https://new.kenyalaw.org/akn/ke/judgment/keelrc/2026/1933

REPUBLIC OF KENYA IN THE EMPLOYMENT AND LABOUR RELATIONS COURT AT NAIROBI ELRC CAUSE NO. 942 OF 2017 SIMON NGIGE GICHEHA …………………………………………………..…1ST CLAIMANT JAMES ANYANGA OKOBA……………………………………………..……2ND CLAIMANT GODFREY OMONDI OTIENO…………………………………………...……3RD CLAIMANT CICARY MWANGI KAMAU……………………………………………..……4TH CLAIMANT BENDETTA NDUKU……………………………………………………...……5TH CLAIMANT ABUGA ONYANGI CHARLES……………………………………………...…6TH CLAIMANT DAVID ODHIAMBO ONYANGO……………………………………………...7TH CLAIMANT DANIEL MUTUKU KYANIA…………………………………………………..8TH CLAIMANT COLLINS OCHIENG OMONDI……………………………………………...…9TH CLAIMANT FRED OTIENO OKUTA…………………………………………………….…10TH CLAIMANT SAMWEL OCHIENG………………………………………………………..…11TH CLAIMANT EVANS SITUMA BARASA……...……………………………………………12TH CLAIMANT EVANS CHADAKA SUDI…………………………………………………….13TH CLAIMANT JOHN MOMANYI NYAKOE……………………………………………….…14TH CLAIMANT RONOH KIPKORIR RAYMOND……………………………………………..15TH CLAIMANT GRACE KWAMA……………………………………………………………...16TH CLAIMANT JOB GISEMBA…………………………………………………………………17TH CLAIMANT DAMARIS MWIKALI…………………………………………………………18TH CLAIMANT JOHN KATUKU KISAA……………………………………………………….19TH CLAIMANT SUSAN AWINO ADONGO……………………………………………………20TH CLAIMANT WINFRED NYIVA NDING'O………………………………………………….21ST CLAIMANT JANE KADII…………………………………………………………………...22ND CLAIMANT ANN NDUKU…………………………………………………………………..23RD CLAIMANT JACINTA OKIKI…………………………………………………………….....24TH CLAIMANT JACINTA MUTISYA…………………………………………………………..25TH CLAIMANT CAROLINE NDUKU………………………………………………………..…26TH CLAIMANT REGINA SYOMBUA………………………………………………………..…27TH CLAIMANT ALICE AWINO………………………………………………………………...28TH CLAIMANT GEORGE OWILI…………………………………………………………….…29TH CLAIMANT MAPESA PHANICE………………………………………………………..….30TH CLAIMANT FIDELIS MUTHOKA………………………………………………………..…31ST CLAIMANT WINNIE MUKAI…………………………………………………………....…32ND CLAIMANT FLORENCE NJAMBI………………………………………………………….33RD CLAIMANT MARYLINE JEPTOO………………………………………………………….34TH CLAIMANT PHILIP OCHIENG…………………………………………………………..…35TH CLAIMANT EVELYNE NASAMBU…………………………………………………….….36TH CLAIMANT BILLIAN MUKETI………………………………………………………….…37TH CLAIMANT MARY GATHINJIA……………………………………………………………38TH CLAIMANT KENNETH AKAMBA………………………………………………………....39TH CLAIMANT ERIC OPIYO………………………………………………………………....…40TH CLAIMANT JOSEPH MOSOTI ONYANCHA………………………………………………41ST CLAIMANT ROBAI NANYAM…………………………………………………………..…42ND CLAIMANT DAVID KYENDO…………………………………………………………...…43RD CLAIMANT ROBERT MANDERE………………………………………………………….44TH CLAIMANT JOSEPH KAGUNYI………………………………………………………..…..45TH CLAIMANT HUMPHREY ODWONG………………………………………………………46TH CLAIMANT DORCAS WANJIKU………………………………………………………..…47TH CLAIMANT DANIEL OTIENO…………………………………………………………...…48TH CLAIMANT MAXSOM NGAYO………………………………………………………....…49TH CLAIMANT BENJAMIN ORIKO……………………………………………………………50TH CLAIMANT JUSTUS MOSONGO…………………………………………………………...51ST CLAIMANT TERESA NDUTA……………………………………………………………...52ND CLAIMANT THOMAS KISILU…………………………………………………………...…53RD CLAIMANT MARTIN MUGENDI………………………………………………………..…54TH CLAIMANT ELIJAH OKELO……………………………………………………………..…55TH CLAIMANT ERIC LUGIDIA………………………………………………………………...56TH CLAIMANT AINEA MASINDE…………………………………………………………..…57TH CLAIMANT BENSON ABERE……………………………………………………………...58TH CLAIMANT MARBEL ACHIENG………………………………………………………..…59TH CLAIMANT JULIUS MUTUKU……………………………………………………………..60TH CLAIMANT IRINE AYUMA………………………………………………………………....61ST CLAIMANT JUSTUS KASYOKA…………………………………………………………...62ND CLAIMANT FREDRICK MULI…………………………………………………………...…63RD CLAIMANT PETER SHISAINA…………………………………………………………..…64TH CLAIMANT JOSEPH OMONDI…………………………………………………………..…65TH CLAIMANT DENNIS NZII…………………………………………………………………..66TH CLAIMANT BENARD KIPKOECH MUTAI………………………………………………..67TH CLAIMANT ROBERT WANJALA………………………………………………………..…68TH CLAIMANT PETER ONAMO………………………………………………………………..69TH CLAIMANT JOHN MUSYOKA……………………………………………………………..70TH CLAIMANT STELLA MUTUKU………………………………………………………….....71ST CLAIMANT MOSES MAINGI…………………………………………………….………...72ND CLAIMANT SHADRACH MWENDWA…………………………………………………....73RD CLAIMANT GRACE AMMBASA…………………………………………………………...74TH CLAIMANT ESTHER GICHOVI…………………………………………………………….75TH CLAIMANT BIANGA CHEPTOO…………………………………………………………..76TH CLAIMANT - VS – UNILEVER KENYA LTD…...………………………………………….….1ST RESPONDENT HENRY KIPKEMBOI BITTOK T/A MACHIMCHIM GENERAL SUPPLIES…………………………………….2ND RESPONDENT Coram Before Lady Justice Jemimah Keli C/A Otieno JUDGMENT 1. The claimants were outsourced workers under a contract for services between the respondents for the supply of labour for packing and loading by the 2nd respondent to the 1st Respondent’s business. Upon expiry of the contract for services between the parties, the claimants' services were terminated in a manner they deemed unfair. Through an amended statement of claim dated 28th August 2024, the claimants sued the 2 respondents seeking the following orders- 2. A Declaration that the claimants suffered wrongful/unlawful/unfair/termination as the redundancy was unprocedural. 3. Notice pay amounting to Kshs. 45,812,916/= 4. Twelve (12) months compensation for having suffered unlawful termination amounting to Kshs. 264,817,896/= 5. Severance pay amounting to Kshs. 142,943,546/= 6. Service pay amounting to Kshs. 29,779,906/= 7. Compensation for annual leave days amounting to Kshs. 73,901,813/= 8. Annual leave allowance amounting Kshs. 14,530,154/= 9. Refund of all NHIF deductions not remitted amounting to Kshs. 3,099,7661= 10. Basic salary underpayments to be tabulated 11. House allowances underpayment to be tabulated 12. Interest on all the above 13. Costs of the suit 14. The Claimant’s claim was accompanied by an undated list of witnesses; witness statements of the 1st, 2nd, 4th, 5th, 6th, 7th, 8th, 9th, 10th, 11th, 12th, 13th, 16th, 19th, 21st, 22nd, 23rd, 24th, 25th, 26th, 28th, 29th, 30th, 31st, 32nd, 33rd, 34th, 35th, 36th, 37th, 38th, 39th, 40th, 43rd, 44th, 45th, 46th, 47th, 48th, 50th, 51st, 52nd, 53rd, 54th, 55th, 56th, 57th, 58th, 59th, 60th, 61st, 62nd, 63rd, 64th, 65th, 66th, 67th, 69th, 71st, 72nd, 73rd, 74th, 75th, and 76th Claimants, all dated 28th August 2024; and list of documents dated 5th May 2017 with the bundle of documents attached. The court noted that some witness statements were missing, but the 1st claimant, Simon Ngige Gicheha, testified on behalf of the 76 claimants. 15. In response to the claim, the 1st Respondent appeared through the law firm of Kaplan & Stratton Advocates and filed an amended memorandum of defence dated 6th December 2024. To support their response, the 1st Respondent submitted a witness statement from Anneliese Kinanu dated 4th December 2024, along with a list and bundle of documents dated 23rd January 2025. 16. On their part, the 2nd Respondent appeared through the law firm of Chepkoech & Mengech Partners Advocates and filed an amended reply to the statement of claim dated 13th December 2024. In support of their response, the 2nd Respondent submitted a list of documents dated 27th January 2025; a list of witnesses of the same date; and witness statements of Daniel Kibiwot Bittok dated 27th January 2025, KiBittok Abraham Cheruiyot dated 27th January 2025, Henry Kipkemboi Bittok (undated), and Moses Kipruto Tanui dated 27th January 2025. Hearing and evidence 1. The claimants’ case was heard before me on 13th May 2025, where Simon Ndige Gicheha gave evidence on behalf of the claimants. He adopted the statement dated 20th August 2024 and produced documents listed under 5th May 2017, marked as MMU /1A/18 at pages 1-216 of the claimants’ bundle. He stated that the claimants were initially 295 and are now 76. He had authority to testify on behalf of the other respondents. He was cross-examined by counsel for the 1st Respondent, Ms Opiyo, and for the 2nd respondent, Chepkoech, and re-examined on the same date. 2. The first respondent’s case was heard on the scheduled date, where the witness of fact was Annerlise Kinanu, (RW1)who told the court she was the Human Resources business manager of the first respondent. She adopted her witness statement dated 4th December 2024 as their evidence in chief and produced the documents filed, being the outsourcing contract as first R-exhibit 1. The witness was cross-examined by counsel for the claimant, Ms Kubai, and for the 2nd respondent, Chepkoech. The witness was re-examined. 3. The 2nd respondent's case was heard on 9th October 2025. Henry Bittok, who was sued as the 2nd respondent testified as RW2. He adopted his filed witness statement as his evidence in chief. He was cross-examined by counsel for the claimant, Ms. Kubai, and Ms. Opiyo for the 1st Respondent. Henry called as his witness Daniel Kibiwot Bittok (RW3), who adopted his witness statement dated 27th January 2025. He was cross-examined by counsel for the claimants, Ms. Kubai, and Ms. Opiyo, advocate for the 1st Respondent. The 3rd witness for the 2nd respondent was Moses Kirputo Tanui (RW4), who adopted his witness statement dated 27th January 2025 and testified on 12th February 2026. He was cross-examined by counsel for the claimants, Ms. Kubai, and by counsel for the 1st Respondent, Ms. Opiyo. The Claimant’s case in summary 1. The Claimants’ case was that they were employed by the Respondents, following recruitment by the 2nd Respondent to work at the 1st Respondent’s premises and under the 1st Respondent’s direct supervision, on various dates and in different positions earning various salaries, as detailed below. The Claimants state that they were generally employed as packers, loaders, palletizers, supervisors, storekeepers, laboratory assistants, and processing assistants. The employment details of each Claimant are as follows: 2. 1st CLAIMANT-SIMON NGIGE GICHEHA * 1. Date of employment – 26th March 2010 2. Monthly Salary at the time of redundancy - Kshs. 16,000/- 3. Role – supervisor in the processing, general supplies and NSD departments. 3. 2nd CLAIMANT- JAMES ANYANGA OKOBA * 1. Date of employment – 2008 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – loader. 4. 4th CLAIMANT- CICARY MWANGI KAMAU * 1. Date of employment – 2010 2. Monthly Salary at the time of redundancy - Kshs. 6,321.88 3. Role – palletiser. 5. 5th CLAIMANT – BENDETTA NDUKU * 1. Date of employment – 2013 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – packer. 6. 