Patrick Mudaki v Deposit Protection Fund Board [2013] KEELRC 198 (KLR)
The bottom line
#Kenya's Employment Court ruled that a worker treated as a casual for nine years was actually permanent, entitling him to notice and severance pay.
What this practically means
#Executive summary
#Key legal issues
#Identity of the employer
The employer was the Respondent, the Deposit Protection Fund Board, its denial being an afterthought given its settlement of the claim through the Ministry of Labour
The court relied on the letter by the Respondent's Assistant Director, Mrs. L.C. Soi, and on the fact that the Board accepted liability for the claim presented to the Ministry of Labour and paid Kshs.49,000/= in settlement. The defence that the Claimant worked for a Liquidation Agent was rejected as an afterthought, the claim being properly brought against a Board capable of suing and being sued.
Status of the Claimant - casual or permanent employee
Despite being paid and treated as a casual, the Claimant was for all intents and purposes a permanent employee given nine years of continuous service
The court found the work continuous save for a few breaks, that leave was not given (acknowledged during conciliation), and that the Claimant lost benefits that would have accrued under a contract or permanent engagement, including pension, gratuity and severance, because he was not registered with NSSF or NHIF. The casual label did not reflect the reality of the relationship.
Entitlement to severance pay and notice pay
Claimant entitled to severance pay for each completed year of service under Section 35(5) of the Employment Act and one month's salary in lieu of notice, less amounts already paid
Because the employer treated the Claimant and colleagues as casuals, the provisions of the Employment Act, 2007 were not utilized to pay one month's salary in lieu of notice and a minimum of 15 days salary for each completed year of service. The court awarded notice pay net of the Kshs.7,000/= already paid and 15 days' salary per year for nine years.
Lawfulness of the termination
Termination was for operational reasons and was not shown to be unlawful or unfair under Section 45 of the Employment Act
The work was time bound and destined to end upon finalisation of the liquidation of the various bankrupt banks. The Claimant failed to discharge the burden of showing the termination was unlawful or unfair, so no compensation for unfair termination was awarded.
Legal principles established
#- An employee engaged and treated as a casual but serving continuously for a prolonged period is for all intents and purposes a permanent employee entitled to statutory benefits on termination
- An employer who accepts and settles a claim through the Ministry of Labour cannot later deny the employment relationship
Court orders
#- 1.Respondent to pay the Claimant 1 month's salary in lieu of notice in the sum of Kshs.20,000/= less Kshs.7,000/= for 7 days, i.e. Kshs.13,000/=
- 2.Respondent to pay the Claimant 15 days salary for each completed year of service for 9 years (13/10/1999 – 16/01/2009) in the sum of Kshs.135,000/=
- 3.Total award of Kshs.148,000/=
- 4.Costs of the suit to the Claimant
- Jurisdiction invoked
- Employment and labour relations dispute under the Employment Act, 2007 (first-instance Industrial Court claim)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Patrick Mudaki v Deposit Protection Fund Board [2013] KEELRC 198 (KLR)", Case Analysis (2013). Memorandum of Claim dated 19th September, 2011. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2013/198/eng@2013-08-27
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.