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ELRCPartially AllowedCause 1124 of 2011· [2013] KEELRC 344 (KLR)

SETH NAMUNYANYI MAHIGA V HEALTHY U 2000 LIMITED [2013] KEELRC 344 (KLR)

Industrial Court of Kenya
25 April 2013
MOMaureen Onyango
2,009 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan court awarded a dismissed employee over Kshs.381,000 because his employer failed to follow mandatory procedures under the Employment Act.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent, sued for wrongful and unlawful termination of his employment, seeking pay in lieu of notice, salary for March and April 2011, 15 days' pay per year for two years, three months' leave pay, overtime, house allowance, damages for unlawful dismissal, overtime on holidays and Sundays, and NSSF remittance arrears. The Respondent maintained that the Claimant was employed in October 2008 as a Shelf Attendant on a gross salary of Shs.14,000 and was summarily dismissed on 4th April 2011 for gross misconduct, poor disciplinary record and absenteeism, with notice and an opportunity to be heard. The Claimant testified he was employed on 2nd August 2008 as a Health Advisor at Shs.16,265 and that his termination letter, dated 4th April 2011, cited restructuring and was backdated. The court framed four issues: date of employment, whether salary was gross or basic, whether dismissal was summary or on grounds of restructuring, and entitlement to reliefs. It found the Claimant's letters of appointment and termination genuine, that his salary was consolidated (inclusive of house allowance), and that on either version of the termination letter the termination was unfair because neither complied with Sections 40 or 41 of the Employment Act. The court awarded pay in lieu of notice, March and April salary, leave pay for 36.75 days, normal overtime and public holiday overtime, and three months' salary as compensation, total Kshs.381,442.08, and dismissed the claims for 15 days' pay per year, house allowance and NSSF remittance. The Respondent was ordered to pay the Claimant's costs.

Key legal issues

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01

Date and position of employment

Holding

The Claimant was employed on 2nd August 2008 as a Health Advisor, not October 2008 as a Shelf Attendant

Reasoning

The Respondent's payslips for June, July and August 2010 already described the Claimant as Health Advisor, contradicting the witness's claim that the position was introduced in August 2010. The Respondent's letter of appointment referred only to 'Oct' '08' without a specific date, which the court found inconceivable for a genuine letter, so the Claimant's letter was believed.

p. 3
02

Whether termination was unfair

Holding

On either version of the conflicting termination letters, the termination was unfair

Reasoning

The court could not determine which of the two conflicting termination letters was genuine, but held that both versions offended the Employment Act: the Claimant's version (restructuring/redundancy) failed to comply with Section 40, and the Respondent's version (summary dismissal) failed to comply with the hearing requirement of Section 41. Unfair termination was therefore established regardless of which letter was authentic.

p. 3
03

Overtime entitlement

Holding

The Claimant worked 14 hours of overtime per week and is awarded Kshs.217,083.53, plus double-rate overtime for 27 public holidays (Kshs.46,843.92)

Reasoning

The Respondent confirmed the Claimant worked 11 hours a day from 6.30 a.m. to 6.30 p.m. Against a maximum of 52 hours per week under the Regulation of Wages and Conditions of Employment (General) Order, and allowing one rest day weekly, this yielded 14 overtime hours weekly over 143 weeks, computed at 1.5 times the daily rate. The Respondent did not deny work on public holidays, 27 of which were counted and awarded at double rate.

p. 4
04

Compensation for unfair termination

Holding

Three months' salary (Shs.48,795) awarded as compensation rather than the maximum twelve months

Reasoning

Having found unfair termination, the court applied Section 49 of the Employment Act. Considering the Claimant's 33 months of service, twelve months' maximum compensation was considered excessive; three months' salary was held adequate. One month's pay in lieu of notice was also awarded under Section 49(1)(a).

p. 4

Legal principles established

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  • A summary dismissal that does not comply with the hearing requirement of Section 41 of the Employment Act is unfair termination
  • A redundancy not effected in line with Section 40 of the Employment Act constitutes unfair termination
  • NSSF underpayments can only be claimed by NSSF itself, not by an employee

Court orders

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  1. 1.Pay in lieu of notice Shs.16,265
  2. 2.Salary for March/April 2011 Shs.32,530
  3. 3.Annual leave Shs.19,924.63
  4. 4.Normal overtime Shs.217,083.53
  5. 5.Compensation for unfair dismissal Shs.48,795
  6. 6.Overtime on public holidays Shs.46,843.92
  7. 7.Total award of Kshs.381,442.08
  8. 8.The Respondent to pay the Claimant's costs

Authorities

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Legislation

  • Employment ActSection 40
  • Employment ActSection 41
  • Employment ActSection 49(1)(a)
  • Employment ActSection 28
  • Regulation of Wages and Conditions of Employment (General) OrderOrder 6
Jurisdiction invoked
Employment and labour relations jurisdiction of the Industrial Court (Cause under a Memorandum of Claim)

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "SETH NAMUNYANYI MAHIGA V HEALTHY U 2000 LIMITED [2013] KEELRC 344 (KLR)", Case Analysis (2013). Cause 1124 of 2011. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2013/344/eng@2013-04-25

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