Rose Achieng Mihudhi v Jos Hansen & Soehne (EA) Limited [2015] KEELRC 445 (KLR)
The bottom line
#A Kenyan court ruled an employer unfairly terminated an employee who refused a new contract with a sister company, awarding 12 months' salary.
What this practically means
#Executive summary
#Key legal issues
#Inducement to leave previous employment
No actionable inducement by the Respondent; the inducement alleged was by a third party and the Claimant willingly signed the contract
The court found the Claimant signed a valid contract of employment dated 23rd January 2012 without alleging fraud, forgery or misrepresentation. The alleged inducement came from a third party rather than the Respondent's representative. Having signed knowingly and opted for better pay, there was no interference with her freedom to contract, so no damages for inducement were due.
Unfair termination
The termination was unfair - without notice, without reason and contrary to section 45 of the Employment Act
Probation ended by operation of section 42 of the Employment Act since it was not extended by mutual consent, confirming the Claimant as an employee. The contract contemplated deployment to Tanzania. Issuing a Certificate of Discharge on a confirmed contract and demanding a new contract from a sister entity without consent was an unfair labour practice contrary to Article 41 of the Constitution. Termination for refusing the new contract was therefore unjustified.
Discrimination
No discrimination proved; the Claimant was under a specific contract with no evidence of different treatment on a protected ground
Applying the test in Collins Osoro v AAA Growers Limited, the court found no clear outline of differential treatment contrary to set policy or arising from legitimate expectation of promotion or allowances. The claim was speculative, lacking evidence of the different circumstances needed to establish discrimination.
Respondent's counter-claim for loan repayment
Counter-claim dismissed; the loan was advanced by the Tanzanian sister company, not the Respondent, which was not entitled to recover it
The cheque, application and payment vouchers were all issued by Jos Hansen & Soehne (T) Ltd, a separate legal entity that was not joined as a party. Without express authority to receive the money for the sister company, the Respondent had no legal basis to claim repayment, and the counter-claim failed.
Remedies
Compensation of 12 months' gross salary awarded for unfair termination; other heads refused for want of proof
The Claimant served one year, was terminated without justifiable cause or notice and was frustrated by the issuance of a new contract she refused to sign. Circumstances no employee should be subjected to warranted the maximum-equivalent 12 months' compensation on her Kshs.80,000 salary. Damages for discrimination, inducement and poor work environment, relocation expenses, notice and leave were refused for lack of proof or payment.
Legal principles established
#- Courts respect parties' freedom to contract unless there is illegality, fraud, misrepresentation or unfair labour practice
- By operation of section 42 of the Employment Act, where probation is not extended by mutual consent the employee becomes confirmed
- Unilaterally varying a mutually agreed employment contract is an unfair labour practice contrary to Article 41 of the Constitution
- A counter-claim cannot be sustained against an employee for monies advanced by a separate entity that has not been enjoined as a party
- Discrimination requires evidence of different treatment from others similarly situated on a specified or unspecified ground
Court orders
#- 1.A declaration that the Claimant was unfairly terminated from her employment by the respondent
- 2.Compensation of Kshs.960,000.00 awarded to the Claimant (12 months' salary at Kshs.80,000.00)
- 3.The Respondent's counter-claim is dismissed
- 4.Each party shall bear their own costs
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction over employment disputes (Employment Act; unfair termination claim under sections 43, 45 and 49 of the Employment Act)
Key timeline
#Practical implications
#Frequently asked questions
#Later judgments citing this (3)
#Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.
- Kimathi v Ericsson Kenya Limited (Civil Appeal 601 of 2019) [2023] KECA 106 (KLR)[2023] KECA 106 (KLR)3 Feb 2023
- John Thomas Ngugi Mbau v County Public Service Board of Kiambu [2019] KEELRC 273 (KLR)[2019] KEELRC 273 (KLR)26 Nov 2019
- Narry Philemons Onaya-Odeck v Technical University of Kenya [Formerly, the Kenya Polytechnic University College) [2017] KEELRC 435[2017] KEELRC 435 (KLR)26 Sept 2017
Cite this brief
#Cite this brief
Caselaw, "Rose Achieng Mihudhi v Jos Hansen & Soehne (EA) Limited [2015] KEELRC 445 (KLR)", Case Analysis (2015). Cause No. 130 of 2013. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2015/445/eng@2015-08-20
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.