. The Principal Judge Nderi highlighted the role of dispute resolution. Mr. Ombuki described the role of wage adjustment. From Judge Nderi and Mr. Ombuki, the role of the Industrial Court may be summarized as follows: to resolve disputes in a manner that weighs social justice, against the needs of economic growth.
The sticking points in our remarks in Kisumu were these:-
- The role of the Industrial Court is to facilitate social dialogue. Social dialogue includes all types of negotiation, consultation, exchange of information and collective bargaining. The Industrial Court facilitates social dialogue by defining and adjudicating the rights and obligations of the tripartite players- governments, employers and employees;
- Because of the entry of other players who are not traditionally associated with the tripartite in the world of employment and labour such as NGOs, the role of the Industrial Court has expanded to cater for the new players. The practice of labour law is no longer restricted to trade unions and employer groups;
- Due to the changing nature of the labour markets, the role of the Industrial Court has drastically changed from 1964 when it was formally recognized under the Trade Disputes Act Cap 234 the Laws of Kenya, to 2007 when it was made a Superior Court of Record by the Labour Institutions Act Number 12 of 2007, and to 2010 when the Court became a Superior Court of Record under the Constitution of Kenya 2010;
- The traditional role of the Industrial Court as an Institution of Social Justice is to avail quick, uncomplicated and inexpensive justice to workers. The procedures of trade dispute resolution have always been crafted to enable the workers, deemed not to have the same bargaining strength with their employers, access quick, affordable, and effective remedies;
- The shift of the Court into the Judiciary from the Ministry of Labour has resulted in a perception by trade unions that workers will no longer have easy access to industrial justice. This could be a misperception, because the same Constitution has strong provisions empowering workers, and enhancing rather that limiting access to all forms of justice. We should not however disregard the apprehension. The challenge in restructuring the Court is how to accommodate the concerns of the trade unions and employers that we are throwing away the dispute resolution mechanism they created, to suit their unique relations, without adequately consulting them. Those Judges who attended the Kisumu function may have noted the COTU boss Mr. Atwoli and the FKE CEO Mrs. Mugo, were united in the feeling that the Court, appears to be evolving without their adequate consultation. They felt that we are becoming overly legalistic, and not minding the non legal aspects of our form of dispute settlement. We are not considering the essence of Industrial Relations. This was very interesting unanimity of views between the leaders of capital and labour. We need to look at the disputes before us not always as legal disputes, but caution ourselves on the role of the Court as an Institution at the centre of Industrial Relations, a facilitator of social dialogue; and lastly,
- We suggested that the Industrial Court is likely to have a higher number of disputes. Not all these disputes will call for a legal solution. We have a role in sifting out disputes that call for judicial settlement, from those that are suited to ADR. The Industrial Court has been a Labour Institution, standing at the top of well developed voluntary trade dispute settlement mechanisms, developed over the years by the social partners, and well- equipped in this role.
These were some of the issues we had discussed at Kisumu.
2. PROPER JURISDICTION OF THE INDUSTRIAL COURT
Jurisdiction is defined as the practical authority given to a formally constituted legal body, or a political leader, to deal with and make pronouncements on legal matters, and by implication, to administer justice within a defined area of responsibility. Following this definition-[a] The Industrial Court is a formally constituted legal body under the Article 162  of the Constitution of Kenya 2010, which states,
‘’Parliament shall establish courts with the status of the High Court to hear and determine disputes relating to employment and labour relations.’’[b] The Industrial Court Act Number 20 of 2011 was enacted pursuant to Article 162  of the Constitution. It is enacted ‘’to establish the Industrial Court as a Superior Court of Record; to confer jurisdiction on the Court with respect to employment and Labour Relations and for connected purposes.’’ Section 4 states, ‘’In pursuant to Article 162 of the Constitution, there is established the Industrial Court for the purpose of settling employment and industrial relations disputes, and the furtherance, securing and maintenance of good employment and labour relations in Kenya.’’ [c] Section 12 of the Industrial Court Act defines the jurisdiction of the Industrial Court. The Court has ‘’exclusive original and appellate jurisdiction to hear and determine all disputes referred to it in accordance with Article 162 of the Constitution, and the provisions of this Act, or any other written law which extends jurisdiction to the Court relating to employment and labour relations.’’ [d] Among the other principal Acts of Parliament that extend jurisdiction to the Industrial Court are the Employment Act Number 11 of 2007 and the Labour Relations Act Number 14 of 2007. Section 87 of the Employment Act states ‘’Subject to the provisions of this Act, whenever – [a] an employer or employee neglects to fulfill a contract of service; or [b] any question, difference or dispute arises as to the rights or liabilities of either party; or, [c] touching on any misconduct, neglect or ill treatment of either party or any injury to the person or property of either party, under any contract of service, the aggrieved party may complain to the labour officer or lodge a complaint or suit in the Industrial Court.’’ Section 87  states ‘’ No other Court other than the Industrial Court shall determine any complaint or suit referred to in subsection .’’ Section 73 of the Labour Relations Act Number 14 of 2007 extends jurisdiction to the Industrial Court in the following terms- ‘’If a trade dispute is not resolved after conciliation, a party to the dispute may refer it to the Industrial Court in accordance with the Rules of the Industrial Court.’’ Section 74 allows trade unions to refer to the Industrial Court as a matter of urgency, disputes concerning recognition, redundancy, and employees engaged in essential service. The Industrial Court is created and practical Authority given to it, by the Constitution, the Industrial Court Act and other written laws such as the Employment Act and the Labour Relations Act.
