Karuga v Nairobi City Water and Sewerage Company Limited & another (Civil Appeal 193 of 2019) [2021] KECA 109 (KLR)
The bottom line
#Kenya's Court of Appeal confirmed that an employee wrongfully suspended and later acquitted must be paid full salary for the entire suspension period.
What this practically means
#Executive summary
#Key legal issues
#Whether the appellant waived/estopped from claiming dues for the suspension period
The appellant did not waive his rights; he was not given a clear opportunity to accept or refuse the conditional reinstatement, and his letters pursuing accrued dues displace any inference of waiver by conduct.
The court applied the test that waiver may arise from conduct evincing an intention to waive a right. The respondents relied on a belated conditional reinstatement letter which the appellant claimed never to have received; there was no communication confirming his agreement to the unpaid-leave condition. His continued letters demanding back pay were inconsistent with waiver. The trial court's finding of estoppel was erroneous.
Whether the claim was time barred under section 90 of the Employment Act
The claim, filed on 30th June 2014, was not time barred; the cause of action accrued when the breach occurred and damage was first sustained, and the trial judge erred in holding otherwise.
Adopting Lord Diplock's definition of cause of action in Letang v Cooper and the holding in Diana Kathumbi Kiio v Reuben Musyoki that a cause of action accrues when the breach occurs and the damage is first sustained, the court held the suit filed on 30th June 2014 was within the limitation period under section 90 of the Employment Act.
Entitlement to salary for the suspension period
The appellant was entitled to his accrued salary and leave allowance for the entire period he was on suspension; the employer acted manifestly unfairly in imposing the unpaid-leave condition and reinstating him to a lower position.
Relying on Circular No. 27/2010 limiting suspension to three months without pay and on Kenya Broadcasting Corporation v Geoffrey Wakio, where an employee whose half salary was withheld during interdiction was held entitled to arrears, the court held the appellant was entitled to salary for the suspension period following his acquittal, and that conditional reinstatement without his consent was manifestly unfair.
Allocation of liability between the 1st and 2nd respondents under the transfer agreement
The burden does not rest on the employee to establish the terms of the transfer agreement between the respondents; the court will not rewrite agreements between parties.
The court noted the transfer agreement dated 4th March 2004, and that the 1st respondent would be liable (if at all) only for the period after the appellant's transfer. However, the burden of proving the agreement's terms rests on the respondents who are parties to it, and the court will not rewrite parties' agreements.
Legal principles established
#- Waiver of a right to claim must be unequivocal, by express words or conduct; it cannot be inferred where the employee continuously pursued his dues and was never given a clear opportunity to accept or refuse the conditions of reinstatement.
- A cause of action for unpaid emoluments accrues when the breach occurs and the damage is first sustained, not at the date of reinstatement where liability is denied later; a claim instituted within three years of that accrual is not statute barred under section 90 of the Employment Act.
- In the clearest of cases the court may order reinstatement without loss of back salary, benefits and privileges (sections 49 and 50 of the Employment Act); an employee wrongfully suspended and later acquitted and reinstated is entitled to salary arrears for the suspension period.
Court orders
#- 1.The appellant is entitled to payment of his salaries for the period he was under suspension
- 2.The claim was not statute barred by effluxion of time
- 3.Costs of the appeal be awarded to the appellant
- On appeal from
- Employment and Labour Relations Court
- ELRC 1088 of 2014
- Jurisdiction invoked
- First appellate jurisdiction over the Employment and Labour Relations Court under the Employment and Labour Relations Court Act and Article 164(1)(a) of the Constitution (implied; not expressly quoted in the judgment)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Karuga v Nairobi City Water and Sewerage Company Limited & another (Civil Appeal 193 of 2019) [2021] KECA 109 (KLR)", Case Analysis (2021). Court of Appeal at Nairobi (ELLC Appeal). Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2021/109/eng@2021-10-22
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.