[2018] KEELRC 867 (KLR)

REPUBLIC OF KENYA

IN THE EMPLOYMENT AND LABOUR RELATIONS COURT

AT NAIROBI

CAUSE NO. 1081 OF 2015

CONSOLIDATED WITH CAUSE NO. 1986 OF 2016

(Before Hon. Lady Justice Maureen Onyango)

KENYA HOTELS AND ALLIED WORKERS UNION........................CLAIMANT

VERSUS

THE PANARI HOTEL....................................................................1ST RESPONDENT

THE JACARANDA HOTEL.........................................................2ND RESPONDENT

THE SUNSET HOTEL...................................................................3RD RESPONDENT

SOUTHERN SUN HOTEL............................................................4TH RESPONDENT

SIANA SPRINGS HOTEL.............................................................5TH RESPONDENT

THE FAIRMONT GROUP OF HOTELS....................................6TH RESPONDENT

SERENA GROUP OF HOTELS...................................................7TH RESPONDENT

THE SAFARI PARK HOTEL........................................................8TH RESPONDENT

THE BOMA HOTEL......................................................................9TH RESPONDENT

SUNA AFRICA HOTEL..............................................................10TH RESPONDENT

NAIROBI HILTON HOTEL.......................................................11TH RESPONDENT

AND

KUDHEIHA WORKERS..................................................1ST INTERESTED PARTY

KENYA HOTEL KEEPERS AND

CATERERS ASSOCIATION............................................2ND INTERESTED PARTY

RULING

Judgment in this case was delivered by Ndolo J. on 27th January 2017.

The court ordered as follows –

1. “The Court was therefore unable to understand under what circumstances an employer would recover VAT from its employees.

2. Consequently, the Court finds the Respondents' action of recovering VAT from its employees not only unlawful but also unreasonable and directs that any such charges must stop forthwith.

3. I however withhold my decision on the prayer for recovery of past charges pending filing of particulars by the aggrieved employees.

4. I direct that each party will bear its own costs.”

Pursuant to the said orders, the successful claimant filed the application dated 19th April 2017 seeking the following orders –

1. That the court be pleased to order the 3rd, 5th to the 11th respondent and two members of the 2nd Interested Party to avail the record for the 16% VAT on their employees service charge to the applicant within seven days for the period they unlawfully levied.

2. That the costs of this application be paid by the above mentioned respondents in paragraph one.

The grounds for filing the application is that the applicant engaged all the respondents to avail and ascertain the records of the unlawful deductions of 16% VAT on employees service charge but the 3rd, 5th to 11th respondents, Golden Jubilee Limited T/A Crown Plaza Hotel, Azuri Limited T/A Royal Orchid Hotel, members of the 2nd Interested Party declined to provide the records.

Upon the failure of the respondents to avail the records, the claimant applied its own resources to source for the information which it filed in court as follows –

Nairobi Serena Individual VAT claim............... Kshs.9,898,126. 84

Panari Hotel....................................................... Kshs.10,492,572. 96

Southern Sun Mayfair Nairobi.......................... Kshs.15,191,105. 26

The Jacaranda Hotel......................................... Kshs.19,422,764. 74

Only the 6th respondent responded to the application by filing both a replying affidavit of MBITHE WAMBUA, its Group Director, Talent and Culture and written submission. I am satisfied from the said affidavit and submissions that the 6th respondent Fairmount Group of Hotels does not charge VAT on service charge as demonstrated in the sample payslips annexed to the replying affidavit.

All the other hotels have failed to submit their records or to comment on the records filed by the claimant pursuant to the orders of the court, which permitted the claimant to file particulars of claims by the aggrieved employees.

I therefore enter judgment in favour of the aggrieved employees against the respondents as follows –

1. Panari Hotel.................................................. Kshs.10,492,572. 96

2. The Jacaranda Hotel..................................... Kshs.19,422,764. 74

3. Southern Sun Mayfair Nairobi..................... Kshs.15,191,105. 26

4. Nairobi Serena Individual VAT claim.......... Kshs.9,898,126. 84

The details are as particularised in the records submitted by the claimant.

DATED, SIGNED AND DELIVERED AT NAIROBI ON THIS 26TH DAY OF OCTOBER 2018

MAUREEN ONYANGO

JUDGE