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ELRCPartially AllowedCause No 2231 of 2014· [2018] KEELRC 358 (KLR)

Peter Ezekiel Owuor v Delmonte Kenya Limited [2018] KEELRC 358 (KLR)

Employment and Labour Relations Court (originally filed in the High Court at Nairobi)
20 December 2018
MOMaureen Onyango
2,620 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 an employee his unpaid terminal dues with interest, but upheld his 2005 dismissal for falsified medical claims under pre-2007 employment law.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent (formerly Kenya Canners Limited) from December 1982, was terminated by letter dated 14th November 2005 while serving as foreman in the Culture Central Section. He alleged the termination followed a show cause letter accusing him of forging medical claim documents, that he was denied a hearing before a disciplinary panel, and that he was uncompensated for an on-duty motorcycle accident of 15th July 2005. He sought declarations of nullity, terminal dues to March 2016, Workmen's Compensation, and general damages. The Respondent admitted the termination but justified it under its Management Committee Procedures Manual, relying on an audit which revealed fictitious medical claims reimbursed to 11 employees, including the Claimant's claim of Kshs.16,920. The court framed two issues: whether the termination was unfair, and whether the reliefs were available. Holding that the suit, filed in 2006, was governed by the repealed Employment Act Cap 226 (the Employment Act, 2007 not applying retrospectively), the court found the Claimant had no automatic right to a panel hearing or to reasons for termination under the then-applicable law and the employer's Manual; dismissal for cause for falsified records was sufficient. Judgment was entered for the Claimant only in terms of the termination letter - days worked, pro-rata leave, three months' pay in lieu of notice, and pension contributions with interest - plus court-rate interest from filing suit because the dues were withheld. The Workmen's Compensation claim failed for want of evidence, and general damages were refused as pre-2007 law limited them to contractual entitlements. The Respondent was ordered to pay the Claimant's costs.

Key legal issues

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01

Whether the Claimant's termination was unfair

Holding

The termination was fair under the law applicable at the time (repealed Employment Act Cap 226) and the Respondent's Management Committee Procedures Manual; there was no automatic right to a disciplinary panel hearing for dismissal for cause involving falsified documents.

Reasoning

The suit predated the Employment Act, 2007, which cannot apply retrospectively. Under the repealed Employment Act Cap 226, an employee had no automatic right to a hearing or to be given reasons except in redundancy and notification to a labour officer. The applicable Manual clause permitted dismissal for cause where the company determined a serious offence such as making fraudulent records. An audit dated 26th October 2005 revealed fictitious claims, including one of Kshs.16,920 by the Claimant, providing sufficient reason for dismissal.

p. 3
02

Whether the Claimant is entitled to the reliefs sought

Holding

Judgment entered in terms of the letter of termination (days worked, pro-rata leave, three months' pay in lieu of notice, pension contribution and interest) with interest at court rates from filing suit; claims for Workmen's Compensation and general damages failed.

Reasoning

The Respondent admitted willingness to pay terminal dues itemised in the termination letter but the Claimant never collected them. Section 5(3) of the repealed Employment Act Cap 226 required payment of all moneys due on lawful summary dismissal. Compensation for injuries failed for want of evidence, and general damages were limited by contract terms under the pre-2007 remedies regime.

p. 4

Legal principles established

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  • The Employment Act, 2007 does not apply retrospectively to terminations that occurred before its commencement; the dispute is governed by the repealed Employment Act Cap 226.
  • Prior to the Employment Act, 2007, there was no statutory right to a hearing before dismissal unless incorporated by contract, staff manuals or policies.
  • General damages for wrongful dismissal are limited to the amount the employer would have been obliged to pay under the contract.
  • A court only has jurisdiction to award remedies available at the time of the wrongful dismissal or unfair termination.

Court orders

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  1. 1.Judgment entered for the claimant against the respondent in terms of the letter of termination
  2. 2.Interest on the terminal dues at court rates from the date of filing suit until payment in full
  3. 3.Respondent to pay claimant's costs of the suit

Authorities

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Legislation

  • Employment Act 2007Sections 41(1), 43(1), 45(1), 45(3)(b); Fifth Schedule paragraph 2(4)
  • Employment Act Cap 226 (repealed)Sections 5(3), 5(4)(b), 16A
  • Workmen's Compensation Act (Cap 236)Not specified
  • Labour Relations ActFifth Schedule paragraph 2(4)
  • Employment and Labour Relations Court Act, 2011Not specified
  • Trade Disputes Act (Cap 234, repealed)Not specified

Cases cited (7)

  • Kenya Ports Authority v Andrew Ochieng Odongo
    [2017] eKLR
  • Samuel Kamau Macharia & Another v. Kenya Commercial Bank Limited & 2 Others
    Civil Application No. 2 of 2011
  • Anthony Mkala Chitavi v Malindi Water & Sewerage Company Ltd
    [2013] eKLR
  • Mary Wakhabubi Wafula v British Airways PLC
    [2015] eKLR
  • Rift Valley Textiles Ltd v. Edward Onyango Oganda
    (Nakuru) Civil Appeal No. 27 of 1992 (unreported)
  • Cyrus Nyaga Kabute v. Kirinyaga County Council
    Civil Appeal No. 29 of 1985 (unreported)
  • Wanjohi v Mitchell Cotts Kenya Ltd
    (2002) 2 KLR 462
Jurisdiction invoked
Original employment dispute jurisdiction; suit transferred to the Employment and Labour Relations Court (statutory provision not expressly stated in judgment)

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, "Peter Ezekiel Owuor v Delmonte Kenya Limited [2018] KEELRC 358 (KLR)", Case Analysis (2018). Cause No 2231 of 2014. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/358/eng@2018-12-20

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