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ELRCPartially AllowedCause No 261 of 2013· [2014] KEELRC 1128 (KLR)

Pius Kipruto Keter v Fanikiwa Limited [2014] KEELRC 1128 (KLR)

Industrial Court (Employment and Labour Relations Court)
11 July 2014
BOByram Ongaya
1,706 words in judgment
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The bottom line

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Kenya's Employment Court ruled that firing a 12-year employee by phone, without notice or hearing, was unfair and awarded Kshs.200,000.

What this practically means

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Executive summary

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The claimant, employed by the respondent from 24.04.2001 as a security officer rising to head of security at the respondent's farm, sued claiming salaries on suspension, reinstatement, annual leave for 13 years, compensation for suspension, overtime and public holiday pay, and underpayment per Legal Notice No. 71 of 2012. The respondent denied the claims and counter-claimed for Kshs.355,428 overpayment and Kshs.8,000 in lieu of notice, asserting the claimant deserted employment after police questioned him over stolen power saws. The court framed two issues: whether the termination was unfair and the parties' entitlement to remedies. Finding the respondent's account unpersuasive — the director who allegedly terminated the employment was not called, police never arrested the claimant, and no disciplinary process was initiated — the court held the claimant was terminated by telephone on 28.04.2013 without notice, hearing or genuine reason, contrary to sections 41 and 43 of the Employment Act, 2007, and applied the court's own opinion in Malachi Ochieng Pire v Rift Valley Agencies on the employer's integrity obligation. The court awarded twelve months' compensation (Kshs.96,000), pay in lieu of notice (Kshs.8,000) and service pay of Kshs.96,000 for 12 complete years without NSSF contributions, entering judgment for Kshs.200,000 with costs. Claims for underpayment, overtime, public holidays and annual leave failed, as did the counter-claim; reinstatement was refused as the relationship was irreparably strained and the prayer was not urged.

Key legal issues

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01

Whether the termination was unfair

Holding

Termination by telephone call without notice or hearing and without genuine reason; unfair in substance and procedure

Reasoning

The respondent failed to call the director who allegedly terminated the employment; no explanation why police did not arrest the claimant despite alleged implication in theft; and no disciplinary process was initiated if the claimant had deserted. The court preferred the claimant's account and found termination by telephone on 28.04.2013, contrary to sections 41 and 43 of the Employment Act.

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02

Remedies for unfair termination

Holding

Twelve months' compensation of Kshs.96,000, pay in lieu of notice of Kshs.8,000 and service pay of Kshs.96,000 for 12 years, totalling Kshs.200,000

Reasoning

Considering the claimant's long service of 12 complete years and non-contribution to the termination, twelve months' gross pay was awarded. Notice pay was due as termination was unfair. Under section 35(5) of the Employment Act, service pay for every year worked was due because no NSSF contributions or alternative pension arrangements were made.

p. 3

Legal principles established

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  • An employer cannot waive its authority to initiate disciplinary action; where it does, the employee retains the entitlement to fair reason and fair procedure
  • Late-raised allegations of poor performance or misconduct not raised at or before termination tilt the benefit of doubt in favour of the employee

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 Kshs.200,000.00 by 1.09.2014, failing which interest at court rates from the date of judgment till full payment
  3. 3.The respondent to pay costs of the suit

Authorities

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Legislation

  • Employment Act, 2007section 41
  • Employment Act, 2007section 43
  • Employment Act, 2007section 35(5)
  • Legal Notice No. 71 of 2012

Cases cited (1)

  • Malachi Ochieng Pire v Rift Valley Agencies
    Industrial Cause No. 22 of 2013 at Nakuru [2013] eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over employment disputes (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, "Pius Kipruto Keter v Fanikiwa Limited [2014] KEELRC 1128 (KLR)", Case Analysis (2014). Cause No 261 of 2013. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2014/1128/eng@2014-07-11

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