6th CLAIMANT – ABUGA CHARLES * 1. Date of employment – 2010 2. Monthly Salary at the time of redundancy - Kshs. 8,555.63 3. Role – processing assistant. 7. 7th CLAIMANT- DAVID ONYANGO * 1. Date of employment – 2011 2. Monthly Salary at the time of redundancy - Kshs. 8,500/- 3. Role – palletiser. 8. 8th CLAIMANT – DANIEL KYANIA * 1. Date of employment – 2011 2. Monthly Salary at the time of redundancy - Kshs. 7,431.25 3. Role – palletiser. 9. 9th CLAIMANT – COLLINS OMONDI * 1. Date of employment – 2010 2. Monthly Salary at the time of redundancy - Kshs. 8,473.13/- 3. Role – palletiser. 10. 10th CLAIMANT – FRED OKUTA * 1. Date of employment – 2010 2. Monthly Salary at the time of redundancy - Kshs. 16,000/- 3. Role – supervisor. 11. 11th CLAIMANT – SAMWEL OCHIENG * 1. Date of employment – 2010 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – general worker. 12. 12th CLAIMANT – EVANS BARASA * 1. Date of employment – 2011 2. Monthly Salary at the time of redundancy - Kshs. 5,500/- 3. Role – loader. 13. 13th CLAIMANT- EVANS CHADAKA SUDI * 1. Date of employment – 2011 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – palletiser. 14. 16TH CLAIMANT – GRACE KWAMA * 1. Date of employment – 26th March 2010 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_. 15. 18th CLAIMANT – DAMARIS MWIKALI * 1. Date of employment – 2010 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – packer. 16. 19th CLAIMANT – JOHN KISAA * 1. Date of employment – 2010 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – processing assistant. 17. 21st CLAIMANT -WINFRED NYIVA * 1. Date of employment – 2011 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – packer. 18. 22nd CLAIMANT – JANE KADII * 1. Date of employment – 2012 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – packer. 19. 23rd CLAIMANT – ANN NDUKU * 1. Date of employment – 2004 2. Monthly Salary at the time of redundancy - Kshs. 5,034.79 3. Role – packer. 20. 24th CLAIMANT – JACINTA OKIKI * 1. Date of employment – 2013 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – packer. 21. 25th CLAIMANT- JACINTA MUTISYA * 1. Date of employment – 2010 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – packer. 22. 26th CLAIMANT – CAROLINE NDUKU * 1. Date of employment – 2008 2. Monthly Salary at the time of redundancy - Kshs. \_\_\_\_\_\_\_\_\_\_\_\_ 3. Role – packer. 23. 28th CLAIMANT – ALICE AWINO * 1. Date of employment – 2004 2. Monthly Salary at the time of redundancy - Kshs. 5,300/- 3. Role – packer. 24. 29th CLAIMANT – GEORGE OWILI * 1. Date of employment – 26th March 2010 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – processing assistant. 25. 30th CLAIMANT- MAPESA PHANICE * 1. Date of employment – 2010 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – packer. 26. 31st CLAIAMNT – FIDELIS MUTHOKA * 1. Date of employment – 2014 2. Monthly Salary at the time of redundancy - Kshs. 8,500/- 3. Role – processing assistant. 27. 32nd CLAIMANT – WINNIE MUKAI * 1. Date of employment – 2010 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – packer. 28. 33rd CLAIMANT – FLORENCE NJAMBI * 1. Date of employment – 2009 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – general worker 29. 34th CLAIMANT – MARYLINE JEPTOO * 1. Date of employment – 2015 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – packer. 30. 35th CLAIMANT – PHILIP OCHIENG * 1. Date of employment – 2012 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – processing assistant. 31. 36th CLAIMANT – EVELYNE NASAMBU * 1. Date of employment – 26th March 2010 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – general worker. 32. 37th CLAIMANT – BILLIAN MUKETI * 1. Date of employment – 2012 2. Monthly Salary at the time of redundancy - Kshs. 3,489.73 3. Role – processing assistant. 33. 38th CLAIMANT – MARY GATHINJIA * 1. Date of employment – 2005 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – packer. 34. 39th CLAIMANT – KENNETH AKAMBA * 1. Date of employment – 2008 2. Monthly Salary at the time of redundancy - Kshs. 9,500/- 3. Role – processing assistant. 35. 40th CLAIMANT – ERIC OPIYO * 1. Date of employment – 2011 2. Monthly Salary at the time of redundancy - Kshs. 16,000/- 3. Role – store supervisor. 36. 43rd CLAIMANT – DAVID KYENDO * 1. Date of employment – 2009 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – palletiser. 37. 44th CLAIMANT – ROBERT MANDERE * 1. Date of employment – 2010 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – processing assistant. 38. 45th CLAIMANT – JOSEPH KAGUNYI * 1. Date of employment – 26th March 2010 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – general worker. 39. 46th HUMPHREY ODWONG * 1. Date of employment – 2009 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – processing assistant. 40. 47th CLAIMANT – DORCAS WANJIKU * 1. Date of employment – 26th March 2010 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – packer. 41. 48th CLAIMANT- DANIEL OTIENO * 1. Date of employment – 2012 2. Monthly Salary at the time of redundancy - Kshs. 16,000/- 3. Role – supervisor. 42. 50th CLAIMANT – BENJAMIN ORIKO * 1. Date of employment – 2004 2. Monthly Salary at the time of redundancy - Kshs. 13,400.75 3. Role – supervisor. 43. 51st CLAIMANT – JUSTUS MOSONGO * 1. Date of employment – 2008 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – processing assistant. 44. 52nd CLAIMANT – TERESA NDUTA * 1. Date of employment – 2009 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – packer. 45. 53rd CLAIMANT- THOMAS KISILU * 1. Date of employment – 2005 2. Monthly Salary at the time of redundancy - Kshs. 8,500/- 3. Role – processing assistant. 46. 54th CLAIMANT – MARTIN MUGENDI * 1. Date of employment – 2008 2. Monthly Salary at the time of redundancy - Kshs. 9,500/- 3. Role – processing assistant. 47. 55th CLAIMANT – ELIJAH OKELO * 1. Date of employment – 2010 2. Monthly Salary at the time of redundancy - Kshs. 16,000/- 3. Role – supervisor. 48. 56th CLAIMANT – ERIC LUGIDIA * 1. Date of employment – 2009 2. Monthly Salary at the time of redundancy - Kshs. 17,000/- 3. Role – palletiser. 49. 57th CLAIMANT – AINEA MASINDE * 1. Date of employment – 2014 2. Monthly Salary at the time of redundancy - Kshs. 10,037.56 3. Role – processing assistant. 50. 58th CLAIMANT- BENSON ABERE * 1. Date of employment – 2012 2. Monthly Salary at the time of redundancy - Kshs. 9,049.20 3. Role – processing assistant. 51. 59th CLAIMANT – MARBEL ACHIENG * 1. Date of employment – 2010 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – packer. 52. 60th CLAIMANT – JULIUS MUTUKU * 1. Date of employment – 2005 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – processing assistant. 53. 61st CLAIMANT – IRINE AYUMA * 1. Date of employment – 2016 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – packer. 54. 62nd CLAIMANT – JUSTUS KASYOKA * 1. Date of employment – 2010 2. Monthly Salary at the time of redundancy - Kshs. 8,500/- 3. Role – processing assistant. 55. 63rd CLAIMANT – FREDRICK MULI * 1. Date of employment – 2010 2. Monthly Salary at the time of redundancy - Kshs. 16,000/- 3. Role – general worker. 56. 64th CLAIMANT – PETER SHISAINA * 1. Date of employment – 2010 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – general worker. 57. 65th CLAIMANT – JOSEPH OMONDI * 1. Date of employment – 2010 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – general worker. 58. 66th CLAIMANT – DENNIS NZII * 1. Date of employment – 2010 2. Monthly Salary at the time of redundancy - Kshs. 7,500/- 3. Role – general worker. 59. 67th CLAIMANT – BERNARD MUTAI * 1. Date of employment – 2013 2. Monthly Salary at the time of redundancy - Kshs. 6,732/- 3. Role – palletiser. 60. 69th CLAIMANT * 1. Date of employment – 2009 2. Monthly Salary at the time of redundancy - Kshs. 8,500/- 3. Role – loader. 61. 71st CLAIMANT – STELLA MUTUKU * 1. Date of employment – 2010 2. Monthly Salary at the time of redundancy - Kshs. \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ 3. Role – packer. 62. 72nd CLAIMANT – MOSES MAINGI * 1. Date of employment – 2009 2. Monthly Salary at the time of redundancy - Kshs. \_\_\_\_\_\_\_\_\_\_\_/- 3. Role – palletiser. 63. 73rd CLAIMANT – SHADRACH MWENDWA * 1. Date of employment – 2009 2. Monthly Salary at the time of redundancy - Kshs. \_\_\_\_\_\_\_\_\_\_\_\_ 3. Role – processing assistant. 64. 74th CLAIMANT – GRACE AMBASA * 1. Date of employment – 2006 2. Monthly Salary at the time of redundancy - Kshs. \_\_\_\_\_\_\_\_\_\_\_\_\_ 3. Role – packer. 65. 75th CLAIMANT – ESTHER GICHOVI * 1. Date of employment – 2009 2. Monthly Salary at the time of redundancy - Kshs. \_\_\_\_\_\_\_\_\_\_\_\_\_\_ 3. Role – packer. 66. 76th CLAIAMNT – BIANGA CHEPTOO * 1. Date of employment – 2009 2. Monthly Salary at the time of redundancy - Kshs. \_\_\_\_\_\_\_\_ 3. Role – packer. 67. The Claimants allege the outsourcing was meant to circumvent the benefits secured for the 1st Respondent’s employees under the Collective Bargaining Agreement between it and the Kenya Chemical & Allied Workers' Union. The Claimants argue that they were carrying out the core functions of the 1st Respondent, and there was no fundamental difference between the duties they performed and those of permanent employees of the 1st Respondent. It is the Claimant’s case that the Respondents violated the Constitution, the Labour Institutions Act, and other employment laws, ILO Convention 100 on fair remuneration, ILO Convention 111 (employment and occupation), the ILO Philadelphia Declaration 1944, the 2006 ILO Recommendations on the Employment Relationship, the law on labour outsourcing, and customs and practice on international labour. 68. The Claimants also state that throughout their employment with the Respondents, they were obliged to work on Sundays and public holidays but were never compensated with overtime pay or pay for their unused leave. They also did not receive any medical or leave allowances, and their statutory deductions, particularly NHIF and NSSF, were never remitted to the appropriate institutions. Additionally, they were not paid a housing allowance, contrary to the Collective Bargaining Agreement (CBA) in force between the 1st Respondent and the Kenya Chemical & Allied Workers' Union. 