A Court’s jurisdiction, as stated in the Supreme Court of Kenya Application No.2 of 2011 involving Samuel Kamau Macharia v. KCB and Others e.KLR, ‘’ ………..flows from either the Constitution or Legislation or both. Thus a Court can only exercise jurisdiction as conferred by the Constitution or other written law. It cannot arrogate to itself jurisdiction exceeding that which is conferred upon it by law………the Court must operate within the constitutional limits. It cannot expand jurisdiction through judicial craft or innovation.’’
The Industrial Court’s proper jurisdiction is as defined in the Constitution and the written laws. We may wish to discuss whether Judges of the Industrial Court have a clear mandate to sit in an Election Court. Where the Chief Justice appoints Justices Nderi, wa Makau from the Industrial Court and HPG Waweru from the High Court to sit on the same bench, we must attempt to understand the nature of the legally constituted body dealing with the subject matter, and what the defined area of responsibility is. If jurisdiction as Judge Abuodha mentioned here yesterday is everything, we must be certain in some of the jurisdictional issues, so that we do not act in vain.
We may also wish to explore other areas of jurisdiction that have kept cropping up, in the course of our daily work. I had a case where for example, an employee was granted a loan by her employer to purchase a house. The employer was the lending bank. The loan was secured through a piece of land owned by the employee. Her contract of employment was terminated and the employer sought to dispose of the security. She has sued the bank for unfair termination. She asks the Industrial Court that the bank be barred from selling her land, pending the resolution of her claim in the Industrial Court, in which she seeks to be reinstated. If she had come to you seeking an injunction restraining her employer from selling her plot, would you disqualify yourself? In some cases, you will even find that the matter has been through the voluntary dispute resolution mechanisms under the Labour Relations Act and all issues including the land, environment, commercial, labour and employment aspects, canvassed. The Respondent feels the dispute should have gone to the Land Court. It may well go before the Commercial Division. You may find recurrent issues of overlapping material jurisdiction. You may also wish to discuss whether in cases of overlapping jurisdiction, you should have truncated proceedings. Should we separate the portions that are fully, labour and employment matters, while taking the parties to the Land and Commercial Courts on the other portions? Judge Abuodha broached the subject of work injury yesterday. The issue of overlapping jurisdiction will keep recurring. You may find a matter of occupational health and safety emerging in the Environment Court. You should have it at the back of the mind that Labour and Employment Relations are forged on the Land. The Economy is interdependent, and the divisions given under Article 162 may not always be mutually exclusive.
The other recurrent subject relates to temporal jurisdiction. You know about section 90 of the Employment Act which states that we do not receive disputes that are older than three years. To what extent can you extend time limits, and what are your views about the common argument that certain rights have accrued, and cannot be defeated by limitation of time? You will also note that Courts are created at a certain point in time, and can only lean backwards to the extent given by a specific law. Temporal jurisdiction may also be reviewed against the provisions of the Labour Relations Act Number 14 of 2007 that give the Minister discretion in extending late reports of termination and dismissal claims. It is possible that one Claimant goes with a very old employment claim to the Minister under the Labour Relations Act, and the Minister exercises his discretion in favour of extending time. Another individual may come directly before you, under the Employment Act, and you find your hand as a Judge is tied by Section 90. The same employment wrong is implicated, but the result may not be the same. This is an issue of temporal jurisdiction that is worth our mid-year review and training.
The issue whether you can entertain disputes in contracts of employment made outside the country, for performance in Kenya and other African countries, will also keep appearing before you. There are employment contracts affecting the economy of more than one country. As you know Kenya is host to many cross-national employers, and we have a sizable number of expatriates. We are a popular destination for international labour. Labour has become highly mobile. Kenyan Companies are extending their businesses across the borders. Some contracts say the applicable law shall be the law of the place where the contracts were made, which may not be Kenya. In labour law, there is the maxim that lex loci laboris, which loosely translated is that the applicable labour law, is the law of the place. Labour law like criminal law is highly territorial. If a dispute involving an International NGO and its employee is brought before you, and you are told the contract of employment says the applicable law is the law of the UK, are you going to disqualify yourself and refer the employee to the UK, even though after termination, she remains resident in Kenya, and the concerned employer has a presence in Kenya? What of the Kenyan employee, contracted by a Kenyan company incorporated in Rwanda, in a contract concluded in Rwanda? Geographical jurisdictional issues may find their way to our Court. We are integrating regionally and globalizing. We may wish to exchange our views on this. We need to ponder over this issue.
