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ELRCPartially AllowedCause Number 1265 of 2012· [2014] KEELRC 667 (KLR)

Daniel Musyoki Mutua v Wema Technical Services [2014] KEELRC 667 (KLR)

Industrial Court of Kenya
12 February 2014
JRJames Rika
837 words in judgment
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The bottom line

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What this practically means

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Executive summary

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The Industrial Court at Nairobi, Rika J, determined an employment dispute in which Daniel Musyoki Mutua, a Driver employed by Wema Technical Services from September 1998 at a monthly salary of Kshs. 17,000, claimed his contract was unfairly terminated on 9th June 2012. He sought notice pay, severance pay, 294 days' annual leave pay, unremitted N.S.S.F contributions, and twelve months' salary for unfair termination, totalling Kshs. 519,400. The Respondent denied the employment relationship, alternatively asserting desertion. The Court noted the dispute mirrored Cause Number 1262 of 2012 (Cosmas Mutua Kimatu v Wema Technical Services Limited) decided on 21st January 2014, observing the files ideally should have been consolidated. On the evidence, including M-pesa statements and the Director's own testimony, the Court found a regular employment relationship existed; Section 37 of the Employment Act 2007 converted the engagement from casual to regular employment given the cumulative years worked. The Director's evidence that he 'stopped giving the Claimant more work' was held to be termination, a 'mere play of words' to the contrary notwithstanding. Diminished business meant a redundancy occurred, attracting severance pay of 15 days' salary per completed year (Kshs. 127,500 for 13 years). The Respondent failed to comply with Sections 40, 43 and 45 of the Employment Act 2007, rendering the termination unfair and warranting two months' salary compensation (Kshs. 34,000). Leave pay of Kshs. 166,000 and notice pay of Kshs. 17,000 were allowed. The N.S.S.F claim of Kshs. 12,800 was rejected for lack of explanation. The Respondent was ordered to pay Kshs. 344,500 within 52 days and release the certificate of service forthwith; no orders on costs and interest.

Key legal issues

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01

Existence of a regular employment relationship

Holding

The Parties were in a regular employment relationship from 1998; the Claimant was not a casual employee.

Reasoning

The Respondent's Director confirmed engaging the Claimant as a Driver from 1998. M-pesa statements showed consistent deposits into the Claimant's account. Section 37 of the Employment Act 2007 converted the Claimant's engagement into regular employment given the cumulative years worked.

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02

Whether there was a termination of employment

Holding

The Respondent's director's statement that he stopped giving the Claimant work amounted to termination; the claim of no termination was a mere play of words.

Reasoning

Raphael testified he stopped giving the Claimant more work in June 2012. The Court held that any termination involves cessation of work, and that the Respondent's framing was simply another way of describing termination of the contract of employment.

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03

Fairness of termination and redundancy

Holding

The Respondent did not observe the termination and redundancy law under Sections 40, 43 and 45 of the Employment Act 2007; termination was unfair and compensation of 2 months' salary was granted.

Reasoning

The Respondent experienced diminished work, creating a redundancy situation, but failed to follow the statutory procedure in Sections 40, 43 and 45. The Court awarded severance pay at 15 days' salary per completed year, and two months' salary as compensation for the unfair termination.

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Legal principles established

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  • A person engaged over a cumulative number of years is, by virtue of Section 37 of the Employment Act 2007, converted into a regular employee rather than a casual employee.
  • Stopping giving an employee more work constitutes termination of employment, not merely a cessation of work.
  • Diminished business justifying cessation of work amounts to a redundancy, for which severance pay of 15 days' salary per completed year of service is awardable.

Court orders

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  1. 1.The Respondent shall pay the Claimant severance pay at Kshs. 127,500; leave pay at Kshs. 166,000; notice pay at Kshs. 17,000; and compensation at Kshs. 34,000 – total Kshs. 344,500
  2. 2.This sum shall be paid within 52 days of the delivery of this Award
  3. 3.The Respondent shall release the certificate of service to the Claimant forthwith
  4. 4.No orders on the costs and interest

Authorities

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Legislation

  • Employment Act 2007Section 37
  • Employment Act 2007Sections 40, 43 and 45
Jurisdiction invoked
Industrial Court jurisdiction under the Industrial Court Act over employment disputes; issues arising under the Employment Act 2007

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, "Daniel Musyoki Mutua v Wema Technical Services [2014] KEELRC 667 (KLR)", Case Analysis (2014). Cause Number 1265 of 2012. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2014/667/eng@2014-02-12

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