69. The Claimants challenge the purported outsourcing arrangement between the 1st and 2nd Respondents on the grounds that the 2nd Respondent is not a registered employment agency authorised to operate as such by the Ministry of Labour and Social Services under Section 55 of the Labour Institutions Act; the triangular employment relationship created by the 1st and 2nd Respondents was a deliberate effort to undermine the Claimants’ right to fair labour practices, particularly collective bargaining and fair remuneration, in an attempt to secure cheap labour for certain categories of employees instead of directly employing them. This, according to the Claimants, was intended to bypass the benefits secured for the 1st Respondent’s employees under the Collective Bargaining Agreement between it and the Kenya Chemical & Allied Workers' Union. The Claimants argue that they were carrying out the core functions of the 1st Respondent, and there was no significant difference between the duties they performed and those of permanent employees of the 1st Respondent. It is the Claimants’ case that the Respondents violated the Constitution, the Labour Institutions Act, and other employment laws, ILO Convention 100 on fair remuneration, ILO Convention 111 (employment and occupation), the ILO Philadelphia Declaration 1944, the 2006 ILO Recommendations on the Employment Relationship, the law on labour outsourcing, and customs and practice concerning international labour. 70. The Claimants seek the following terminal dues and compensations:- 71. Notice pay (3 months wages in lieu of notice for employees who have worked for more than 6 years, per Clause 24 (f) (i) as read together with Clause 21 (b) of the CBA); 72. Severance pay (72 days for every year worked, per Clause 24 (f) (iv) of the CBA); 73. Service pay (15 days for every year worked, per Section 35 fo the Employment Act) as their NSSF deductions were never remitted; 74. Annual leave pay (26 working days for employees who have worked for less than 15 years, and 30 days for employees who have worked for more than 15 years, per Clause 9 of the CBA); 75. Annual leave allowance at Kshs. 18,000/-, per Clause 10 of the CBA; 76. Interest on terminal dues. 1st Respondents’ case in brief 1. The 1st Respondent’s argument is that there was no privity of contract between the 1st Respondent and the Claimants. They deny the existence of an employer-employee relationship between them and the Claimants. 2. The 1st Respondent explains that they placed advertisements in the print media on several occasions inviting Expressions of Interest for the provision of Contract Labour Services. They sought human resource outsourcing firms from which the 1st Respondent would outsource labour services. Following the advertisements, various firms, including the 2nd Respondent, submitted their expressions of interest, and after evaluation, the 2nd Respondent was awarded the contract as the successful bidder. Subsequently, the 1st Respondent, on 18th November 2013, entered into a Contract for the provision of Labour Services with the 2nd Respondent, effective from 1st May 2013. The contract expiry date was 31st March 2014, or upon completion of the tasks outlined in the Contract, whichever was earlier. Under the contract, the 2nd Respondent's obligations included recruiting qualified personnel to perform the required services, ensuring that the personnel were trained, carrying out background checks, procuring insurance in accordance with the Work Injury Benefits Act, and providing work attire and personal protective equipment. 3. The 1st Respondent further affirms that the parties expressly agreed that the 2nd Respondent was an independent contractor, not an employee and/or agent of the 1st Respondent. This was explicitly stipulated in the contract between the parties. The 2nd Respondent, therefore, had sole discretion over recruiting and terminating the Claimants’ employment. The 1st Respondent emphasizes that they were not involved in the recruitment or interview process and did not possess the authority or power to terminate their employment. 4. It is stated that after the recruitment of the Claimants, they remained under the management and control of the 2nd Respondent. Their contracts of employment were with the 2nd Respondent, and they were paid by the 2nd Respondent following the submission of invoices to the 1st Respondent by the 2nd Respondent and the subsequent payment. The 2nd Respondent also had the duty to deduct and remit the Claimants’ statutory deductions to the relevant authorities. Since the 1st Respondent was not privy to the Claimants’ employment terms with the 2nd Respondent, it denies having a responsibility to ensure that these terms comply with the Collective Bargaining Agreement between it and the Union. 5. The 1st Respondent admits that upon expiry of the contract between it and the 2nd Respondent on 31st March 2014, it did not renew it, thereby ending the relationship between the two parties. Around 4th March 2014, approximately a month before the contract expired, the 1st Respondent published advertisements inviting the public to submit Expressions of Interest for the provision of Contract Labour Services. The 1st Respondent denies engaging in agency employment or a triangular employment relationship. It maintains that it entered into a valid contract with the 2nd Respondent, a legal entity capable of contracting. As an independent legal entity, the 2nd Respondent was solely responsible for obtaining the relevant business permits and/or licences required for the proper execution of the Contract. 2nd Respondents’ case in brief 1. The 2nd Respondent denies that it was masquerading as a labour agency and that it was involved in a triangular employment relationship, although it admits that it entered into a valid contract for provision of labour services with the 1st Respondent. It is emphatic that it met its obligations under the contract with the 1st Respondent. and avers that there was no employer-employee relationship between the 1Respondent and the Claimants. 2. The 2nd Respondent’s position is that the Claimants were casual labourers engaged for a fixed period of time who were paid periodically. According to the 2nd Respondent, there was no employer-employee relationship between it and the Claimants, as there was no valid contract between them on the date of the purported redundancy in May 2014. The 2nd Respondent challenges the Claimant’s claims for unpaid benefits, salaries/wages, and housing allowance due to a lack of evidence. It emphasises that it settled all the Claimants’ dues. 3. Furthermore, the 2nd Respondent asserts that the Claimants have not clearly stated who declared them redundant. It also states that its contract with the 1st Respondent ended on 31st March 2014. Therefore, at the time of the alleged redundancy in May 2014, there were no binding contractual obligations between the 2nd Respondent and the Claimants. 4. Regarding the alleged breach of the employment terms under the Collective Bargaining Agreement, the 2nd Respondent denies being aware of this agreement. The 2nd Respondent points out to the court that some employees listed as Claimants in the case are still employed with the 1st Respondent and are not even aware of the current suit. DETERMINATION 1. The parties filed written submissions as directed. Issues for determination 1. The claimants identified the following as the issues for determination in the suit- 2. Whether the claimants were irregularly or improperly outsourced to the 1st Respondent 3. Who between the 1st Respondent and the 2nd respondent is the legitimate recognized employer of the outsourced claimants 4. Whether the claimants were casual employees 5. Whether the claimants were wrongfully and unfairly terminated from employment 6. Whether the claimants were wrongfully and unfairly terminated from employment on account of redundancy 7. Whether the Claimants were prevented from benefiting from the Collective Bargaining Agreements in force between the 1st Respondent (Unilever Kenya Limited) and Kenya Chemical & Allied workers Union. 8. Whether the claimants are entitled to the reliefs sought 9. The 1st respondent identified the following issues for determination in the suit- 10. Whether the Outsourcing Agreement between 1st Respondent and the 2nd Respondent is valid in law? 11. Whether Section 55 of the Labour Institutions Act, 2007 is applicable to the Outsourcing Contract? 12. Whether an employer-employee relationship existed between the Claimants and 1st Respondent? 13. Whether the 1st Respondent declared the Claimants redundant. 14. Whether the Claimants are entitled to the reliefs sought. 15. The 2nd respondent identified the following issues for determination in the suit- * 1. Whether an employer–employee relationship existed between the Claimants and the 2nd Respondent; Whether the 2nd Respondent can be held liable after 31st March 2014; 2. Whether the Claimants have proved unfair termination; 3. Whether the Claimants have proved entitlement to the benefits and CBA claims sought; 4. Whether the claim is competent in light of evidence of fraud and lack of authority 16. The court discerned that the parties placed the following issues before the court for determination in the suit - * + 1. Whether the Outsourcing Agreement between 1st Respondent and the 2nd Respondent was valid in law? 2. Who was the employer of the claimants ? 3. Whether the claimants ought to have benefited from the Collective Bargaining Agreements in force between the 1st Respondent (Unilever Kenya Limited) and Kenya Chemical & Allied workers Union? 4. Whether the employment of the claimants was unfairly terminated? 