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ELRCPartially AllowedMemorandum of Claim dated 11th July, 2015· [2016] KEELRC 1754 (KLR)

Joseph Kaitano Ikobwa v Khetia Garment Limited [2016] KEELRC 1754 (KLR)

Employment and Labour Relations Court
28 January 2016
2,259 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 ruled a labourer's summary dismissal unfair, awarding him Kshs. 82,500 because his employer kept no written contract and gave him no hearing.

What this practically means

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Executive summary

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The claimant, employed as a general labourer at the respondent's Eldoret shop from 13th August, 2010, was summarily dismissed on 10th July, 2013 following a disputed shortfall of Kshs. 13,000.00 in a cash collection of Kshs. 395,000.00 made during a sales trip. He claimed notice pay, severance pay, leave dues, unpaid rest days and public holidays, underpayment of wages and twelve months' compensation, plus a certificate of service. The respondent denied employing the claimant, sought leave to join Pemage Security Services Ltd as third party, but did not pursue that application to conclusion. The court framed five issues: employment relationship, fairness of termination, entitlement to relief, certificate of service, and costs. Relying on Sections 8, 9 and 10(7) of the Employment Act, 2007, the court held that the employer's failure to produce a written contract placed the burden of proving or disproving the employment terms on it, and the uncontroverted membership card, identity card and application letter established employment. On fairness, the court applied Sections 45(2) and 41, adopting the principle that termination requires both substantive justification and procedural fairness, and found the respondent had observed neither. The claim was allowed in part: a declaration of wrongful, unfair and unlawful termination; an order to issue a certificate of service; one month's notice pay of Kshs. 7,500; two years' leave dues of Kshs. 15,000; and eight months' compensation of Kshs. 60,000, totalling Kshs. 82,500. The Commissioner for Labour was directed to compute overtime dues within ninety days, with mention set for 4th May, 2016. Costs were awarded to the claimant against the respondent.

Key legal issues

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01

Whether the claimant was an employee of the respondent

Holding

The claimant was an employee of the respondent; the respondent's mere denial and failure to produce a written contract shifted the burden of proof to it

Reasoning

The claimant produced a KUCFAW membership card indicating employment by the respondent as a General Labourer, his identity card, a job application letter dated 21st July, 2010 and a demand letter. None were controverted. Under Section 10(7) of the Employment Act the employer bears the burden of proving or disproving alleged terms where no written contract is produced. The respondent instead advanced mere denial, so the claimant's evidence prevailed.

p. 4
02

Whether the termination was wrongful, unfair and unlawful

Holding

The termination was wrongful, unfair and unlawful for want of valid reason and fair procedure

Reasoning

Section 45(2) of the Employment Act bars unfair termination and requires the employer to prove a valid and fair reason plus fair procedure. Section 41 requires the employer to explain reasons to the employee, allow a representative and hear explanations. The respondent observed none of these requirements, and the disputed Kshs.13,000.00 deduction was imposed without due process, rendering the summary dismissal substantively and procedurally unfair.

p. 5
03

Entitlement to a certificate of service

Holding

The claimant was entitled to a certificate of service as a mandatory statutory entitlement

Reasoning

Section 51 of the Employment Act makes issuance of a certificate of service by an employer on cessation of employment mandatory. The court described the question as a non-issue and ordered the respondent to issue the certificate.

p. 6

Legal principles established

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  • Where an employer fails to produce a written contract or written particulars of employment, the burden of proving or disproving an alleged term of employment lies on the employer
  • For a termination of employment to pass the fairness test there must be both substantive justification and procedural fairness
  • An employer is obliged to issue a certificate of service on cessation of employment

Court orders

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  1. 1.A declaration that the termination of the employment of the claimant was wrongful, unfair and unlawful
  2. 2.The respondent be and is hereby ordered to issue the claimant with a certificate of service
  3. 3.That the Commissioner for labour be and is hereby ordered to, with the involvement of the parties, compute overtime dues payable to the claimant on or before ninety (90) days of this judgment of court
  4. 4.One month's pay in lieu of notice at Ksh. 7,500.00
  5. 5.Leave dues for two (2) years at Kshs. 15,000.00
  6. 6.8 months compensation for unfair termination of employment being 7500 x 8 months = Kshs. 60,000.00
  7. 7.Total award of Kshs. 82,500.00
  8. 8.Mention on 4th May, 2016 to confirm computation of overtime dues and other directions of court
  9. 9.The costs of this claim shall be borne by the respondent

Authorities

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Legislation

  • Employment Act, 2007Section 8
  • Employment Act, 2007Section 9(2)
  • Employment Act, 2007Section 10(1)
  • Employment Act, 2007Section 10(7)
  • Employment Act, 2007Section 41
  • Employment Act, 2007Section 45(2) and (4)
  • Employment Act, 2007Section 51
  • Legal Notice No. 98 of 1st May, 2010wages order
  • Legal Notice No. 64 of 1st May, 2011wages order
  • Legal Notice No. 70 of 1st May, 2012wages order

Cases cited (3)

  • Edward Isedio Mukasia Vs Eldo Supermarket Ltd
    [2015] eKLR
  • Walter Ogal Anuro Vs Teachers Service Commission
    (2013) eKLR
  • Alphonce Machanga Mwachanya Vs Operation 680 Limited
    (2013) eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over disputes arising from employment 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, "Joseph Kaitano Ikobwa v Khetia Garment Limited [2016] KEELRC 1754 (KLR)", Case Analysis (2016). Memorandum of Claim dated 11th July, 2015. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2016/1754/eng@2016-01-28

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