Court orders Telkom to pay staff sacco Sh51m

Orange Telkom shop at the Teleposta towers in Nairobi. Telkom Kenya has been ordered to pay Sh51 million to a co-operative society for charges relating to its employees’ unpaid loans. FILE 

In Summary

• In an earlier ruling, a judge ruled in favour of Telkom after it presented a bill for taxation that is now pending before the deputy registrar of the High Court.

Telkom Kenya has been ordered to pay Sh51 million to a co-operative society for charges relating to its employees’ unpaid loans.

The order comes after Mawasiliano Sacco Society Limited moved to court challenging a decision made in favour of Telkom that halted payment of the loan dues.  At the centre of the tussle was the deduction and submission of co-operative loan charges owed by Telkom staff to the sacco.

In an earlier ruling, a judge ruled in favour of Telkom after it presented a bill for taxation that is now pending before the deputy registrar of the High Court.

Telkom had argued that, “pending the hearing and determination of the application there be a stay of the taxation.”

“The issue for consideration is which party is liable to settle costs after the determination of a judicial review application,” Justice David Majanja said.

Adding: “The judgment was delivered pursuant to a notice of motion filed in court on May 19, 2011 in which Telkom Kenya sought various orders against the commissioner of co-operative development.”

Justice Majanja said that on May 6, 2011, P. N. Gichuhi acting on behalf of the commissioner issued a notice under the co-operative societies Act, requiring Telkom to make an appropriate proposal on how to pay Sh51,062,660 owed to Mawasiliano.

The notice was followed by agency notices issued to Telkom bankers requiring the firm to pay the commissioner.

Telkom contested the notices arguing that there was no basis for issuing the notices by the commissioner on behalf of Mawasiliano and further noting that it did not have any instructions to deduct any monies from its employees’ emoluments.

Mawasiliano had submitted that if costs were awarded to Telkom, they could only be paid by the commissioner of co-operatives development, being the body responsible for the infraction and that Mawasiliano should not be burdened with the costs as it only appeared in the matter due to the interest it had in the outcome of the case.

Justice Majanja said that while there might have been circumstances that Mawasiliano Sacco may be liable to pay costs, the learned judge did not address the issue in the judgment.

He therefore held that the Sacco is not liable for the applicant’s costs in the circumstances of that case.