Next Generation Communication Ltd v George M. Kirungaru [2019] KECA 409 (KLR)
The bottom line
#Kenya's Court of Appeal confirmed that employees registered with NSSF are not entitled to service pay under the Employment Act.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether an employee who is a member of the National Social Security Fund (N.S.S.F.) is entitled to service pay under section 35 of the Employment Act, 2007
- 2.Whether service pay could be awarded to an employee who had resigned rather than been declared redundant
- 3.Whether the trial Judge could award service pay where it had not been pleaded or prayed for in the memorandum of claim
Key legal issues
#Entitlement to service pay where the employee is an N.S.S.F. member
Section 35 of the Employment Act bars payment of service pay to an employee who is a member of N.S.S.F.; the respondent's proved N.S.S.F. membership disentitled him to service pay.
The trial Judge found as fact that the respondent was a member of N.S.S.F. with monthly remittances made by the appellant. The court held that section 35 of the Employment Act specifically declares that an employee who is a member of N.S.S.F. is not entitled to service pay, so the award of service pay was contrary to statute regardless of the mode of computation adopted below.
Award of relief not pleaded or claimed
A specific claim of Kshs. 330,000 could not support an award of Kshs. 330,369 as service pay, which was neither prayed for nor proved.
The memorandum of claim asserted entitlement to accrued dues of Kshs. 330,000 but contained no prayer for service pay. The court held that a specific claim must be properly pleaded and proved, and a Judge cannot award what was not prayed for or proved. The trial Judge's award of a higher, differently computed sum was therefore erroneous.
Applicability of service pay provisions to a resigning employee
Service pay provisions could not be applied to the respondent who had resigned and was never declared redundant; adopting section 40 of the Employment Act for computation was an error.
The appellant contended that the trial Judge erred in adopting section 40 of the Employment Act to compute service pay when the respondent had resigned and had not been declared redundant. The respondent admitted he resigned and his resignation was accepted, ending the contract of employment. This supported the court's conclusion that no service pay was due.
Legal principles established
#- An employee who is a member of N.S.S.F. is not entitled to service pay under section 35 of the Employment Act
- A court cannot award a sum that was not pleaded, prayed for or proved in the claim
Court orders
#- 1.The appeal is allowed
- 2.The award of service pay of Kshs. 330,369 made by the then Industrial Court is set aside in its entirety
- 3.The claim is dismissed
- 4.Costs of this appeal and costs below are awarded to the appellant
The bench
#One judgment of the whole court — no separate or dissenting opinions.
- On appeal from
- Employment & Labour Relations Court at Nairobi
- H.C. Cause No. 1632 of 2012
- Jurisdiction invoked
- First appeal from the Employment and Labour Relations Court (Employment and Labour Relations Court Act jurisdiction)
Relief refused
#Service pay as awarded by the trial court
The respondent was a member of N.S.S.F. and the Employment Act disentitled him to service pay; further, service pay was not pleaded or prayed for
Costs
Costs of this appeal and costs below awarded to the appellant
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
Section 35 of the Employment Act specifically declares that an employee who is a member of N.S.S.F is not entitled to service pay.
It was a specific claim which needed to be properly pleaded and proved and the Judge could not award that which was not prayed for or proved.
We set aside the award of service pay of Kshs.330,369 made by the then Industrial Court in its entirety and order that the claim be dismissed. We award costs of this appeal and costs below to the appellant.
Issues in the judgment
#The appeal coram states the judgment below was dated 12th April 2014, but the body of the judgment records that Rika, J. delivered an Award on 12th February 2014.
The judgment misdescribes the court below at one point: the appeal is from the Employment & Labour Relations Court, yet the final orders refer to the then Industrial Court.
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Next Generation Communication Ltd v George M. Kirungaru [2019] KECA 409 (KLR)", Case Analysis (2019). Civil Appeal No. 148 of 2015. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2019/409/eng@2019-07-19
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.