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ELRCPartially AllowedCause No. 184 of 2014· [2016] KEELRC 839 (KLR)

George Nyandiko v China Jiangxi International Kenya Limited [2016] KEELRC 839 (KLR)

Employment & Labour Relations Court
26 May 2016
1,455 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan court awarded a redundant employee Shs.81,750, but he lost bigger claims because he never properly disputed his employer's evidence.

What this practically means

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Executive summary

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The Claimant, George Nyandiko, sued China Jiangxi International Kenya Limited for alleged unilateral termination of his employment on 1st April 2014, seeking severance pay, unpaid housing allowance, leave pay, leave allowance, one year's salary as compensation for unlawful termination, one month's notice pay, and retained salary, plus costs and interest. The Respondent admitted employment at a consolidated salary of Shs.30,000 and averred that the Claimant's contract, tied to a Lake Victoria South Water Services Board project, expired on 30th April 2014, amounting to a redundancy, and that it had offered one month's salary in lieu of notice on ex gratia basis. The court framed three issues: unfair termination, redundancy, and entitlement to reliefs. It found no unfair termination as the Claimant did not contest the reason in the termination notice, and held the Respondent's admission of redundancy conclusive. It awarded Shs.30,000 notice pay as offered, severance pay of Shs.15,000 (15 days per completed year under section 40(1)(g), one completed year only), and Shs.36,750 for untaken leave at 1.75 days per month, the Respondent having failed to produce leave records as required by sections 10(7) and 74. House allowance and leave allowance claims failed, as did the one-year compensation claim. The Claimant was awarded a total of Shs.81,750 with only 50% of costs, since the Respondent had offered severance and notice pay.

Key legal issues

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01

Whether the Claimant was unfairly terminated

Holding

No unfair termination was found because the Claimant did not contest the reason given in the termination notice.

Reasoning

The Claimant pleaded unilateral termination on 1st April 2014, but the termination letter stated the termination resulted from completion of the project he was working on. The Respondent pleaded redundancy. Since the Claimant did not contest the reason given in the termination notice, the court found no evidence of unfair termination.

p. 2
02

Whether the Claimant was declared redundant

Holding

The Respondent admitted the termination was a redundancy, so no further inquiry was needed.

Reasoning

Redundancy is defined under section 2 of the Employment Act, and section 40 provides the procedure and terminal dues payable. The Respondent pleaded that the contract for which the Claimant was engaged expired on 30th April 2014, ending contracts for all employees, and admitted the termination was a redundancy. The court held this admission conclusive on the issue.

p. 3
03

Whether the Claimant is entitled to house allowance

Holding

Not entitled, as house allowance was included in his consolidated monthly salary per the letter of appointment.

Reasoning

The letter of appointment stated the salary was Shs.30,000 inclusive of house allowances, taxes and benefits. The Claimant denied the letter's authenticity only in written submissions, without filing a reply to defence. The court held submissions cannot substitute evidence, found the letter authentic, and rejected the house allowance claim.

p. 3
04

Entitlement to severance pay

Holding

Severance pay awarded at 15 days' salary for one completed year of service, being Shs.15,000.

Reasoning

The Claimant's proposed calculation of 125.25 x 8 x 30 x 2 was unintelligible to the court. Under section 40(1)(g), severance pay is 15 days' salary per completed year. Having worked from 1st August 2012 to 30th April 2014, the Claimant completed only one full year, justifying the award of Shs.15,000.

p. 3
05

Entitlement to leave earned but not taken

Holding

Awarded 36.75 days' leave for the period worked, valued at Shs.36,750, because the employer failed to produce leave records.

Reasoning

Under sections 10(7) and 74 of the Employment Act, the employer must keep employment records, including annual leave entitlement and days taken, and produce them in proceedings; failure shifts the burden to the employer. The Respondent produced no such records, so the court awarded leave at 1.75 days per month for the 21 months worked.

p. 3
06

One month's salary in lieu of notice

Holding

Awarded as offered by the Respondent on ex gratia basis, being Shs.30,000.

Reasoning

The court found the Claimant was given one month's notice by letter dated 1st April 2014 notifying termination on 30th April 2014. Since the Respondent had offered one month's salary in lieu of notice on ex gratia basis, the court awarded the Claimant the same as offered.

p. 3

Legal principles established

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  • Written submissions cannot be used to substitute evidence; they can only state legal positions.
  • It is the employer's responsibility under sections 10(7) and 74 of the Employment Act to keep and produce employment records; failing which the burden falls on the employer to prove facts that should have been in such records.
  • Severance pay is calculated at 15 days' salary per completed year of service under section 40(1)(g) of the Employment Act.
  • Where an employer admits that termination was a redundancy, the court need not inquire further into the issue.

Court orders

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  1. 1.One month's salary in lieu of notice offered by the Respondent awarded at Shs.30,000
  2. 2.Severance pay at 15 days' salary for one completed year of service awarded at Shs.15,000
  3. 3.Leave earned but not taken awarded at Shs.36,750
  4. 4.Total award of Shs.81,750 to the Claimant
  5. 5.Claimant awarded only 50% of costs

Authorities

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Legislation

  • Employment Actsection 2 (definition of redundancy)
  • Employment Actsection 35(b)
  • Employment Actsection 40 and section 40(1)(g)
  • Employment Actsection 10(7)
  • Employment Actsection 74 and section 74(1)(f)

Cases cited (4)

  • FRANCIS MAINA v LEE CONSTRUCTION
    [2014] eKLR
  • LTUMASIA LESHORONO v JAHAZI MARINE LIMITED
    [2013] eKLR
  • JOHN MWANGI KURIA & 165 OTHERS v ATTORNEY GENERAL & ANOTHER
    [2014] eKLR
  • MARY KATSAO NGOWA & 36 OTHERS v KRYSTALLINE LIMITED
    [2015] eKLR
Jurisdiction invoked
Employment and labour relations jurisdiction of the Employment & Labour Relations Court (Cause filed under the Employment Act)

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 Nyandiko v China Jiangxi International Kenya Limited [2016] KEELRC 839 (KLR)", Case Analysis (2016). Cause No. 184 of 2014. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2016/839/eng@2016-05-26

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