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ELRCPartially AllowedCause No 1556 of 2014· [2015] KEELRC 977 (KLR)

George Ndiritu Mueithi v Premier Academy Charitable Trust (being sued through Trustees Mukesh Manubhai, Vijay Parsooram Patel & Prafulchandra Chandubhai Patel [2015] KEELRC 977 (KLR)

Industrial Court of Kenya (Employment and Labour Relations Court)
26 May 2015
NMNzioki wa Makau
3,447 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~14 min to read original · ~4 min brief

The bottom line

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A Kenyan court ruled that firing an employee without giving a reason is unlawful, even if the employer pays notice, and awarded maximum compensation.

What this practically means

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Executive summary

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The Claimant, a teacher and Deputy Head employed by the Respondent (ultimately on a three-year contract from 2012 expiring July 2015, gross salary Kshs. 135,200/-), was terminated on 22nd April 2014 without reasons, though paid three months' salary in lieu of notice (Kshs. 306,291/-). He sued seeking 12 months' salary compensation, the balance of the contract, pension contributions for the remainder of the term, costs and interest. The Respondent defended the suit on the basis of the contractual notice clause and argued that Sections 43 and 45 of the Employment Act were unconstitutional for contravening Article 27(1), relying on pre-2007 East African common law authorities limiting damages to the notice period. The court first held it had jurisdiction, following USIU v Attorney General, to determine the constitutionality of the Employment Act's provisions, and rejected the constitutional challenge, holding that it is not unconstitutional to require the owner of capital to ascribe a reason for termination. On the merits, the court found the termination unlawful because the Respondent, though entitled to terminate contractually, failed to ascribe a reason. The pre-2007 authorities relied on by the Respondent were held outdated and no longer good law on compensation. Balancing remedies under Section 49 of the Employment Act, the court declined anticipatory salaries for the balance of the contract but awarded maximum compensation of 12 months' salary (Kshs. 1,622,400/-), interest from filing, a Certificate of Service under Section 51, and costs of the suit. The pension having been paid, that head of claim was overtaken by events.

Key legal issues

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01

Constitutionality of Sections 43 and 45 of the Employment Act

Holding

Sections 43 and 45 are constitutional; the burden on the employer to prove reasons for termination does not violate Article 27(1)

Reasoning

The Respondent argued the provisions violated equality under Article 27(1). The court held employer and employee have different obligations and each can seek refuge in the Constitution. Requiring the owner of capital to ascribe a reason for termination is not unconstitutional; otherwise every section of law lacking a corresponding provision for the opposite side would be challengeable. The purpose of a reason is certainty for the employee.

p. 4
02

Whether the termination was unlawful

Holding

The termination was unlawful because no reason was ascribed despite compliance with the contractual notice clause

Reasoning

The Respondent was entitled to terminate in line with the contract, having given three months' notice pay. However, the law (Sections 43 and 45 of the Employment Act) required the employer to ascribe a reason. No reasons were given, and the Respondent's HR Manager confirmed this. The invocation of Article 27(1) as a shield failed, and the termination was unlawful.

p. 4
03

Appropriate compensation for unlawful termination

Holding

Maximum compensation of 12 months' gross salary awarded under Section 49 of the Employment Act

Reasoning

Payment of the balance of the contract is not automatic; proportionality principles apply. Considering that the Claimant was dismissed callously, the position was refilled months later, he was not redeployed, and he had difficulty securing comparable employment, the maximum 12 months' salary was a fair and reasonable remedy under Section 49.

p. 6

Legal principles established

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  • The Industrial Court has jurisdiction to determine the constitutionality of sections of the Employment Act in employment disputes before it
  • Requiring the employer to ascribe a reason for termination under Sections 43 and 45 of the Employment Act is not unconstitutional notwithstanding Article 27(1)
  • A termination in accordance with contract terms is still unlawful if the employer fails to ascribe a reason as required by law
  • Pre-Employment Act 2007 common law authorities limiting damages to the period of notice are no longer good law on compensation

Court orders

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  1. 1.Judgment for the Claimant against the Respondent for Kshs 1,622,400/- as compensation
  2. 2.Interest on the compensation at Court rates from date of filing till payment in full
  3. 3.Certificate of Service
  4. 4.Costs of the suit to the Claimant

Authorities

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Legislation

  • Employment ActSection 43
  • Employment ActSection 45(1) and (2)
  • Employment ActSection 49(1)-(4)
  • Employment ActSection 51
  • Industrial Court ActSection 12
  • Constitution of KenyaArticle 27(1)
  • Constitution of KenyaArticle 41
  • Constitution of KenyaArticle 19
  • Constitution of KenyaArticle 165(6)
  • Labour Relations Act2007

Cases cited (10)

  • United States International University (USIU) v Attorney General
    [2012] eKLR
  • Bernard Dodo Mbaja v Air Traffic Limited
    [2014] eKLR
  • Samson Kimani Gachara v Auto Springs Manufacturers Ltd
    [2015] eKLR
  • Ombanya v Gailey & Roberts Limited
    [1974] EA 522
  • Ogoye v Kenya National Trading Corporation
    [1995-98] 2 EA 264
  • Githinji v Mumias Sugar Co. Limited
    [1995-98] 1 EA 81
  • Kyobe v East Africa Airways
    [1972] EA 403
  • Mukiite v Barclays Bank of Kenya
    [1999] LLR 1138
  • Rift Valley Textiles Limited v Oganda
    [1009-94] EA 526 (as printed)
  • D. K. Njagi Marete v Teacher Service Commission
    [2013] eKLR
Jurisdiction invoked
Section 12 of the Industrial Court Act, 2011; Article 41 of the Constitution (jurisdiction to interpret the Constitution and enforce Bill of Rights in employment matters)

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (2)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "George Ndiritu Mueithi v Premier Academy Charitable Trust (being sued through Trustees Mukesh Manubhai, Vijay Parsooram Patel & Prafulchandra Chandubhai Patel [2015] KEELRC 977 (KLR)", Case Analysis (2015). Cause No 1556 of 2014. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2015/977/eng@2015-05-26

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