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ELRCPartially AllowedCause No 187 of 2013· [2014] KEELRC 133 (KLR)

Michael Wambua Masaku v Malken Housing System Limited [2014] KEELRC 133 (KLR)

Industrial Court (Employment and Labour Relations Court)
13 November 2014
3,446 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 an employer's summary dismissal unlawful because it skipped the mandatory show cause letter and hearing, awarding the employee over Kshs.125,000 net.

What this practically means

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Executive summary

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The Claimant, employed as a site clerk from 1st August 2010 and later promoted to site supervisor, was summarily dismissed on 8th January 2013 for allegedly absenting himself from work without leave on 21st December 2012. He claimed the dismissal was wrongful and unfair, seeking twelve months' compensation, notice pay, leave pay, overtime and a certificate of service, with reinstatement in the alternative. The Respondent maintained the dismissal was for gross misconduct following a communicated directive that 21st December was a normal working day, and counterclaimed for unreturned work gear (Kshs.4,590/=) and an unrecovered medical advance (Kshs.68,540/=). The Court found the Claimant's account that he left fifteen minutes early with the verbal permission of the acting site Manager more credible, noting RWI arrived at site after 5 p.m. and the alleged site Manager was not called to testify. No show cause letter was issued and no disciplinary hearing was held. The Court held the dismissal lacked a valid reason contrary to Section 45(1) and breached fair procedure under Sections 41 and 45(2)(c) of the Employment Act. It awarded six months' compensation (Kshs.108,000/=), one month's notice pay (Kshs.18,000/=), leave pay, and overtime of Kshs.53,997.85 for hours worked beyond the contracted 45-hour week. Both counterclaims were proved and Kshs.73,130/= was set off, leaving a net award of Kshs.125,536/= with interest at Court rates. Each party was to bear its own costs as both the claim and counterclaim succeeded.

Key legal issues

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01

Validity of the reason for summary dismissal

Holding

The summary dismissal was not for a valid reason and was contrary to Section 45(1) as read with Section 45(2)(a) of the Employment Act

Reasoning

The Claimant testified he left fifteen minutes early on 21st December 2012 with verbal permission of the acting site Manager after completing his work. RWI arrived after 5 p.m. and had no first-hand knowledge, relying on persons not called to testify. The named site Manager, Kevin Maingi, was not called by either party. The Court gave the Claimant the benefit of doubt and found the dismissal wrongful.

p. 6
02

Procedural fairness of the dismissal

Holding

The dismissal was procedurally unfair as no show cause letter was issued and no disciplinary hearing was held

Reasoning

The evidence established that the Claimant was neither given a show cause letter nor subjected to a disciplinary hearing, contrary to Section 41 of the Employment Act. The alleged meeting with RWI on 8th January 2013 was not supported by records; RW2 had no record of it. Termination without a hearing breached Sections 41 and 45(2)(c) of the Employment Act.

p. 7
03

Entitlement to compensation

Holding

The Claimant was entitled to compensation under Section 49(1)(c); six months' salary was awarded considering his service record, length of service and lack of terminal benefits

Reasoning

Guided by Section 49(4) as read with Section 50, the Court considered that the Claimant was a supervisor with a good record save for one warning, had served about three years, received no certificate of service or terminal benefits, and had already secured new employment. Compensation was fixed at six months' salary of Kshs.108,000/=.

p. 7
04

Overtime claim

Holding

The Claimant proved unpaid overtime for three extra hours worked weekly beyond the contracted 45-hour week, contrary to his contract

Reasoning

The contract provided for 45 hours per week, yet the Claimant worked 8 a.m. to 5 p.m. Monday to Saturday. This evidence was unrebutted, and the Respondent failed to show how the extra hours were factored into the overtime payments shown in the payslips. The claim of Kshs.53,997.85 was established on a balance of probabilities.

p. 7
05

Counterclaim for unreturned equipment and medical advance

Holding

Both counterclaims were proved on a balance of probabilities and set off against the award

Reasoning

The Court found the Claimant did not return tools of trade worth Kshs.4,590/= and that the Respondent proved it advanced Kshs.68,540/= for the Claimant's medical expenses which had not been fully recovered from his salary. The total of Kshs.73,130/= was set off from the award.

p. 8

Legal principles established

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  • An employer must issue a show cause letter and afford an employee an opportunity to be heard before summary dismissal, per Section 41 of the Employment Act
  • An employee discharges the onus under Section 47(5) of the Employment Act by proving on a balance of probabilities that the dismissal was wrongful, shifting the burden to the employer to justify it
  • The employer is obliged to keep and produce leave records to rebut an employee's claim for outstanding leave days

Court orders

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  1. 1.Compensation of Kshs.108,000/= (six months' salary) for unlawful and unfair dismissal
  2. 2.Notice pay of Kshs.18,000/=
  3. 3.Payment in lieu of leave of Kshs.15,900/=
  4. 4.Overtime payment of Kshs.53,997.85/=
  5. 5.Total award of Kshs.198,666/= less counterclaim of Kshs.73,130/=; net award of Kshs.125,536/= to the Claimant
  6. 6.Award to attract interest at Court rates from date of judgment until payment in full
  7. 7.Each party to bear own costs of the suit

Authorities

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Legislation

  • Employment ActSection 41
  • Employment ActSection 45(1), 45(2)(a), 45(2)(c)
  • Employment ActSection 47(5)
  • Employment ActSection 49(1)(c), 49(4)
  • Employment ActSection 50
Jurisdiction invoked
Jurisdiction under the Employment Act (Sections 41, 45, 47(5), 49 and 50) as a first-instance employment and labour relations cause; no specific constitutional provision cited

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, "Michael Wambua Masaku v Malken Housing System Limited [2014] KEELRC 133 (KLR)", Case Analysis (2014). Cause No 187 of 2013. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2014/133/eng@2014-11-13

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