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ELRCPartially AllowedCause No. 1523 of 2012· [2016] KEELRC 1778 (KLR)

Joseph K. Thuo v Kenol Kobil Limited (Cause 1523 of 2012) (Civ) [2016] KEELRC 1778 (KLR)

Employment and Labour Relations Court
28 January 2016
1,845 words in judgment
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The bottom line

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Kenya's Employment Court ordered Kenol Kobil to pay a former finance executive over Kshs. 10 million after finding his dismissal for 'poor performance' was actually retaliation for suing the company.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent since 19 May 1983 in its finance department, sued for damages for unlawful termination following a letter dated 10 August 2012 citing poor performance. He contended the dismissal was actually triggered by his refusal to take early retirement during the company's proposed takeover by PUMA Energy and by his participation, with other employees, in Cause No. 1022 of 2012 filed to protect employees' rights. The Respondent maintained the termination was a contractual right, based on a review showing dismal performance and losses. The court framed four issues: the true reason for termination, its validity, procedural fairness, and remedies. It found the termination letter cited non-performance rather than restructuring; that the Respondent failed to prove poor performance given the Claimant's consistent awards and appraisals; and that the true motive was retaliation for filing Cause No. 1022 of 2012. No due process under section 41 of the Employment Act, 2007 was followed, making the termination unlawful and unjustified under section 45(1) and (2). The court awarded 12 months' salary as compensation (Kshs. 4,513,620), one month's salary in lieu of notice (Kshs. 376,135), and service pay of Kshs. 5,453,957.50 (½ month's salary for 29 years), totalling Kshs. 10,343,712.50, plus a Certificate of Service and costs. Constitutional declaratory and compensation prayers, general damages, reinstatement, service charge and interest were not granted in the final orders.

Key legal issues

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01

The real reason for the Claimant's termination

Holding

The termination was pegged on the Claimant's filing of Cause No. 1022 of 2012 against the Respondent, not on genuine poor performance or restructuring

Reasoning

The termination letter dated 10.8.2012 cited poor performance, not restructuring. The Claimant had a consistent record of good performance, awards and promotions. He had been asked to take early retirement, refused, and had sued the Respondent. The Respondent produced no proof of the alleged poor performance. The court inferred the dismissal was retaliatory for asserting employees' rights.

p. 4
02

Validity of the reason for termination

Holding

The reason given (poor performance) was not valid and was not proved

Reasoning

Under section 43 of the Employment Act, 2007 an employer must prove the reason for termination. The Respondent alleged a review showing dismal departmental performance and losses, but the Claimant's history of awards and excellent appraisals contradicted this, and the Respondent failed to demonstrate the alleged poor performance.

p. 4
03

Procedural fairness

Holding

No due process under section 41 of the Employment Act was followed

Reasoning

Section 41 requires an employer, before terminating on grounds of misconduct, poor performance or incapacity, to explain the reasons to the employee and hear representations, with a chosen companion present. The Respondent gave the Claimant none of these, so the termination was procedurally unfair and hence unjustified under section 45(1) and (2).

p. 4

Legal principles established

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  • An employer terminating on grounds of poor performance must prove the poor performance and follow the procedure in section 41 of the Employment Act, including explanation and hearing
  • A termination communicated as being for poor performance cannot be justified by a different, unproven reason, and the burden lies on the employer under sections 43 and 45 of the Employment Act

Court orders

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  1. 1.12 months' salary as compensation for unlawful termination: Kshs. 4,513,620/= (12 x 376,135)
  2. 2.One month's salary in lieu of notice: Kshs. 376,135/=
  3. 3.Service pay at ½ month salary for each year worked for 29 years: Kshs. 5,453,957.50/=
  4. 4.Total award of Kshs. 10,343,712.50/=
  5. 5.Claimant to be issued with a Certificate of Service
  6. 6.Respondent to pay costs of the suit

Authorities

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Legislation

  • Constitution of Kenya, 2010Article 27(5)
  • Constitution of Kenya, 2010Article 47(1)
  • Constitution of Kenya, 2010Article 41(1)
  • Constitution of Kenya, 2010Article 26(1)
  • Constitution of Kenya, 2010Article 23(3)
  • Employment Act, 2007Section 41(1) and (2)
  • Employment Act, 2007Section 42(1)
  • Employment Act, 2007Section 43
  • Employment Act, 2007Section 45(1) and (2)
  • Employment Act, 2007Section 44(3) and (4)
  • Employment Act, 2007Section 49
  • Industrial Court ActSection 12(3)(vi)
Jurisdiction invoked
Jurisdiction under the Industrial Court Act (including section 12(3)(vi)) over employment disputes; reliefs anchored on Articles 23(3), 41(1), 47(1) and 27(5) of the Constitution and sections 41, 43, 45 and 49 of the Employment Act, 2007

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (1)

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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, "Joseph K. Thuo v Kenol Kobil Limited (Cause 1523 of 2012)  (Civ) [2016] KEELRC 1778 (KLR)", Case Analysis (2016). Cause No. 1523 of 2012. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2016/1778/eng@2016-01-28

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