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ELRCPartially AllowedIndustrial Cause (Employment Cause) filed 02.04.2013, Nakuru (cause number not stated in judgment)· [2013] KEELRC 725 (KLR)

Maria Wanjehia v Midland Hotel (1977) Ltd [2013] KEELRC 725 (KLR)

Industrial Court of Kenya (Employment and Labour Relations Court)
21 June 2013
1,597 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 ruled the hotel unfairly sacked its HR Manager without notice or hearing, awarding her Kshs.370,000 plus costs.

What this practically means

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Executive summary

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The claimant, Maria Wanjehia, employed as Human Resource Manager of Midland Hotel from 7.12.2011 and confirmed on 7.03.2012, sued for a finding that her termination was unjustified, unlawful and unfair, plus statutory entitlements and terminal dues with interest and costs. The respondent sought dismissal of the claim. The parties were directed to attempt settlement and, failing agreement, the case was to be determined on the documents filed; no consent was reached and judgment was delivered on 21.06.2013. The court framed two issues: whether the termination was unfair, and whether the claimant was entitled to the remedies prayed. It held that under section 41 of the Employment Act, 2007 the respondent was required to notify the claimant of the reasons for intended termination and to hear her; no such notice or hearing occurred, breaching the fair procedure envisaged under section 45(2)(c), so the termination was unfair. The reasons advanced by the respondent - poor HR planning, circulating benefits of summarily dismissed staff, and loss of trust - were unilateral allegations never investigated or established in a fair disciplinary process and were therefore not genuine under section 43. The court awarded Kshs.300,000/= as compensation (six months' gross salary at Kshs.50,000/= per month), Kshs.10,000/= for six untaken leave days, Kshs.50,000/= as one month's pay in lieu of notice under section 35(1)(c) read with section 36 (gross pay, not basic pay, following its own earlier decision in Fredrick Ngari Muchira & Others v Pyrethrum Board of Kenya), and Kshs.10,000/= contractual leave allowance. Judgment was entered for the claimant for a declaration of unfair termination and a total of Kshs.370,000/= payable by 1.09.2013, failing which interest would run from the date of judgment until full payment, with costs to the claimant. The claim succeeded substantially but not all heads as prayed were awarded.

Key legal issues

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01

Whether the termination was procedurally fair under sections 41 and 45(2)(c) of the Employment Act

Holding

Termination was unfair because no notice to explain or hearing was given

Reasoning

Section 41 required the employer to notify the claimant of the reasons for intended termination and to hear her. No such notice or hearing occurred; the termination letter issued by e-mail without a disciplinary process. The notification of reasons and hearing constitute the fair procedure under section 45(2)(c), which was breached.

p. 3
02

Whether the reasons for termination were genuine under section 43

Holding

The alleged reasons were not genuine as they were never investigated or established in a fair disciplinary process

Reasoning

The respondent relied on unilateral allegations - poor HR planning, circulated benefits for summarily dismissed staff, loss of trust - but none were investigated or established through a fair process. The court therefore found the reasons not genuine under section 43 and awarded the equivalent of six months' gross salary as compensation for the unfair termination.

p. 3
03

Quantum of pay in lieu of notice - gross or basic pay

Holding

One month's gross salary of Kshs.50,000/= awarded, not basic pay

Reasoning

The contract was monthly and silent on notice; section 35(1)(c) read with section 36 applied. Section 36 defines the pay as remuneration, which includes allowances. The court upheld its earlier meaning of remuneration as gross pay including salary, allowances and benefits, rejecting the respondent's submission based on basic pay of Kshs.40,608/=.

p. 3
04

Leave days and leave allowance

Holding

Kshs.10,000/= for 6 untaken leave days and Kshs.10,000/= contractual leave allowance awarded

Reasoning

The contract provided 30 days annual leave; the claimant took 24 leave days and 4 sick days, leaving 6 days due, valued at Kshs.10,000/=. Clause 3 of the contract provided a leave allowance of Kshs.10,000/= which the respondent did not prove was paid, so the claimant was entitled as submitted.

p. 3

Legal principles established

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  • Notification of the reason for termination and a hearing constitute the fair procedure envisaged under section 45(2)(c) of the Employment Act
  • Unilateral allegations by an employer must be investigated and established in a fair disciplinary process to be genuine reasons under section 43
  • Remuneration for purposes of pay in lieu of notice means gross pay including allowances, not basic pay

Court orders

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  1. 1.A declaration that the termination of the claimant's employment by the respondent was unfair
  2. 2.The respondent to pay the claimant a sum of Kshs.370,000/= by 1.09.2013, failing which interest to be payable from the date of the judgment till full payment
  3. 3.The respondent to pay the costs of the case

Authorities

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Legislation

  • Employment Act, 2007section 41
  • Employment Act, 2007section 45(2)(c)
  • Employment Act, 2007section 43
  • Employment Act, 2007section 35(1)(c)
  • Employment Act, 2007section 36

Cases cited (1)

  • Fredrick Ngari Muchira, Howard Kipkoech Korir and 98 Others –Versus- Pyrethrum Board of Kenya
    Industrial Cause No. 16 of 2013 at Nakuru
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 (employment relationship between the parties)

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, "Maria Wanjehia v Midland Hotel (1977) Ltd [2013] KEELRC 725 (KLR)", Case Analysis (2013). Industrial Cause (Employment Cause) filed 02.04.2013, Nakuru (cause number not stated in judgment). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2013/725/eng@2013-06-21

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