3. PROPER ROLE OF THE INDUSTRIAL COURT
The proper role of the Industrial Court as suggested at the discussion paper in Kisumu is the protection and promotion of social dialogue and social justice. Workers are understood to have no equality of bargaining power. Employers are the wielders of capital. They have a head-start, in the authoring of the employment contract. Workers therefore need court protection, which is a function exercised by the Industrial Court. We ought to have it at the back of our minds that Industrial Courts were not designed for the White Collar employees, the Chief Executives and Computer Desk Employees in a company, but for the Blue Collar Employee, who toil in the agricultural plantations and industrial area manufacturing firms. Trade Unions were not given the procedural exceptions in coming to Court to protect White Collar Employees. The flexible industrial justice system exemplified in the Trade Disputes Act was not designed with the White Collar employee in mind. The challenge we face is how, to accommodate the White Collar and the Blue Collar Employees in a Court that traditionally was meant to only accommodate the Blue Collar Employee. It must always be remembered that the Chief Executives of Companies are deemed to have some degree of skills and can negotiate their way, and are not in an inferior bargaining position with any employer, calling for needless court protection. The Industrial Justice System was not conceived with this type of the employee in mind. Company Executives started coming to our Court from 2008 when the new labour laws became operational.
The role of the Industrial Court is to promote industrial harmony, and regulate the relations between employers and their employees; between the trade unions and employer organizations; and resolve disputes arising from these relations. The Court goes about mediating the boundaries of rights and obligations of employers and employees in accordance with equity, good conscience and the substantive merits of the dispute. The primary objective is to attain social justice by upholding fair work practices.
The Labour Relations Act was enacted to among other things, promote sound labour relations through protection and promotion of freedom of association, the encouragement of effective collective bargaining and promotion of orderly and expeditious dispute settlement, conducive to social justice and economic development….’’ Orderly resolution of disputes and encouragement of effective collective bargaining, are fundamental functions of this Court. The Employment Act 2007 was enacted to declare and define the fundamental rights of employees, to provide basic conditions of employment of children and to provide for matters connected with the foregoing. It is through the instrumentality of the Industrial Court that these fundamental rights are actualized.
The Court has recently acquired a very important role. With the promulgation of the Constitution in 2010, the Court has been conferred the jurisdiction to interpret the Constitution, on matters falling within its jurisdiction. Labour Rights, Social and Economic Rights, have been enshrined in the Constitution. We have a role to protect and promote these rights. We have moved away from the era when our role under the legal regime was unclear. We are created by the Constitution, and given an important mandate to protect that Constitution. We no longer suffer a crisis of legitimacy, and we have the stability to develop the law. We have an important role to develop the law.
The Industrial Court, more than any other Court has a role in applying, international law to our domestic labour market. We are the Institution that the International Labour Organization looks up to, to implement the International Labour Standards. The labour law reforms of 2007, which first suggested we could be a Superior Court, were driven by the ILO and the social partners. We have the role to promote and protect international labour standards. It would be in the interest of this Court, that the Judiciary does not lose touch with the ILO otherwise we may find ourselves unable to understand the ILO agenda, and our role in its fulfillment.
4. SOME ILLUSTRATIVE SHARED EXPERIENCES
At Kisumu, I mentioned an Australian Judge called Michael Kirby. He was a Judge of the High Court of Australia. Between 1975 and 1983 he served as the Deputy President of the Australian Conciliation and Arbitration Commission. His speech, Industrial Relations Law-Call off the Funeral captures the essence of Industrial Justice Systems. It helps us capture the role of the Industrial Court. He states,
‘’So disruptive were the strikes of 1890s, that a Commission was established to come up with a solution. Thus was born one of Australia’s great social experiments. The idea found its way into the new federal Constitution. Before very long, it saw the creation of a unique national court, to bring a new province of law and justice to the relations between Australia employers and employees……..
The Arbitration Court established basic wage of seven shillings a day for Australian workers. In 1922 it introduced the automatic costs of living adjustments to protect workers and their families against inflation. Between 1920 and 1930, it introduced the 44 hour week into federal Awards. By 1947 the working week was reduced to 40 hours. In 1965, equal pay was awarded to Aboriginal Stockmen. In 1968, equal pay for women was first awarded federally. In 1979 maternity leave was granted. It is a remarkable social change, brought about through a national judicial institution. The Court Achieved equity, through labour law……….
