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ELRCAllowedCause No 594 of 2010· [2012] KEELRC 267 (KLR)

JOSEPH OKELO ADHIAMBO & another v Y.J. ELMI & 2 others [2012] KEELRC 267 (KLR)

Industrial Court of Kenya
26 October 2012
HWHellen Wasilwa
957 words in judgment
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The bottom line

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A Kenyan court ruled that two fuel station workers were employees despite no appointment letters, and dismissed on suspicion without a hearing was unfair.

What this practically means

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Executive summary

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Two Claimants, represented by the Kenya Petroleum Oil Workers Union, claimed terminal dues against three Respondents trading as Starehe Total Service Station, alleging employment from 1st January 2007 to 31st January 2010 and termination on suspicion of cheating without payment of dues under Section 35(1)(c) of the Employment Act. Having never received appointment letters, they swore affidavits and gave oral evidence. The Respondents denied ever employing the Claimants; the 2nd Respondent asserted he took over management as Director only in 2009 and claimed the Claimants presented forged documents and could not communicate with customers. The court framed three issues: employment relationship, unfair termination, and remedies. It inferred an employment relationship from salary advance annexures naming the Claimants, which the Respondents never commented on, and from guarantor undertakings in the Respondents' custody which they could not explain. The court held the failure to issue appointment letters concealed terms of service and amounted to an unfair labour practice contrary to Article 41(1) of the Constitution. On termination, applying Section 45(2)(c), it found dismissal on suspicion of wrongdoing without a hearing unfair. Under Section 49(1), judgment was entered for each Claimant based on 2010 minimum wages: one month's salary in lieu of notice (Kshs. 9,120) and six months' compensation for wrongful termination (Kshs. 54,720), totaling Kshs. 63,840 per Claimant. Each party was ordered to bear its own costs.

Key legal issues

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01

Existence of employment relationship

Holding

The Claimants were employees of the Respondents notwithstanding the absence of appointment letters

Reasoning

The court inferred the employment relationship from salary advance annexures naming the Claimants as recipients, which the Respondents never contested, and from guarantor undertaking documents dated 2008 and 2009 held by the Respondents, who could not explain how they possessed documents of persons not in their employ. The burden lay on the Respondents to issue appointment letters.

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02

Unfair termination

Holding

The Claimants' services were terminated unfairly

Reasoning

The Claimants were sent away on suspicion of cheating without any hearing. Under Section 45(2)(c) of the Employment Act, termination without adherence to fair procedure is unfair. With no written contract, the court applied the minimum statutory terms of the Employment Act 2007 to the relationship.

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Remedies

Holding

Each Claimant awarded one month's notice pay and six months' compensation under Section 49(1) of the Employment Act, totaling Kshs. 63,840 each

Reasoning

Section 49(1) of the Employment Act 2007 lists remedies for unfairly terminated employees. The court computed the award on minimum wages for 2010: one month salary in lieu of notice (Kshs. 9,120) and six months' compensation for wrongful termination (Kshs. 54,720), per Claimant.

p. 2

Legal principles established

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  • An employment relationship may be inferred from documentary evidence such as salary advance records and documents in the employer's custody, even absent appointment letters
  • Termination of an employee on suspicion of wrongdoing without a hearing is unfair under Section 45(2)(c) of the Employment Act
  • Failure to issue letters of appointment, leaving terms and conditions of service undocumented, constitutes an unfair labour practice contrary to Article 41(1) of the Constitution

Court orders

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  1. 1.Judgment entered for each Claimant on the basis of minimum wages for 2010
  2. 2.One month salary in lieu of notice of Kshs. 9,120 for each Claimant
  3. 3.Six months' compensation for wrongful termination of Kshs. 54,720 (9,120 x 6) for each Claimant
  4. 4.Total award of Kshs. 63,840 for each Claimant
  5. 5.Each party to bear its own costs

Authorities

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Legislation

  • Employment ActSection 35(1)(c)
  • Employment Act 2007Section 45(2)(c)
  • Employment Act 2007Section 49(1)
  • Constitution of KenyaArticle 41(1)
Jurisdiction invoked
Employment and labour relations dispute under the Employment Act 2007 (first-instance Industrial Court claim; Article 41(1) of the Constitution invoked on unfair labour practice)

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (6)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "JOSEPH OKELO ADHIAMBO & another v Y.J. ELMI & 2 others [2012] KEELRC 267 (KLR)", Case Analysis (2012). Cause No 594 of 2010. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2012/267/eng@2012-10-26

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.