IMPORTANT FEATURES OF A LIMITED LIABILITY PARTNERSHIPS ("LLPs")

A Limited Liability Partnership combines the features/elements of a Company and the more traditional partnership, this is because it offers limited liability thus protection to its partners the same as a Company does to its shareholders.

The important features of a Limited Liability Partnership are as below:

• LIMITED LIABILITY

This is an important feature of an LLP as the liability of the partners is Limited, hence a partner in the LLP is not personally liable directly or indirectly for obligations  in the partnership, however individuals are liable for their own wrongful acts or omissions.This defers from the general partnerships where liability of partners is usually unlimited.

•  MEMBERS

A limited liability partnership must have at least two partners and one manager. The manager must be a natural person and above the age of eighteen (18) years.

• SEPARATE LEGAL ENTITY

The business usually acquires a corporate identity distinct from its members. This is a great advantage over the general partnership as it can enter into contracts in its own name, hold property in its own name and it can sue and be sued in its own name.The death or exit of a partner does not affect the existence of the Limited Liability Partnership. 

• TAXATION

Taxation in a Limited Liability Partnership is usually on an individual level and not the entity level hence the members in a Limited Liability Partnership are  deemed self-employed and hence each partner will declare their profit and pay tax on their share of profit. 

NOTE: For any enquiries on the same please do not hesitate to contact us on legalserviceskenya@gmail.com

BEFORE SIGNING THAT EMPLOYMENT CONTRACT

The Employment Act of Kenya provides that a contract of service for a period equivalent of three (3) months or more should be in writing. It also goes further to state that a written contract of service should contain the following particulars:

• Name, age, permanent address and sex of the employee
• Name of employer
• Date of commencement of employment
• Job description of employment
• Form and duration of contract
• Place of work
• Hours of work
• Remuneration,scale or rate of remuneration, the method of calculating that remuneration and details of any other benefits; 
• Interval at which remuneration is paid;
• the date on which the employee’s period of continuous employment began, taking into account any employment with a previous employer which counts towards that period; and 
• Any other prescribed matter.

Many people fall victim of excitement of a new job opportunity and they fail to read the terms provided in their employment contract, it is only prudent for one to read and understand the employment contract prior to executing/signing the same.

So what exactly should one look out for in an employment contract:

Job Description

This is a very important aspect of an employment contract as it provides for the exact roles of an employee and the duties the employer will or will not require you to do. It is important to ensure that the Job description is specific and reflects the position that you applied for. The Job description should not seem to impose on the employee any added responsibilities or seem to have a wider scope as with this the employee will be required to take on more tasks which are not necessarily in their Job description.

Place of Work

It is important to check out for this term in the employment Contract as the employer may provide for a wide geographical scope, which you may have not agreed to in the first place. If an employee however signs the contract with a wide geographical scope they will be deemed to have agreed to the same and this puts the employee in a tight position as one will be adversely affected if they refused to work in a new location.

Hours of Work

Do not agree to working hours or work patterns that you will come to regret later on. It is always important to check the number of hours that you will be required to work,according to the General Wages Order, normal working hours are 52  per week and 60 hours per week for the night workers,notwithstanding this, the Employment Act provides that an employee shall be entitled to at least one rest day in every period of seven days. Check whether you are required to work weekends and if you will be required to do overtime and if you will be paid for this.

Notice

It is important to check the notice period that it is not top short or too long. The normal notice period is usually one (1) month. A notice period that is too long may hamper plans to look for  new job and a too short notice affects the stability of the employee.

Salary, Benefits and bonuses

It is only prudent to ensure that the employment contract reflects the salary agreed upon with your employer and when exactly you will be paid, check if there any benefits attached such as medical cover, and also bonuses if they are guaranteed or discretionary.

Termination Causes

The terms of termination in the contract should be clear and provide details of how your service as an employee can be terminated.

Restrictive Clauses

These are clauses such as the non-compete clause, the non-poaching clauses which the employer provides in the employment contract to protect his/her business. This clauses can be very restrictive to an employee especially after termination of employment as it can affect future projects undertaken by an employee.

NOTE: For any enquiries on the same please do not hesitate to contact us on legalserviceskenya@gmail.com