5. Whether the claimants are entitled to relief sought? Whether the Outsourcing Agreement between 1st Respondent and the 2nd Respondent was valid in law? 1. It was undisputed that there was an outsourcing contract between the respondents. The said contract was produced by the 1st Respondent as their exhibit 1. The agreement was dated 18th November 2013 and was between the 1st Respondent and Henry Bittok, the 2nd respondent. The agreement was for labour services, specifically packing and loading of the 1st Respondent's products on its premises, and included a service level agreement. The contract commenced on 1st May 2013 and was set to expire on 31st March 2014. During the hearing, the 2nd respondent, Henry Bittok, admitted to the contract. The claimants argued that three issues will establish that the claimants were irregularly and improperly outsourced to the 1st Respondent by the 2nd respondent. Firstly, the engagement between the respondents was flawed. That it is the right of every worker to belong to a trade union, and in this case, the claimants were denied this right when the 1st Respondent engaged in an outsourcing arrangement to deprive them of it. They contended that prior to the outsourcing agreement entered into between the 1st and 2nd respondents, the claimants had been engaged by both parties. The 1st Respondent had engaged the 2nd respondent to procure labour services without a formal agreement, and it was only in November 2013 that an outsourcing agreement was entered into. That the 1st Respondent's defence at paragraph 3 states that they did not seek an agent to outsource labour but sought a human resource outsourcing firm; however, the advertised Expression of Interest (EOI) attached to the claimants' documents (see annexure marked MMU-2 in the claimants' bundle) shows that the 1st Respondent was seeking agents, not a human resource outsourcing firm as alleged by the 1st Respondent in its pleadings. No evidence was presented to demonstrate that the 1st Respondent had sought the 2nd respondent specifically as a human resource outsourcing firm. At the time of engagement, the 2nd respondent was not registered as an employment agency under Section 55 of the Labour Institutions Act. The 2nd respondent operates as a sole proprietorship, not as an employment agency sanctioned by the Ministry of Labour, Social Security and Services. The 1st Respondent was thus engaging with an unscrupulous individual or entity to undermine the principles of Article 41 of the Constitution on collective bargaining and fair labour practices. The second issue concerns whether there was a valid and voluntary transfer of the claimants' services from the 1st to the 2nd respondent. The outsourcing agreement was signed on 18th November 2013, but it was to commence on 1st May 2013. That the claimants had already been irregularly recruited by both respondents prior to the signing of the outsourcing agreement. At that time, the claimants were working at the 1st Respondent's premises, procured by the 2nd respondent without a formal contract. When the agreement was signed, the claimants were unaware of its terms. Had they known, they would have negotiated and willingly transferred to the new employer. In the case of Elizabeth Washeke and 62 Others -Versus- Airtel Networks (K) Ltd ELRC 1972 of 2012, the court held that “...For outsourcing or transfer to take effect as held above, the same must involve one employer to another and the affected employees in any outsourcing agreement or transfer must give their individual consent or, where unionised, be represented by the Union. This is unless the entire or any part of a business is being transferred as a going concern where the employees' employment continues uninterrupted, with the employer changing but not the terms and conditions of service. These remain unchanged in such a scenario of outsourcing or transfer...” We submit that the claimants' consent was necessary for them to work freely under the outsourcing arrangement. The third issue relates to whether the 1st Respondent transferred its core business to the 2nd respondent, which then outsourced employees back to the 1st Respondent. Referring again to the case of Elizabeth Washeke, the court examined what constitutes outsourcing: "...What therefore is outsourcing? As indicated in the submissions of the 2nd respondent ... is a tool that, from an employer's perspective, is used to reduce costs by transferring portions of work to outside suppliers who have expertise in specific areas, rather than undertaking the entire task internally. It is an effective cost-saving strategy when properly used, allowing the employer to focus on core business functions. Outsourcing can, but does not have to, involve the transfer of employees from one firm to another...” In the case of The Wrigley Company (East Africa) Limited-Vs The Honourable Attorney General and 3 others, the court set out the parameters of a valid outsourcing agreement in paragraph 39: “...Before signing off this judgment, we find it necessary to set the parameters for a credible outsourcing program as follows, inter alia: a) Employers are not expected to outsource their core functions; b) Outsourcing should not be used as a means to escape contractual obligations to employees; c) Employees affected by outsourcing must give their express consent, and all outstanding obligations must be settled before outsourcing commences; d) Outsourcing is unlawful if it introduces discrimination between employees doing equal work in the same enterprise...” The outsourcing agreement between the respondents is therefore unlawful and contrary to standard practice, as the 1st Respondent outsourced its core functions to the 2nd respondent. Cross-examining the Human Resource Manager for the 1st Respondent revealed that the claimants were engaged in performing the core business of the 1st Respondent, among other duties. 2. Conversely, the 1st Respondent submitted as follows- the Outsourcing Agreement for the provision of labour services between it and the 2nd respondent, dated 18th November 2013, commenced on 1st May 2013 and was in effect up to 31st March 2014 (hereinafter the "Outsourcing Contract") is proper and valid in law. (See pages 1-12 of the 1st Respondent's List and Bundle of Documents dated 24th November 2021). That pursuant to the Outsourcing Contract, the 2nd Respondent agreed to provide services of packing and loading of 1st Respondent's finished products. As the Outsourcing Contract, under paragraph A, 1st Respondent's main and core business was the manufacturing and distribution of various foods, soaps, detergents and personal care products. Manani, J in Kenya Shipping, Clearing, Freight Logistics and Warehouse Workers Union v Volt Management Services Limited & another (Cause E921 of 2023) [2024] KEELRC 13258 (KLR) (28 November 2024) (Ruling) stated as follows: " Therefore, outsourcing of labour arises when two entities enter into an arrangement through which one supplies the other with human capital for purposes of provision of labour. Under this arrangement, the entity which stands in the position of the employer of the outsourced labour force is the one which supplies the labour force and not the one which utilizes the labour... Quite clearly, the Grievants were employees of the 1sl Respondent in the period immediately preceding their separation with this Respondent. They were not employees of the 2ndd Respondent. As such, the Claimant's action against the 2hd Respondent is misplaced." The concept of outsourcing was dealt in the Court of Appeal case of Abyssinia Iron & Steel Limited v Kenya Engineering Workers Union [2016] eKLR where the Court cited with approval the case of Kenya Airways Limited vs Aviation & Allied Workers Union Kenya & 3 Others [2014] eKLR which stated as follows: "This Court was satisfied that outsources services was an accepted business strategy. In the same case, Murgor, JA. observed that; "Outsourced services is one such widely accepted business concept, which enables a company to focus on core business, reduce overheads, increase cost and efficiency savings, and manage cyclical resources principle therefore, outsourcing of employees is not illegal or untoward, provided it is carried out in accordance with fair labour practices, and the process adopted is not aimed at rendering an employee redundant. The Employment Court has also upheld an employer's right to outsource as part of its managerial prerogative. This right was upheld by the Court in Kenya Ferry Services Ltd v Dock Workers Union [2015] eKLR where the Honourable Justice Rika stated: "Outsourcing as submitted by the Claimant is a management prerogative. It would be wrong for the Court to place a blanket caveat on the Claimant's right to outsource." From the foregoing authorities, it is evident that outsourcing is a lawful and accepted business practice. The Claimants in their submissions have relied on the case of Wrigley Company (East Africa) Limited v Attorney General & 2 others & another [2013] eKLR, to establish parameters for outsourcing. However, such parameters were qualified by the Court of Appeal in Abyssinia Iron & Steel Limited v Kenya Engineering Workers Union (supra) wherein the Court stated that outsourcing is not illegal and should be carried out in accordance with fair labour practices. Without prejudice to the foregoing, 1st Respondent avers that it has complied with the parameters in Wrigley Company (East Africa) Limited v Attorney General & 2 others (supra), in that it did not outsource the core functions of its business but rather auxiliary functions to the 2nd Respondent. The Claimants' first witness (CW1) admitted during the hearing both in his examination in chief and cross-examination that the Claimants were engaged in packing and loading of products. 