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ELRCPartially AllowedNot stated in judgment· [2014] KEELRC 1246 (KLR)

William Nyamawi Gambo v Krystalline Salt Ltd [2014] KEELRC 1246 (KLR)

Employment and Labour Relations Court
11 September 2014
RSRadido Stephen
1,970 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 must prove its reasons for firing an employee are valid and fair, or the dismissal becomes substantively unfair even if the process was followed.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent from November 1989 and later on a two-year fixed term contract as Storekeeper expiring on 30 June 2012, was summarily dismissed by letter dated 24 August 2012 on the ground of gross misconduct arising from an alleged loss of 921 tonnes of salt. He sued for terminal dues and damages for wrongful termination of Kshs 764,878/-. The court framed one central issue: whether the dismissal was unfair and, if so, the appropriate relief. On procedure, the court applied section 41 of the Employment Act, 2007 and held that, despite the Claimant's denial of receiving the show cause letter, his own contradictory evidence showed he was asked to explain the shortage and did so in writing; the dismissal was therefore procedurally fair. On substance, sections 43 and 45 placed the burden on the employer to prove valid and fair reasons. The Respondent could not establish when the salt was lost despite daily reconciliation and weighbridge weighing, and the Claimant's uncontroverted explanation that the salt dissolved in rainwater in leaking stores was accepted. The dismissal was held substantively unfair. The court assumed the Claimant continued on the terms of the expired contract. Relief awarded: service pay of Kshs 51,410/- (no evidence of NSSF contributions), unpaid July/August 2012 wages of Kshs 44,556/- (conceded), one month's pay in lieu of notice of Kshs 22,278/-, and 5 months' gross wages compensation of Kshs 111,390/-, totalling Kshs 229,634/-. The prayer for accrued leave was dismissed as the Claimant confirmed he had taken all leave days. The Claimant was awarded costs of the Cause. Judgment delivered in Mombasa on 11 September 2014 by Radido Stephen, Judge.

Key legal issues

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01

Procedural fairness of the dismissal

Holding

The dismissal was procedurally fair; the Claimant was asked to explain the shortage and did so in writing

Reasoning

Section 41 of the Employment Act applies to dismissals for misconduct. The Claimant denied receiving the show cause letter but in cross examination admitted he was asked to explain the shortage and wrote a letter doing so. Given his contradictory evidence, the court found he was informed of contemplated disciplinary action and given an opportunity to explain, hence the dismissal was procedurally fair.

p. 3
02

Substantive fairness of the dismissal

Holding

The dismissal was substantively unfair; the employer failed to prove valid and fair reasons

Reasoning

The Respondent could not establish over what period the 921 tonnes of salt was lost despite daily stock reconciliation and weighbridge weighing of all incoming and outgoing salt. The Claimant's uncontroverted explanation that the salt was stored in the open, leaked on, and dissolved in rain was accepted. The Respondent thus failed to discharge its burden under sections 43 and 45.

p. 3
03

Appropriate relief for substantively unfair dismissal

Holding

Service pay, unpaid wages, one month pay in lieu of notice, and 5 months' gross wages as compensation totalling Kshs 229,634/-

Reasoning

Service pay was awarded under section 35(5) and (6) as the Respondent produced no concrete evidence of NSSF contributions. Unpaid wages were conceded. Notice pay was awarded under sections 35(1), 36 and clause 19 of the contract. Compensation of 5 months' gross wages was assessed considering the expired contract and unclarified subsequent terms.

p. 4

Legal principles established

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  • The duty to show that procedural fairness was complied with rests on the employer
  • Sections 43 and 45 of the Employment Act place the burden on an employer to prove valid and fair reasons for dismissal
  • Compensation under section 49 is discretionary and subject to the enumerated factors

Court orders

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  1. 1.Respondent to pay Claimant service pay of Kshs 51,410/-
  2. 2.Respondent to pay Claimant unpaid wages for July/August 2012 of Kshs 44,556/-
  3. 3.Respondent to pay Claimant 1 month wages in lieu of notice of Kshs 22,278/-
  4. 4.Respondent to pay Claimant 5 months gross wages compensation of Kshs 111,390/- (total Kshs 229,634/-)
  5. 5.Claimant to have costs of the Cause

Authorities

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Legislation

  • Employment Act, 2007Section 41
  • Employment Act, 2007Sections 43 and 45
  • Employment Act, 2007Section 35(1), (5) and (6)
  • Employment Act, 2007Section 36
  • Employment Act, 2007Section 49(4)
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over a statement of claim for unfair/wrongful termination 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, "William Nyamawi Gambo v Krystalline Salt Ltd [2014] KEELRC 1246 (KLR)", Case Analysis (2014). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2014/1246/eng@2014-09-11

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