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ELRCPartially AllowedCause No 301 of 2013· [2014] KEELRC 1137 (KLR)

Joseph Kimunya v Salt Manufacturers (K) Ltd [2014] KEELRC 1137 (KLR)

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

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A Kenyan employer who fires a worker without notice, a hearing, or a proven reason must pay maximum compensation of twelve months' salary.

What this practically means

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Executive summary

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The claimant, orally employed as a driver by the respondent from October 2005, was terminated on 20.02.2012. He claimed a declaration that the termination was unfair and unlawful, notice pay of Kshs.10,000.00, maximum compensation of 12 months' salary (Kshs.120,000.00) and service pay of Kshs.60,000.00. The respondent sought dismissal of the suit with costs, contending the claimant was terminated on suspicion of high fuel consumption and unauthorised transport services. At hearing, the claimant testified he was abruptly informed of his termination, humiliated, assaulted by the General Manager and police, and forced to sign for Kshs.19,377.00 in terminal dues; he denied stealing fuel and was never charged. The respondent's own witnesses (RW1 and RW2) disowned the theft allegation, confirmed the claimant was injured, and confirmed payment of notice pay within terminal dues. The court framed the sole issue as whether the claimant was entitled to the remedies prayed for. It held the termination breached section 41 of the Employment Act, 2007 (no notice or hearing), that no genuine reason for termination was established, and that the assault and humiliation were serious aggravating circumstances warranting the maximum compensation of 12 months' gross salary. The declaration of unfair termination was granted. Notice pay was refused as already paid, and service pay was refused because the claimant was an NSSF member, section 35(5) barring such payment. Judgment was entered for the claimant for the declaration and Kshs.120,000.00 payable by 1.8.2014, failing which interest at court rates, plus costs of the suit.

Key legal issues

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01

Whether the termination was unfair and unlawful

Holding

Termination was unfair and unlawful: no notice or hearing was given and no genuine reason was established

Reasoning

Section 41 of the Employment Act, 2007 requires notice and a hearing before termination. The respondent gave neither. The alleged reason that the claimant stole fuel was not established and no genuine reason was advanced at the time of termination. The manner of termination, including assault and humiliation of the claimant by the General Manager, was a serious aggravating circumstance justifying maximum compensation of 12 months' gross salary.

p. 2
02

Whether the claimant was entitled to notice pay

Holding

Not entitled, as notice pay of Kshs.10,000.00 had already been paid

Reasoning

RW2, the respondent's accountant, gave evidence that the terminal dues paid to the claimant of Kshs.19,377.00 included Kshs.10,000.00 as pay in lieu of notice. The court accepted this evidence and found the claimant not entitled to a further award of notice pay as prayed for in the memorandum of claim.

p. 2
03

Whether the claimant was entitled to service pay

Holding

Not entitled because he was a member of the National Social Security Fund

Reasoning

The claimant was a registered member of the National Social Security Fund. Section 35(5) of the Employment Act, 2007 bars service pay in such circumstances, as submitted by the respondent. The claim for service pay at 1/12 for 6 years of service amounting to Kshs.60,000.00 therefore failed.

p. 2

Legal principles established

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  • An employer must give notice and a hearing before termination as provided for in section 41 of the Employment Act, 2007
  • An employer bears responsibility for establishing a genuine and valid reason for termination
  • Membership of the National Social Security Fund bars a claim for service pay under section 35(5) of the Employment Act, 2007

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.120,000.00 by 1.8.2014, 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 35(5)
Jurisdiction invoked
Employment and labour relations dispute 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, "Joseph Kimunya v Salt Manufacturers (K) Ltd [2014] KEELRC 1137 (KLR)", Case Analysis (2014). Cause No 301 of 2013. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2014/1137/eng@2014-07-11

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