1st Respondent's Witness (RW1), the HR Business Partner (Supply Chain - East Africa) in her witness statement dated 4th December 2024 and in her testimony during examination in chief and cross-examination, confirmed that the Claimants did not perform any core functions of 1st Respondent. The allegation in the submissions that RW1 admitted that the Claimants were carrying out core functions is completely false as there was no such testimony by RW1. In any event, it is incumbent upon the Claimants to prove that 1st Respondent is not a manufacturing entity but rather a loading and packing company. In doing so, the Claimants bear the burden of proof pursuant to Section 107 of the Evidence Act, which provides that whoever desires a court to give judgment as to any legal right or liability dependent on the existence of certain facts must prove that those facts exist. This position was affirmed by the Court in Evans Nyakwana v Cleophas Bwana Ongaro [2015] eKLR, wherein it was held that: As a general proposition the legal burden of proof lies upon the party who invokes the aid of the law and substantially asserts the affirmative of the issue. That is the purport of Section 107 (i) of the Evidence Act, Chapter 80 Laws of Kenya. Furthermore, the evidential burden...is cast upon any party, the burden of proving any particular fact which he desires the court to believe in its existence. That is captured in Sections 109 and 112 of the Evidence Act, that proof of that fact shall lie on any particular person...The appellant did not discharge that burden and as Section 108 of the Evidence Act provides the burden lies in that person who would fail if no evidence at all were given as either side." The following additional parameters were also set out in re Wrigley Company (East Africa) Limited v Attorney General & 2 others(supra) and they include: "b) An employer will not be permitted to use outsourcing as a means to escape from meeting accrued contractual obligations to its employees; c) An employer will not be permitted to transfer the services of its employees to an outsourcing agency without the express acceptance of each affected employee and in all such cases, the employer must settle all outstanding obligations to its employees before any outsourcing arrangement takes effect; and d) Outsourcing is unlawful if its effect is to introduce discrimination between employees doing equal work in an enterprise." Parameters (b) to (d) as set out above are inapplicable in the present case since none of the Claimants had been transferred from 1st Respondent to the 2nd Respondent. In this regard, since the Claimants had never been employed by 1st Respondent, the question of transfer of the employees to the 2nd Respondent does not arise. The Claimants have not in their pleadings and witness statements indicated that they were transferred from 1st Respondent to the 2nd Respondent. CW1 and 2nd Respondent's first witness (2RW1) on cross examination admitted that the Claimants were employed by the 2nd Respondent. In this regard, their testimony was as follows: Claimants first witness (Simon Ngige) on cross-examination by 1st Respondent's lawyer: "Question- Did you have any Contract of employment with the I Respondent? CW1-No. Question- Were you employed by the 2nd Respondent? CW1- Yes Question- You were outsourced to work for the 1st Respondent? CW1-Corrected Respondent's first witness (2RW1- Henry Bittok- the proprietor of the outsourcing company) on cross-examination by 1st Respondent's Lawyer: "Question- How long was the contract between you and the 1st Respondent? 2RW1- 1 year, I January 2013 to 31st March 2014. Question- What was the agreement with Is Respondent? 2RWI- To provide labour for work as required on need basis. Question- The Claimants were employed by who? 2RW1- Myself. Question- When the contract ended what did you do with the Claimants? 2RW1- I paid last payment. I also left." The 2nd Respondents second and third witnesses Daniel Bittok and Abraham Cheruiyot also admitted on cross-examination that the Claimants were employed by the 2nd Respondent. Additionally, the Claimants in their submissions have admitted as follows "We submit the 2nd Respondent is also shown to have deducted NSSF and NHIF from the salaries of the Claimants...the 2nd Respondent's regular deduction of statutory deductions denoted continuous employment". The court should take into account the above admissions to make a finding that the Claimants were employed by the 2nd Respondent. The Court of Appeal in Barclays Bank Of Kenya Limited v Evans Ondusa Onzere [2015] KECA 173 (KLR) stated as follows: "The cross-examination evidence reveals a clear admission by the respondent of receipt of Kshs.2,808,999/15 which was credited into his account; there is admission of set off of all the outstanding loans due from the respondent to the appellant. In our view, the dicta in Mwangi -v- Wambugu (1984) KLR 453 is applicable. The trial court by ignoring the cross-examination evidence misapprehended the evidence on record and demonstrably arrived at a wrong conclusion of fact. A relevant dictum is the case of Choitram -v- Nazari, (1984) KLR 327, where it was stated that admissions need not be in the pleadings; that admissions may be in correspondence or documents which are admitted or they may even be oral. In the instant case, the trial court erred in failing to take into account the admissions by the respondent elicited during cross-examination. Had the trial court taken into consideration the evidence disclosed in cross-examination, we have no doubt that the court would have dismissed the respondent's claim also Unilever Tea Kenya Ltd vs KPAWU CA E015 of 2020, where the Court of Appeal set aside the lower's court's finding as the court had disregarded the employee's admission of wrongdoing. Whether there was transfer of employment from 1st Respondent to the 2nd Respondent? The Claimants in their submissions have introduced a new factual issue and indicated that the Claimants had previously been employed by 1st Respondent before the execution of the Outstanding Contract and were later transferred to the 2nd Respondent. This is a new allegation that was not pleaded in the Claimants' Amended Statement of Claim dated 28th August 2024. It is an established doctrine that submissions are not avenues to adduce new and fresh evidence/facts before this Honourable court. The Claimants ought to have amended their Statement of Claim and filed any additional evidence in accordance with the rules of the Court. The court has no jurisdiction to deal with issues which are not pleaded. The Court of Appeal in David Sironga Ole Tukai vs Francis Arap Muge and 2 others [2014] eklr held that it is well established that the court will not determine issues which the parties have not pleaded. In any event, and without prejudice to the foregoing, no documentary evidence of the transfer of employees from 1st Respondent to the 2nd Respondent was placed before the court. Neither has any documentary evidence been produced by the Claimants to illustrate that the Claimants were employed by 1st Respondent between the years 2004 and 2013. It is instructive that the Claimants in their submissions have admitted that the 2nd Respondent was the Claimants' employer. The Court of Appeal in Independent Electoral and Boundaries Commission & Anor. vs. Stephen Mutinda Mule & 3 others (2014) eKLR, affirmed the settled principle that parties are strictly bound by their pleadings. The Court further held that any evidence which is inconsistent with or departs from the pleadings goes to no issue and must be disregarded. Similarly in Kimani & 3 others v Wangora (Environment and Land Appeal E041 of 2024) [2025] KEELC 8202 (KLR) (27 November 2025) (Judgment) the court held that submissions are not pleadings and cannot be used to introduce new facts or evidence, and they merely interpret and "market” the case already pleaded. Whether Section 55 of the Labour Institutions Act, 2007 is applicable to Outsourcing Labour agreement. The Claimants have submitted that 2nd the Outsourcing Contract between 1st Respondent and the Respondent is not proper since the 2nd Respondent as an employment agency was not properly registered under section 55 of the Labour Institutions Act, 2007. This is factually incorrect since the 2nd Respondent is not an employment agency as per the definition provided under section 2 of the Labour institutions Act, which defines an employment agency as: a. any person, company, institution, agency or other organisation which acts as an intermediary for the purpose of procuring employment for a worker, but does not include newspapers or other publications unless they are published wholly or mainly for the b. purpose of acting as intermediaries between the employer and the worker; or Employment agencies not conducted with a view to profit, that is to say, the placing of services of any company, institution, agency or other organisation which, though not conducted with a view to deriving any pecuniary or other material advantage, levies from either employer or worker for the above services an entrance fee, a periodical contribution or any other charge; The Outsourcing Contract does not fall within this definition since the 2nd Respondent was not acting as an intermediary for the purpose of procuring employment for workers as it was the employer on record for the Claimants. The 2nd Respondent employed the Claimants directly and paid their wages. This was admitted by the 2RW1- Henry Bittok the owner of the outsourcing business during cross-examination. As a result, the requirement under section 55 of the Labour Institutions Act, 2007, which applies to employment agencies is inapplicable to the Outsourcing Contract. In light of the foregoing, we urge the Honourable Court to hold that the Outsourcing Contract between 1st Respondent and the 2nd Respondent is proper and valid in law. 3. The 2nd respondent did not submit on this issue. Decision on issue 1. 1. It is not disputed that outsourcing labour is a legitimate and legal business strategy, as held in the Court of Appeal case of Abyssinia Iron & Steel Limited v Kenya Engineering Workers Union [2016] eKLR, where the Court cited with approval the case of Kenya Airways Limited vs Aviation & Allied Workers Union Kenya & 3 Others [2014] eKLR where it was stated: "This Court was satisfied that outsourced services was an accepted business strategy.’’ In the same case, Murgor, JA, observed that; "Outsourced services is one such widely accepted business concept, which enables a company to focus on core business, reduce overheads, increase cost and efficiency savings, and manage cyclical resources. Therefore, outsourcing of employees is not illegal or untoward, provided it is carried out in accordance with fair labour practices, and the process adopted is not aimed at rendering an employee redundant.” 