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ELRCPartially AllowedCause No. 622 of 2014· [2015] KEELRC 625 (KLR)

Joseph Mugo Kabaria & 10 others v Punchlines Limited [2015] KEELRC 625 (KLR)

Employment and Labour Relations Court of Kenya at Nairobi
30 July 2015
HWHellen S. Wasilwa
1,494 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 couldn't produce staff employment contracts had to pay notice pay, six months' terminal benefits and costs, though unfair dismissal was not found.

What this practically means

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Executive summary

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Eleven machine operators employed by Punchlines Limited at various dates between 2010 and 2013 claimed they were denied copies of their signed contracts, discouraged from forming a union, and ultimately locked out and dismissed on 26/3/2014 without notice, warning or disciplinary hearing, after protesting the withdrawal of a Saturday payment allowance. The Respondent denied the dismissals, asserting the Claimants protested the revocation of a Saturday transport arrangement, walked out, and refused to return to work despite requests, and that four of the fifteen who protested resumed work. The Respondent further contended the suit was filed in haste to curtail a pending disciplinary process. The court framed three issues: whether the Claimants were terminated, whether due process was followed, and whether remedies were due. Relying on Section 10(7) of the Employment Act, the court held that since the Respondents could not produce the contracts they were custodians of, the burden of proving contractual terms rested on them, and it was assumed no contracts were issued. The court found the Respondents had failed to issue appointment letters and to follow Employment Act procedures, and made no labour office report despite alleging abscondment. However, doubting whether there was a dismissal or abscondment, the court declined to find an unfair dismissal, faulting the Claimants for rushing to court 18 days later without attempting settlement under Section 15(2) of the Industrial Court Act, and characterised the separation as a normal termination. It awarded each Claimant a certificate of service, one month's salary in lieu of notice, a copy of the contract letter, and six months' salary as terminal benefits, with costs to the Claimants.

Key legal issues

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01

Whether the Claimants were terminated by the Respondents

Holding

The court found no proper dismissal; the Respondents failed to produce contracts, and the Claimants' separation was treated as a normal termination.

Reasoning

The Respondents, as custodians of the signed contracts, could not produce copies, so the court assumed no contracts were issued. The conflicting correspondence (the Claimants' letter of 4/4/2014 asserting dismissal and the Respondents' reply of 10/4/2014 denying it) left doubt whether there was dismissal or abscondment. The court resolved the doubt by treating the separation as normal termination, noting the Respondents' omissions in failing to issue appointment letters and follow Employment Act procedures.

p. 3
02

Whether due process was followed

Holding

The court found the Respondents failed to follow Employment Act procedures and made no report to the labour office despite alleging abscondment.

Reasoning

The Respondents omitted to issue appointment letters and did not follow the procedures laid down in the Employment Act. Although they alleged the Claimants refused to return to work, no report was made to the labour office. However, the court also faulted the Claimants for rushing to court 18 days after the alleged dismissal without attempting settlement as envisaged under Section 15(2) of the Industrial Court Act 2011.

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03

Whether the Claimants are entitled to remedies

Holding

The court awarded certificates of service, one month's salary in lieu of notice, copies of contracts, and six months' salary as terminal benefits to each Claimant.

Reasoning

Having characterised the separation as a normal termination rather than an unfair dismissal, the court granted remedies consistent with that finding: certificates of service, notice pay, contract copies and six months' salary as terminal benefits, plus costs of the suit against the Respondent.

p. 3

Legal principles established

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  • Where an employer fails to produce the written contract of employment in legal proceedings, the burden of proving or disproving an alleged term of employment rests on the employer.
  • The court may refuse to determine a dispute where no attempt at settlement has been made.

Court orders

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  1. 1.Each Claimant to be issued with a Certificate of Service
  2. 2.Each Claimant to be paid one month's salary in lieu of notice as per their last pay certificate
  3. 3.Each Claimant to be issued with a copy of their letter of contract
  4. 4.Each Claimant to be paid an equivalent of 6 months salary as terminal benefits
  5. 5.Respondent to pay costs of the suit

Authorities

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Legislation

  • Employment ActSection 10(7)
  • Industrial Court ActSection 15(2)
Jurisdiction invoked
Industrial Court Act 2011 (disputes referred to the Industrial Court as then constituted)

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 Mugo Kabaria & 10 others v Punchlines Limited [2015] KEELRC 625 (KLR)", Case Analysis (2015). Cause No. 622 of 2014. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2015/625/eng@2015-07-30

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