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ELRCDismissedNot stated in the extract (application arising from Employment and Labour Relations Court cause, judgment of 5th June 2013)· [2014] KEELRC 887 (KLR)

Anne Kirumba Riungu v Telkom Kenya Limited [2014] KEELRC 887 (KLR)

Employment and Labour Relations Court
20 March 2014
2,478 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
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The bottom line

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A Kenyan employer lost its bid to delay paying an unfair termination award because its planned appeal ignored the key finding that fair procedure was missing.

What this practically means

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Executive summary

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The Applicant employer moved the Employment and Labour Relations Court by Notice of Motion dated 1st July 2013 seeking a stay of execution of the decree arising from the judgment of Lady Justice Maureen Onyango delivered on 5th June 2013, which awarded the Claimant gratuity of Kshs.1,735,198.96 and one month's notice pay of Shs.168,424.00. The Applicant intended to appeal against the whole judgment and argued the appeal was arguable, that the award of gratuity rewrote the contract, and that the Claimant lacked means to refund the decretal sum if the appeal succeeded. The Claimant opposed, contending the application was defective for want of a draft memorandum of appeal, that a monetary decree is refundable, and that the application ignored the finding that the termination was procedurally unfair. The court restated the settled conditions for stay: an arguable appeal with a reasonable chance of success, and preservation of the subject matter or avoidance of substantial loss. Although no draft memorandum of appeal had been filed, the court found the grounds sufficiently set out in the supporting affidavit, but held that those grounds had no merit: the judgment had found a valid reason for disciplinary action existed but that fair procedure was not proved, rendering the termination unfair under Section 45 of the Employment Act, whereupon the claimant became automatically entitled to gratuity and notice under Section 49(1) and her contract clauses 15 and 18. The application dwelt only on validity of reason and ignored the procedural limb. The application was dismissed with costs, with liberty to seek stay from the Court of Appeal.

Key legal issues

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01

Whether failure to annex a draft memorandum of appeal is fatal to a stay application

Holding

Not fatal where the grounds of the intended appeal are clearly set out in the supporting affidavit

Reasoning

The court noted that although the respondent had not filed grounds of appeal, paragraph 7 of the supporting affidavit of Caroline Ndindi clearly articulated the three grounds the intended appeal would raise, sufficient to assess arguability. The court then assessed those grounds against the judgment and found them without merit.

p. 3
02

Whether the intended appeal was arguable

Holding

The appeal was not arguable because the application ignored the finding that the termination was unfair for failure to prove fair procedure

Reasoning

The judgment had found a valid reason existed but that fair procedure was not proved, making the termination unfair under Section 45(1) and (2) of the Employment Act. Once unfairness is found, Section 49(1) as read with Section 50 entitles the employee to notice pay and accrued contractual entitlements including gratuity. The application addressed only validity of reason, ignoring the procedural limb, so the appeal had no chance of success.

p. 5
03

Whether the award of gratuity rewrote the employment contract

Holding

No; gratuity was a contractual entitlement under clauses 15 and 18 of the contract, payable once termination was found unfair

Reasoning

Clause 15 provided for gratuity of 31% of total salary on completion of contract, and clause 18 dealt with termination by notice. Read with Section 49(1)(a) and (b) of the Employment Act, once the termination was found unfair the claimant was automatically entitled to gratuity up to the date of termination and notice. The court would only have declined compensation for unfair termination due to the claimant's contribution to the circumstances of termination.

p. 5

Legal principles established

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  • Stay of execution pending appeal requires an arguable appeal with a reasonable chance of success, plus preservation of the subject matter / avoidance of irreparable loss or the appeal being rendered nugatory
  • For a termination to be valid there must be both valid reason and fair procedure; if either is missing the termination is unfair under Section 45(1) and (2) of the Employment Act
  • Once a termination is found unfair, the employee is automatically entitled to contractual notice and gratuity up to the date of termination

Court orders

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  1. 1.The application dated 1st July 2013 is dismissed with costs
  2. 2.The applicant may apply for stay at the Court of Appeal if not satisfied with this ruling

Authorities

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Legislation

  • Employment ActSection 45(1) and (2)
  • Employment ActSection 49(1) as read with Section 50
  • Employment ActSection 44 (referred to in grounds of opposition)

Cases cited (6)

  • James Wangalwa & Another vs Agnes Naliaka Cheseto
    Bungoma HCC Misc. App. No. 42 of 2011
  • Tarbo Transporters Ltd vs Absalom Dova Lumbasi
    Bungoma Civil Appeal No. 31 of 2012
  • Margaret Wambui Magu v Rachel Njeri Nyawanga & Another
    Nairobi HCC 1509 of 2002
  • Attorney General of The Republic of Uganda vs EACJ African Law Society & Another
    EACJ Application No. 1 of 2013
  • Henry Wanyama Khaemba vs Standard Chartered Bank (K) Limited
    Nairobi CA No. 67 of 2008
  • Mukuna vs Abuoga
    Nairobi CA No. 95 of 1987
Jurisdiction invoked
Inherent jurisdiction to grant stay of execution pending appeal (intended appeal to the Court of Appeal against judgment of 5th June 2013)

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, "Anne Kirumba Riungu v Telkom Kenya Limited [2014] KEELRC 887 (KLR)", Case Analysis (2014). Not stated in the extract (application arising from Employment and Labour Relations Court cause, judgment of 5th June 2013). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2014/887/eng@2014-03-20

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