2. A contract for services between the respondents was produced by the 1st Respondent as its exhibit 1. The 2nd respondent admitted to having been a party to the contract. The claimants in the amended claim stated that the 1st respondent had placed advertisement for expression of interest for the provision of contract labour services. In paragraph 10 of the claim, the claimants stated that they were recruited by the 2nd respondent to work at the 1st respondent’s premises on diverse dates. The claimants raised in written submissions the issue of having been engaged before the contract, and that there was an issue of transfer of service. This was a new issue not in the pleadings nor was it raised at the hearing. It is well established principle that parties are bound by their pleadings. The Court of Appeal in Independent Electoral and Boundaries Commission & Others vs. Stephen Mutinda Mule & 3 Others (2014) eKLR, affirmed the settled principle that parties are strictly bound by their pleadings. The Court of Appeal further held that any evidence which is inconsistent with or departs from the pleadings goes to no issue and must be disregarded. Similarly, in Kimani & 3 Others v Wangora (Environment and Land Appeal E041 of 2024) [2025] KEELC 8202 (KLR) (27 November 2025) (Judgment), the court held that submissions are not pleadings and cannot be used to introduce new facts or evidence; they merely interpret and "market” the case already pleaded. Similarly, I hold the submissions by the claimants on alleged transfer of service from 1st respondent to the 2nd respondent to be of no issue and are hereby disregarded. 3. The other issue raised by the claimants to impugn the contract of service was that the 2nd respondent had not been registered as an employment agency. The term employment agency is defined under the Labour Institutions Act, section 2 as follows – ‘"employment agency" means—(a)any person, company, institution, agency or other organisation which acts as an intermediary for the purpose of procuring employment for a worker, but does not include newspapers or other publications unless they are published wholly or mainly for the purpose of acting as intermediaries between the employer and the worker; or(b)employment agencies not conducted with a view to profit, that is to say, the placing of services of any company, institution, agency or other organisation which, though not conducted with a view to deriving any pecuniary or other material advantage, levies from either employer or worker for the above services an entrance fee, a periodical contribution or any other charge;’’ (emphasis given)The 2nd respondent supplied the 1st respondent with labour services for a fee. Under the contract for services, he was responsible for recruiting employees and remunerating them. The witness for the claimants confirmed this. I find the contract was valid because it was clearly a contract for services, the service level agreement detailed the labour required and costs, the terms of the tripartite relationship (between the respondents and the employees ) were stated, and it was a term of the contract that the labour was sourced and paid by the 2nd respondent. The court holds the contract for services was legal. The court returns that the Outsourcing Agreement between 1st Respondent and the 2nd Respondent was valid in law. Who was the employer of the claimants 1. At face value, having held the contract for outsourcing was valid. The prima facie position is that the 2nd respondent was the employer. However, the claimants submitted that they were providing core services to the 1st Respondent. That can be a game-changer In the case , if true. Outsourcing, as an business strategy model, consists of a relationship between three categories of persons - an outsourced worker, an outsourcing company and a client enterprise(the user of the labour) which creates a triangular/tripartite employment relationship . The court in determination of who is the employer is guided by ILO Employment Relationship Recommendation, 2006 (No. 198). (hereinafter referred to as C198) paragraph 4, which states as follows- ‘. National policy should at least include measures to: (a) provide guidance for the parties concerned, in particular employers and workers, on effectively establishing the existence of an employment relationship and on the distinction between employed and self-employed workers; (b) combat disguised employment relationships in the context of, for example, other relationships that may include the use of other forms of contractual arrangements that hide the true legal status, noting that a disguised employment relationship occurs when the employer treats an individual as other than an employee in a manner that hides his or her true legal status as an employee, and that situations can arise where contractual arrangements have the effect of depriving workers of the protection they are due;’’Paragraph 9 of C198 further states- ‘9. For the purposes of the national policy of protection for workers in an employment relationship, the determination of the existence of such a relationship should be guided primarily by the facts relating to the performance of work and the remuneration of the worker, notwithstanding how the relationship is characterized in any contrary arrangement, contractual or otherwise, that may have been agreed between the parties.’ specifically the recommendation in paragraph 13 provides the indicators the court is to focus on in determining the employer- ‘13. Members should consider the possibility of defining in their laws and regulations, or by other means, specific indicators of the existence of an employment relationship. Those indicators might include: (a) the fact that the work: is carried out according to the instructions and under the control of another party; involves the integration of the worker in the organization of the enterprise; is performed solely or mainly for the benefit of another person; must be carried out personally by the worker; is carried out within specific working hours or at a workplace specified or agreed by the party requesting the work; is of a particular duration and has a certain continuity; requires the worker's availability; or involves the provision of tools, materials and machinery by the party requesting the work; (b) periodic payment of remuneration to the worker; the fact that such remuneration constitutes the worker's sole or principal source of income; provision of payment in kind, such as food, lodging or transport; recognition of entitlements such as weekly rest and annual holidays; payment by the party requesting the work for travel undertaken by the worker in order to carry out the work; or absence of financial risk for the worker.’’ 1. In the instant case, the evidence was to effect that the contract for services was for packing and loading. It was an uncontroverted position that the 1st respondent was a manufacturer and outsourced business of packaging and loading. The Claimants in their submissions have relied on the case of Wrigley Company (East Africa) Limited v Attorney General & 2 others & another [2013] eKLR, to establish parameters for outsourcing. Conversely, the 1st respondent submitted that such parameters in the Wrigley case were qualified by the Court of Appeal in Abyssinia Iron & Steel Limited v Kenya Engineering Workers Union. The Court stated that outsourcing is not illegal and should be carried out in accordance with fair labour practices(See Kenya Airways case,supra). The 1st respondent submitted that it complied with the parameters in Wrigley Company (East Africa) Limited v Attorney General & 2 others (supra), in that it did not outsource the core functions of its business but rather auxiliary functions of packaging and loading to the 2nd Respondent. The Claimants' first witness (CW1) admitted during the hearing both in his examination in chief and cross-examination that the Claimants were engaged in packing and loading of products. The 1st Respondent's Witness (RW1), the HR Business Partner (Supply Chain - East Africa) in her witness statement dated 4th December 2024 and in her testimony during examination in chief and cross-examination, confirmed that the Claimants did not perform any core functions of 1st Respondent. The claimants’ witness told the court they were engaged in packing and loading. 2. The claimants’ witness told the court that under paragraph 3 of the outsourcing contract, they were under direct supervision of the 1st respondent. On perusal of the contract I established that was not true. The contract stated that the contractor was to report to a 1st Respondent officer on tasks. The contractor is the 2nd respondent and not the workers. The claimant’s witness also told the court that the 2nd respondent had its supervisor at the 1st Respondent's premises. In any event, it was incumbent upon the Claimants to prove that 1st Respondent is not a manufacturing entity but rather a loading and packing company only. In doing so, the Claimants bear the burden of proof pursuant to Section 107 of the Evidence Act, which provides that whoever desires a court to give judgment as to any legal right or liability dependent on the existence of certain facts must prove that those facts exist. The 1st Respondent relied on the decision in Kenya Shipping, Clearing, Freight Logistics and Warehouse Workers Union v Volt Management Services Limited & another (Cause E921 of 2023) [2024] KEELRC 13258 (KLR) (28 November 2024) (Ruling) stated as follows: "Therefore, outsourcing of labour arises when two entities enter into an arrangement through which one supplies the other with human capital for purposes of provision of labour. Under this arrangement, the entity which stands in the position of the employer of the outsourced labour force is the one which supplies the labour force and not the one which utilizes the labour. This position was confirmed by the Court of Appeal in the case of Abyssinia Iron & Steel Limited v Kenya Engineering Workers Union [2016] eKLR. ’’The claimants were recruited and employed by the 2nd respondent; they were paid wages by the 2nd respondent; they did not lead evidence of having been allocated any role to effect of integration as workers of the 1st Respondent; they did not place before the court any disciplinary role by the 1st Respondent. They had supervisors from the 2nd respondent. Their leave and off days were not determined by the 1st Respondent. I find no integration of the claimants into the core business of the 1st Respondent. From the foregoing ILO recommendations,C198, case law and evidence I hold , on balance of probabilities that the 2nd respondent was the employer of the claimants. Whether the claimants ought to have benefitted from the Collective Bargaining Agreements in force between the 1st Respondent (Unilever Kenya Limited) and Kenya Chemical & Allied workers Union. 