The big challenge in the future is likely to come from the growing moves to render labour standards throughout the world the subject of international rules, though bodies such as the International Labour Organization. In a sense it is the counterpart and counterbalance to the World Trade Organization. The Industrial Relations Commission is well placed as an instrument that will assist our economy, to translate changing international standards into Australian employment practices. Such standards are an increasing part of the global economy of which ourselves are part.’’
This speech was delivered by the Hon Judge at the launch of Australian Labour Law Association Newsletter on 18th July 2001. A lot has happened to our own labour laws, after 2001 when the Cockar Task Force was set up. It is our role to translate changing international standards into Kenyan employment practices. The role of the Industrial Court as an agent of social change is adequately captured in this speech. Our role as such agents, operating within the context of international labour standards, remains.
The second comparative experience I would wish to mention is that of the Nigerian Industrial Court. The Supreme Court of Nigeria held in the case of the National Union of Electricity Employees and Anor v. Bureau of Public Enterprises [unreported Suit No. SC/62/ 2004] that, ‘’ The National Industrial Court is a Subordinate Court and does not have exclusive jurisdiction in matters assigned to it by statute. Unless the Constitution is amended, it remains a Subordinate Court to the High Court.’’ According to the President of the Nigerian Industrial Court, this decision dealt a heavy blow to the Industrial Court. It confirmed that like our Court before the coming into force of the Constitution, the Nigerian Court could not claim to be a Superior Court of Record, or exercise exclusive jurisdiction in employment and labour disputes. The workers in Nigeria did not therefore have a Court that could render fast, affordable and effective industrial justice. On 4th March 2011, the Nigerians adopted the Constitution [Third Alteration] Amendment Bill, which saw the entrenchment of the National Industrial Court of Nigeria, into the Constitution. We have shared experiences and shared challenges. The role of the Industrial Courts everywhere, as instruments of social change has been recognized. Workers and employers have achieved constitutional inclusion for this Institution that has been at the centre of their relationship for the past century.
Not all Industrial Courts have had a happy ending. Where there is failure in defining the role and jurisdiction, there is not likely to be a happy ending. One of the tragic cases in the history of Industrial Courts is to be found in the Kansas Court of Industrial Relations, in the US. In November 1919 coal miners in Kansas went on strike. It was during a harsh winter. Fuel supplies fell short. To break the strike, the Governor recruited new workers, mostly young university students, paying them half the wages the strikers were receiving. After about one month the strike was settled.
Soon the Governor convened a special session of the Legislature, concerned about the effect a repeat of the coal miners’ strike would have on the economy of Kansas. Most Industrial Courts are created in response to strike actions. The Kansas Legislature established the Kansas Court of Industrial Relations. The Court was actually a three-man board, which would make rules, settle disputes and even take over and run businesses. Collective bargaining was allowed, but strikes prohibited. The US Supreme Court overruled several decisions of this Industrial Court. In 1925, the Kansas Legislature abolished the Court.
This was a Court similar to what I termed in Kisumu as a bastard judiciary badly in need of restraint. It was important that the Industrial Court operates within a clearly defined and legal framework, under the Constitution, where our proper jurisdiction and role are well understood.
The Industrial Court of Kenya faces opportunities as well as challenges under the Constitution. There are global labour standards that we need to maintain. The Judiciary and in particular the Judiciary Training Institute, must keep facilitating the Judges to participate in the programs of the International Labour Organization. The Judges must be facilitated to attend the ILO annual delegates’ conference and ILO Turin Training Institute, for us to keep abreast of the International Labour Standards. In my view we have made tremendous achievements, and reasserted our role, in bringing about social change. Thank you.
1. Re-Constituted Industrial Court of Kenya and Role of the Social Partners- J.Rika Tom Mboya Labour College, Kisumu 28th September 2012.
2. The National Industrial Court of Nigeria: Past, Present and Future, Discussion Paper prepared by Hon. Justice Babatunde Adejumo, President National Industrial Court of Nigeria, on 24th March 2011 at National Judicial Institute Abuja.
3. 1999 Constitution of Nigeria and the Constitution [Third Alteration] Bill 2010.
4. Supreme Court of Nigeria No. 62 of 2004 between National Union of Electricity Employees and Anor v. Bureau of Public Enterprises [ unreported].
5. Industrial Relations Law-Call off the Funeral- Hon. Justice Michael Kirby High Court of Australia, 18th July 2001.
6. The Constitution of Kenya 2010.
7. The Industrial Court of Kenya 2011.
8. The Labour Relations Act 2007.
9. The Employment Act 2007.
10. ‘Social Dialogue in the Process of Structural Adjustment and Private Sector’ – Peter Turn Bull, ILO Series 2005.
11. See Kansapedia, Kansas Historical Society, ‘Court of Industrial Relations’