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ELRCPartially AllowedIndustrial Court Cause (Nairobi), Memorandum of Claim dated 8th February 2010· [2014] KEELRC 351 (KLR)

John Mwanzia Mbithuka v Mr. Mukesh Malde (Managing Director) & Another [2014] KEELRC 351 (KLR)

Industrial Court of Kenya (Employment and Labour Relations Court)
16 July 2014
1,079 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan employee unfairly dismissed without a valid reason or a fair hearing won compensation, showing employers must justify and properly hear out dismissals.

What this practically means

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Executive summary

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The Claimant, employed on a permanent basis in 1989 and working as a machine attendant, was summarily dismissed on 1st October 2005 by a letter alleging gross misconduct. He sued in 2010 seeking notice pay, leave pay, shift allowance, service gratuity for 20 years and 12 months' salary as compensation for unlawful and unfair dismissal. The Respondents raised preliminary objections, which the court dismissed, holding that the suit was governed by the repealed Employment Act Cap 226, was filed within six years and therefore not statute barred under the Limitation of Actions Act, and was competent by virtue of Section 93(1) of the Employment Act 2007 transitional provisions. Decisions relied on by the Respondent were held to have been made per incuriam of those transitional clauses. At trial, the Claimant testified that he was not told the misconduct alleged and had no opportunity to defend himself; the Respondents called no witness, leaving his testimony wholly uncontroverted. The court found the dismissal unlawful and unfair, both for lack of a valid reason and absence of fair procedure. It awarded one month's notice pay (Kshs.13,650), ten months' salary as compensation (Kshs.130,500) and leave pay for six years at 21 days per year (Kshs.57,330), totalling Kshs.207,480 with interest at court rates. Claims for service gratuity and shift allowance were dismissed as unproved, the Claimant having been registered with NSSF and his payslip showing shift allowance payments. Costs were awarded to the Claimant.

Key legal issues

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01

Applicability of the repealed Employment Act Cap 226 and limitation

Holding

The suit is governed by the repealed Employment Act Cap 226 and is not statute barred, being filed within six years under the Limitation of Actions Act; the transitional provisions of the Employment Act 2007 render the suit competent.

Reasoning

The court applied the transitional provisions of the Employment Act 2007, which preserved suits and causes arising under the repealed Cap 226, subjecting them to the 2007 Act only where consistent. The cause of action arose on 1st October 2005 and the suit was filed on 8th February 2010, within the six-year limitation period under the Limitation of Actions Act Cap 22.

p. 1
02

Unlawful and unfair termination

Holding

The dismissal was unlawful and unfair as no valid reason was established and no fair procedure was followed; the Claimant was not given a hearing.

Reasoning

The Claimant was summarily dismissed by letter alleging gross misconduct but was never told the misconduct he had committed and had no opportunity to defend himself. The Respondents called no witness to rebut his testimony, which therefore remained wholly uncontroverted. The court found no valid reason and no fair procedure, awarding notice pay and ten months' salary as compensation.

p. 3
03

Service gratuity and shift allowance

Holding

Both claims failed: gratuity was not payable because the Claimant was registered with NSSF, and shift allowance was already paid as evidenced by the payslip.

Reasoning

Although the Claimant claimed gratuity for 20 years and shift allowance, his own evidence and documents contradicted the claims. Registration with NSSF excluded service gratuity, and the payslip he produced showed shift allowance payments. The court dismissed both heads, illustrating that unproved claims fail even where the core termination claim succeeds.

p. 3

Legal principles established

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  • Under the transitional provisions of the Employment Act 2007, pre-2007 contracts of employment are read and construed subject to the provisions of the 2007 Act where inconsistent
  • A summary dismissal without a valid reason and without fair procedure is unlawful and unfair and attracts compensation

Court orders

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  1. 1.Dismissal of the preliminary objections
  2. 2.Award against the 1st and 2nd Respondents jointly and severally of Kshs.13,650 being one month's salary in lieu of notice
  3. 3.Award of Kshs.130,500 being ten months' salary as compensation for unlawful and unfair termination
  4. 4.Award of Kshs.57,330 being payment in lieu of leave days not taken for six years at 21 days per completed year
  5. 5.Interest at court rates from date of judgment until payment in full
  6. 6.Respondents to pay the costs of the suit

Authorities

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Legislation

  • Employment Act Cap 226 (repealed)whole Act
  • Limitation of Actions Act Cap 22general
  • Employment Act 2007Section 93(1) and 93(1)(A) (Transitional Provisions)
  • Trade Disputes Actright of appeal referred to in dismissal letter

Cases cited (2)

  • Erastus Njoroge Vs. English Press Limited
    Industrial Court Cause No. 1378 of 2011
  • Ayub Asamba Vs. Telkom (K) Limited
    Industrial Cause No. 164 (N) 2009
Jurisdiction invoked
Industrial Court jurisdiction under the Employment Act 2007 transitional provisions (Section 93(1)) and the Limitation of Actions Act Cap 22

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, "John Mwanzia Mbithuka v Mr. Mukesh Malde (Managing Director) & Another [2014] KEELRC 351 (KLR)", Case Analysis (2014). Industrial Court Cause (Nairobi), Memorandum of Claim dated 8th February 2010. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2014/351/eng@2014-07-16

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