1. The claimants submitted that they were employed in different years and worked in the various departments of the 1st Respondent The claimants were employed between the years 2004 to 2013 (see witness statements attached and letters of recommendation from the 2nd respondent on pages 120 and 121 of the claimants bundle of documents). That as at the time of their employment and before the outsourcing agreement between the 1st and 2nd respondents on 18th November 2013, the 1st Respondent had entered into several collective bargaining agreements, the relevant CBAs which have a three years period, the most relevant CBA attached to the claimants case being the ones for the years 1/7/2003 to 30/6/2006 and the last one dated 1/7/2012 to 30/6/2015,all the years the claimants were in employment (see documents marked MMU-1A to MMU -1E,attached in the claimants list of documents dated 5th May 2017) That the Claimants have demonstrated going by their job profiles and duties that they were unionisable employees, since their job profiles or duties were covered under the existing CBAS We submit therefore that the claimants should have been paid as per the CBAS attached taking into account that they were all terminated from employment in 2014 when this CBA for the period 1/7/2012 to 30/6/15 was still in force. That from the evidence of the 1st claimant whose roles entailed store keeping, packer and process operator and written statements of the other claimants attached to this case, all of them were unionisable, since they were machine operators, palletisers, processing assistants, loaders, lab assistant, operators, technical machine operators, store assistants, supervisors and packers roles provided in the CBA as unionisable roles (Refer to appendix A of the CBAs titled grading structures(9 Grades( That the Claimants' salaries should primarily have been governed by the existing CBAs and they were therefore entitled to have the terms of the CBAs incorporated in their letters of appointment which the respondents did not issue We submit that the respondent did not incorporate the terms of the registered CBAS into the employment terms of the of the Claimants We submit that failure to incorporate the terms of a CBA which sets outs the terms and conditions of service for unionisable staff went contrary to Section 59(3) of the LRA which provides that..."the terms of the CBA shall be incorporated into the contract of employment of every employee covered by the Collective Agreement We submit that the legal obligation to draw letters of appointment is vested in the employer. The respondent was obliged as the drawer of the Claimants' letters of appointment to include all the CBA terms and conditions in their letters of appointment We submit that the respondent did not incorporate into the claimants' appointments, the terms of the CBA which provided for the favourable salaries and terms and condition on leave pay, annual leave allowance which was contrary to Section 59(3) Labour Relations Act It is our submission that by failing to incorporate the CBA terms and conditions of service into the letters of appointment for the Claimants, also denied them an opportunity of knowing the existence of the CBAS We submit that the 1st and 2nd respondents' failure to disclose to the claimants the CBAs in existence governing the claimants' terms and conditions of employment, the respondents can be stated to have obtained the consent of the claimants fraudulently when they agreed to work for them, in the case of Omondi Justus Ranganga & 28 Others-Vs- Kenya Commercial Bank and Banking Insurance And Finance Union the court stated at paragraph 68 on pg. 17 of the judgement that". 2. The 2nd respondent submitted on the issue of whether the Claimants were unionisable and whether they are entitled to payment under the CBA. The 1st Respondent submitted that such a claim does not arise since the Claimants were not employed by 1st Respondent and were not unionisable employees under the Kenya Chemical and Allied Workers Union ["the Union"] working for 1st Respondent. It should be noted that the Claimants have not produced any evidence to show alleged membership with the Union. The Court in Rang'ang'a v KCB Bank (K) Limited; Banking, Insurance and Finance Union (Interested Party) (Constitutional Petition E100 of 2024) [2025] KEELRC 709 (KLR) (7 March 2025) (Judgment) held that failure to adduce evidence of union membership is fatal. Further any claims premised on the CBA with the Union at the material time has no legal basis whatsoever and offends the doctrine of privity of contract since the Claimants were not parties to the CBA. There is no privity of contract between 1st Respondent, the Union and the Claimants. The Court of Appeal in Savings & Loan (K) Limited v Kanyenje Karangaita Gakombe & another [2015] eKLR rendered itself that: "In its classical rendering, the doctrine of privity of contract postulates that a contract cannot confer rights or impose obligations on any person other than the parties to the contract. Accordingly, a contract cannot be enforced either by or against a third party." The 2nd respondent stated he was not privy to the CBA. 3. The court holds that a Collective Bargaining Agreement (CBA) is a contract between the employer and the employee union. The claimants s were not employees of the 1st Respondent, thus could not have benefits from the CBA between the 1st Respondent and the union. They were not employees of the 1st Respondent, thus the authority in Mondi Justus Ranganga & 28 Others(Supra) at paragraph 68 was not applicable where on page 17 of the judgement where Hon Mbaru held "...Where the employer then proceeds to issue a fixed term contract and blind sides the employee on the terms and conditions negotiated under a CBA for the cadre of employees despite any consent given by the employee placed under such circumstances, such is direct fraud, it is misrepresentation of facts of the existence of the CBA regulating employment and this being contrary to the law regulating basic terms and conditions of employment is illegal. Such invalidates the term contracts issued by the respondent to the claimants. The lack of knowledge of the existing CBA negates the consent given at the point of signing each contract and the respondent with knowledge failed to disclose favorable terms and conditions of employment resulting in engaging in unfair labour practices outlawed under the Bill of Rights for being unconstitutional pursuant to Article 41 of the constitution’ (Emphasis Added) The 2nd respondent, the employer denied knowledge of the CBA. Whether the employment of the claimants was unfairly terminated 1. The claimants submitted that on 31st May 2014, upon reporting to work, they were verbally informed by the 1st and 2nd respondents that they should stop coming to work because the 1st Respondent was in the process of procuring another contractor to supply labour services. The respondents did not provide the claimants with reasons for contemplating the termination of their employment. Instead, the claimants were simply asked by the respondents not to report to work again, which demonstrated a lack of fairness. In Kenafric Industries Limited V. John Gitonga Njeru (2016) eKLR, the Court of Appeal addressed issue of whether the termination was unfair, it held: "...Three things must therefore be satisfied; there must be reason(s) given for the termination, the reason(s) must be fair, and the procedure followed too must be fair. These three conditions are designed to cater for all cases in which an employer instigates the termination of employment." The claimants urged their termination was redundancy. That after the claimants were informed not to come to work anymore, the positions the claimants were engaging in were never done away with and continued to exist, as the 1st Respondent advertised for a contractor to procure the same services the claimants had been undertaking. The claimants relied on the decision in Chapman vs Goonvean & Rostowrack China Clay Ltd (1973) 2 ALLER 1973, where Lord Denning MR held that, it was not a genuine redundancy where the requirements of the business for the affected employees continues just the same as before. The conditions precedent set out under Section 40 of the Employment Act on termination on account of redundancy, were never complied with by the respondents as they sought to do away with the claimants on the basis that their services were no longer required, which information was communicated verbally. 