The NSSF ACT of 2013 was designed and enacted to address the above challenges and ensure that workers would retire with dignity. The Employment and Labor Relations Court deemed the Act unconstitutional and put the whole industry in jeopardy.
The Court of Appeal ruled that if proceedings are conducted by a court without jurisdiction, they are nullity, citing the precedence set by Desai v Warsaw (1967) EA 351.
The Court reiterated that any award or judgment and or orders arising from such proceedings of a court acting without jurisdiction are also a nullity. In the Court of Appeal’s wisdom, they found that the judgment of the ELRC was a nullity in total.
The Background
Court of Appeal has rendered a landmark ruling that will see the ordinary worker retire and get benefits that befit them.
The ruling that was rendered on the 3rd of February gives hope and purpose for push for better savings.
The ruling creates the right environment to build upon the needed foundation to push this country towards the essence and culture of saving that is critical to our survival. Let me paint for you a story from data that was collected by Sokodirectory.com during December. The publishing media house found very interesting data: The average Kenyan Middle-Class Person has an average of 7 Mobile Loans and at least 1 bank loan and 1 Sacco Loan.
Middle Class is one illness away from Acute Poverty. Not to mention, they have no savings at all. Remember this is the middle class. So, what about the ordinary, majority of us, who have no access to these mobile loan applications and have zero platforms for sustainable platforms for savings? Where do we run to?
The Zulu have a saying “Umuthi ugotshwa usemanzi” which translates to “a tree is bent while it is still wet”. The meaning of this proverb is that wisdom and behavioral influences are instilled when a person is still young. This means we must decide now and act fast while we can bend our habits into success when it comes to our saving behavior.
I am with the President when he said that we must increase what we save so that we can retire with something tangible in our pockets. If we want to live the same lifestyle when we retire or better, we must sacrifice today.
A better tomorrow means we work hard, smart, and together today. Some of the biggest challenges that Kenyans face when it comes to saving money for a rainy day include:
The NSSF ACT of 2013 was designed and enacted to address the above challenges and ensure that workers would retire with dignity. The Employment and Labor Relations Court deemed the Act unconstitutional and put the whole industry in jeopardy. The National Social Security Fund Board of Trustees appealed the case against the Kenya Tea Growers Association and 14 others and they won meaning the worker has won.
If we implement what needs to be done, the current administration of NSSF will return the dignity that we deserve in our retirement.
The Ruling In Context;
The Court of Appeal ruled that if proceedings are conducted by a court without jurisdiction, they are nullity, citing the precedence set by Desai v Warsaw (1967) EA 351.
The Court reiterated that any award or judgment and or orders arising from such proceedings of a court acting without jurisdiction are also a nullity. In the Court of Appeal’s wisdom, they found that the judgment of the ELRC was a nullity in total.
The Court of Appeal has concluded that the ELRC bench lacked jurisdiction, the only order which commends itself in the circumstances of this case was to allow the appellant’s appeal which they did and, in the process, set aside the judgment of the ELRC delivered on 19th September 2022 in its entirety.
The Court of Appeal concluded without any doubt that the ELRC bench not only failed to analyze the provisions of Articles 109 to 114 of the Constitution, the clear provisions of Parts 1 and 2 of the Fourth Schedule which define the functional areas of both levels of the government, but that they also ignored several decisions of the Appeal Court which have interpreted the said Articles such as Speaker of the National Assembly & another v Senate & 12 Others (supra), Pevans East Africa Limited & Another v Chairman, Betting Control & Licensing Board & 7 others [2018] eKLR and persuasive High Court decisions such as Pevans East Africa Limited & another v Chairman Betting Control and Licensing Board & 7 others (supra) all of which interpreted the same articles.
The Court of Appeal reiterated that the ELRC bench fell into a grave error by failing to establish the true character of the legislation before it satisfies itself that the legislation affects the functions of the county government. The appeal by NSSF was centered on two issues;
The Court of Appeal concluded that the ELRC bench erred by failing to appreciate that the parties citing the alleged unconstitutionality did not rebut this presumption.
The Court of Appeals Bench found that the ELRC bench erred in law by holding the concurrence of the Senate and the National Assembly was required in enacting the impugned legislation. The decision declaring the NSSF Act, 2013 unconstitutional for failure to involve the Senate in its enactment was not supported by the law. On this ground, the Court of Appeal held that the judgment cannot be allowed to stand.
In conclusion, the Court of Appeal stated that having found, as they did earlier, in regards to issue one, that the trial court had no jurisdiction to entertain the matter, they found and held that on this ground, this appeal by NSSF had succeeded. The Court of Appeal set aside the entire judgment dated 19th September 2022 and all the consequential orders. They further ordered that each party shall bear their costs for this appeal.
This is a significant ruling, one that creates the right environment needed to nurture and grow our saving culture. This NSSF Act, 2013 is the catalyst that every worker needs to secure their future.
The ruling fuels the public conversations around the need to protect the dignity of the workers in retirement and ensure that workers retire with millions.
As the country looks forward to a prosperous 2023 and the government sets its goals on reviving the economy, the NSSF management is keen to ensure that they run a modern fund and one which values each member.
Related Content: An increase In NSSF Contributions Will Enhance Your Savings And Secure Your Financial Future
The National Social Security Fund (NSSF) management is keen to ensure that they implement the following measures as captured in their strategy for 2023-2028 to improve its image and ensure better returns to its members by taking the following steps:
By taking these steps, the NSSF of Kenya will improve its reputation and become a more trusted and respected organization in the eyes of its members and the general public. It is my prayer that this ruling will inspire Kenya to have better, structured conversations around the essence of saving and how best to go about it and in the process support the President’s call that it is important for every one of us to save and to work together for better.
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