2. Conversely, the 1st respondent submitted that it did not render any of the Claimants redundant for the simple reason that the Claimants were not its employees. The question of whether the Claimants were validly terminated should solely be directed to the 2nd Respondent. In fact, during cross-examination, CW1 admitted that the 1st Respondent had no power or authority to terminate the Claimants' contracts. He confirmed that the letter dated 2nd June 2015 marked as “MMU-7A" at pages 127-128 of Claimants' List of Documents, titled “Trade Dispute- Unprocedural Redundancy of Benjamin Oriko Oboke and 250 others" was framed as a complaint solely against the 2nd Respondent for declaring the Claimants redundant. If 1st Respondent had rendered the Claimants' redundant, they would have included 1st Respondent in the complaint. This documentary evidence supports 1st Respondent's position that it did not participate in the redundancy and that the 2nd Respondent was the Claimant's employer. Further, 1st Respondent could not have terminated or declared redundancies under the Outsourcing Contract since there was no employment relationship between the Claimants and 1st Respondent. Therefore, the Claim against 1st Respondent is misplaced and an abuse of the Court process. Without prejudice to the foregoing, on the issue of the alleged redundancy, the Claimants allege that both the 1st Respondent and the 2nd Respondents verbally instructed them to stop working due to the procurement of a new contractor. However, this assertion is factually incorrect, as CW1 admitted during cross-examination that the Claimants were informed by the 2nd Respondent that their work had come to an end following the expiry of the Outsourcing Contract. Accordingly, the Claimants evidence in this regard is inconsistent. The Claimants have failed to discharge their burden of proof under Sections 107 and 108 of the Evidence Act on the circumstances in respect of the allegation that they were verbally declared redundant by 1st Respondent. Indeed, there is no documentary evidence to support their allegation that 1st Respondent declared the Claimants redundant. Moreover, CW1 stated that his last salary was paid by 2nd Respondent in May 2014 and confirmed that there was no evidence before the court to prove that the last salary payment was in May 2014. Critically, the Outsourcing Contract had lapsed in March 2014 and Claimant's evidence in this regard is not true and is factually impossible as the Outsourcing Contract had already expired. The Claimants did not produce any evidence proving that the Outsourcing Contract had been extended up to May 2014. 3. The 2nd respondent submitted that -Section 45 of the Employment Act presupposes the existence of employment and termination. The Claimants have proved neither. There is no evidence that the Claimants were employees of the 2nd Respondent, nor that the 2nd Respondent terminated their services. In Kenya Ports Authority v Festus Kipkorir Kiprotich [2014] eKLR, the Court held that termination must be proved and cannot be presumed. In the present case, there is not even a prima facie demonstration of termination. Any alleged engagement, if at all, was casual, task-based, and time-bound, and does not meet the threshold for conversion under Section 37 of the Employment Act, as emphasized in Nzioka v Smart Coatings Limited [2017] eKLR. The claim for unfair termination is therefore wholly misconceived and devoid of legal basis. Decision on issue 3 1. It is already established by the court that the 2nd representative was the employer of the claimant. The submissions by the 2nd respondent are contrary to the evidence of the 2nd respondent at trial. At the trial, Bittok, the 2nd respondent, told the court that he took the claimants to the gate daily and paid wages according to days worked and work given, whether day or night. Bittok told the court that the claimants were casual labourers. He denied issuing the payslips produced by the claimants. He denied having terminated the services of the claimants. He also denied declaring any worker redundant. He told the court that he engaged the claimants as per the outsourcing contract, for a maximum of one year. He agreed that some of the claimants had worked for him for 6 years. He relied on the outsourcing contract to show that it expired on 31st March 2014. He said the workers worked in 8-hour shifts. He noted that there was a notice by 1st respondent indicating that work was ending on 31st March 2014. The notice was not presented in court. He added that when the outsourcing contract ended, he paid the workers and also left. 2. The claimants claim redundancy took place on 31st May 2014. The claimant’s witness had no evidence of having been paid a salary in May 2014. The 2nd respondent said by that time he had ended relations with the 1st respondent, the contract for services having expired on 31st March 2014. The question is who declared the claim redundant in May 2014. Where were the claimants working between 1st April 2014 and May 2014 and who was the employer? There was no evidence of the claimants having worked at the 1st Respondent’s premises post March 2014. They were employees of the 2nd respondent and thus the assertion of redundancy in May 2014 was not proved. The alleged pay slips were denied by the employer who stated they were casuals. 3. How did the employment of the claimants by the 2nd respondent end? The 2nd respondent told the court that he paid salary until end March 2014, as per the outsourcing contract end date, and he also closed the shop. I had no doubt he was telling the truth, as the claimants had no evidence of the alleged salary paid in May when the redundancy is alleged. The Employment Act does not envisage that an employer will simply pay salary and close the shop. The employer must prove termination of employment by providing notice or a termination letter. The exception would be where the contract ends by effluxion of time. Section 35 of the Employment Act states—‘A contract of service not being a contract to perform specific work, without reference to time or to undertake a journey, shall, if made to be performed in Kenya, be deemed to be—(a) where the contract is to pay wages daily, a contract terminable by either party at the close of any day without notice; (b) where the contract is to pay wages periodically at intervals of less than one month, a contract terminable by either party at the end of the period next following the giving of notice in writing; or (c) where the contract is to pay wages or salary periodically at intervals of or exceeding one month, a contract terminable by either party at the end of the period of twenty-eight days next following the giving of notice in writing.’ There was no notice of termination by the 2nd respondent to the claimants thus, unfair termination occurred. 4. The 2nd respondent asserted that the claimants were casuals. In his own evidence, he told the court they were engaged for the duration of the outsourcing contract, for one year, and admitted that some of the claimants had been casual for 6 years. A casual worker is defined under the Employment Act as—‘casual employee’ means a person the terms of whose engagement provide for his payment at the end of each day and who is not engaged for a longer period than twenty-four hours at a time.’ The claimants worked for more than one month continuously, thus, the terms of work converted to a contractual arrangement under section 37 of the Employment Act to wit—‘7. Conversion of casual employment to term contract’ (1)Notwithstanding any provisions of this Act, where a casual employee—(a)works for a period or a number of continuous working days which amount in the aggregate to the equivalent of not less than one month; or(b)performs work which cannot reasonably be expected to be completed within a period, or a number of working days amounting in the aggregate to the equivalent of three months or more,the contract of service of the casual employee shall be deemed to be one where wages are paid monthly and section [35(1)(c)](https://new.kenyalaw.org/akn/ke/act/2007/11/eng%402024-04-26%22%20%5Cl%20%22part_VI__sec_35__subsec_1__para_c) shall apply to that contract of service.(2)In calculating wages and the continuous working days under subsection [(1)](https://new.kenyalaw.org/akn/ke/act/2007/11/eng%402024-04-26%22%20%5Cl%20%22part_VI__sec_37__subsec_1), a casual employee shall be deemed to be entitled to one paid rest day after a continuous six days working period and such rest day or any public holiday which falls during the period under consideration shall be counted as part of continuous working days.(3)An employee whose contract of service has been converted in accordance with subsection [(1)](https://new.kenyalaw.org/akn/ke/act/2007/11/eng%402024-04-26%22%20%5Cl%20%22part_VI__sec_37__subsec_1), and who works continuously for two months or more from the date of employment as a casual employee shall be entitled to such terms and conditions of service as he would have been entitled to under this Act had he not initially been employed as a casual employee.’’The court finds that the claimants’ employment for lack of notice was unfair. The court considered that this being outsourced employment, the same was pegged on the said contract, and all that was required for the 2nd respondent was to pay the notice under section 35 of the Employment Act. Redundancy cannot apply as the employment was pegged on the outsourcing contract which expired. Whether the claimants are entitled to relief sought 1. The court found unfair termination due to lack of notice under section 35 of the Employment Act. Notice pay is granted as equivalent to one month's salary. The court upheld the salary paid, as the underpayments were based on the CBA, which the court found was not applicable. Having considered the employment, the court further finds that the claimants are entitled to statutory rights, including service pay of 15 days for each year worked (section 35), 21 days of annual leave (section 28), and housing (section 31) at a rate of 15% of wages paid. The payslips were not proved to be true on a balance of probabilities. The employees had no contract, thus it is unlikely they possessed payslips. Conclusion 1. The court found partial merit in the claim enters judgment for the claimants against the 2nd respondent as follows- 1. The 2nd respondent is held as the employer of the claimants. The 1st respondent is discharged from the suit. No order as to costs. 2. The termination of the employment without notice is held as unfair but justified on account of the expiry of the outsourcing contract. Each of the claimants is to be paid 1 month's salary in lieu of notice. 3. Each claimant to be paid in lieu of leave awarded for 21 days per annum of period of service. 4. Each claimant to be paid unpaid housing at rate of 15% of wages paid for period worked. 5. The 2nd respondent and the claimants to compute and present to the court the payable sums for recording as an order of the court within 45 days. Mention on 21st September for further orders. 6. The claimants are awarded costs of the court and interest at court rate from date of judgment. 7. It is so ordered. DATED, SIGNED, AND DELIVERED IN OPEN COURT AT NAIROBI THIS 3RD DAY OF JULY, 2026. JEMIMAH KELI, JUDGE. IN THE PRESENCE OF: Court Assistant: Otieno Claimants: Ms Kubai 1st Respondent: Bett h/b Mrs Opiyo 2nd Respondent: Chepkoech