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ELRCPartially AllowedELRC Cause (Nairobi), filed 22nd June 2012· [2018] KEELRC 427 (KLR)

Joseph Wambua Kitheka v Endmor Steel Millers Limited [2018] KEELRC 427 (KLR)

Employment and Labour Relations Court
30 November 2018
2,779 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 that a 'casual' worker with over a month of continuous service is legally a monthly employee, and firing him without a fair hearing was unfair.

What this practically means

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Executive summary

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Joseph Wambua Kitheka sued Endmor Steel Millers Limited claiming that his termination on 22nd August 2011, on allegations that he agitated workers to boycott work, was unfair, unlawful and untimely, and sought Kshs.499,400 in salary arrears, loss of future earnings, public holiday pay, service pay and pay in lieu of notice. The respondent admitted the employment but contended the claimant was a casual employee, that it followed proper procedure, and that all dues save Kshs.5,200 had been paid; it also relied on the NSSF exemption to resist service pay. The court framed three issues: the claimant's employment status, the fairness of the termination, and entitlement to dues. Holding that the claimant had worked continuously from February 2010, the court found his casual contract converted to monthly terms under section 37(1) of the Employment Act after one month, and that 'permanent employment' is a misnomer. On fairness, the respondent gave no notice to show cause, produced no disciplinary proceedings, and failed to prove a valid reason and fair procedure as required by sections 41, 43 and 45. The termination was declared unfair. The court awarded Kshs.135,300 comprising pay in lieu of notice (Kshs.16,500), pay in lieu of annual leave (Kshs.15,400), paid rest days (Kshs.44,000), paid public holidays (Kshs.8,800), two days' unpaid salary (Kshs.1,100) and three months' salary as compensation (Kshs.49,500). Severance pay was rejected as the claimant was not declared redundant, and no award was made for loss of future earnings or underpayment. The respondent was ordered to pay the claimant's costs, with interest on the decretal sum from the date of judgment.

Key legal issues

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01

Whether the claimant was a casual or permanent employee

Holding

The claimant's casual engagement converted to a monthly term contract after one month of continuous service; the issue of permanent employment is a misnomer.

Reasoning

The claimant was engaged as a casual paid weekly but worked continuously from 19th February 2010 to 20th August 2011. Section 37(1) deems the contract to be monthly where a casual works the equivalent of not less than one month or performs work not completable within three months. The issuance of a letter of termination itself showed the respondent acknowledged he was not a casual, since a casual's contract terminates at the end of the day.

p. 3
02

Whether the termination was unfair

Holding

The termination was unfair within the meaning of sections 45(1) and (2) of the Employment Act.

Reasoning

Having been converted to a monthly contract employee with over 13 months' service, the termination had to comply with sections 41 and 43. The respondent gave no notice to show cause and produced no disciplinary proceedings as proof; the claimant was not subjected to a fair hearing, and the reason in the termination letter was denied by the claimant, leaving the employer unable to prove a valid reason and fair procedure.

p. 3
03

Entitlement to rest day and public holiday pay

Holding

As a converted monthly contract employee, the claimant was entitled to paid weekly rest days and public holidays, and double pay for any such days actually worked.

Reasoning

Under section 37(2) and (3), the converted employee was entitled to one paid rest day after six continuous working days and paid public holidays. The court presumed the claimant did not work on rest days or public holidays, awarding only the statutory paid rest days and public holidays (80 weeks and 16 holidays at Kshs.550), not the additional double-rate pay claimed for days worked.

p. 4
04

Entitlement to service pay and severance

Holding

Service pay was not awarded on the NSSF exemption basis urged by the respondent, and severance pay was rejected as there was no redundancy.

Reasoning

The respondent argued the claimant, being an NSSF member, was not entitled to service pay under section 35(6)(d). The claimant's final itemised award made no provision for service pay, and the court expressly rejected the severance pay prayer because the claimant was not declared redundant.

p. 4

Legal principles established

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  • A casual employee who has worked for the equivalent of not less than one month or whose work cannot be completed within three months is deemed by section 37(1) of the Employment Act to be employed on monthly terms.
  • There is no such thing as permanent employment; every contract of employment is terminable by notice, and the Employment Act's minimum terms are implied in every contract.
  • An employer must prove both valid reason and fair procedure for a termination to be fair under section 45 of the Employment Act.

Court orders

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  1. 1.Declaration that the claimant's employment was converted to monthly contract terms by virtue of Section 37(1) of the Employment Act
  2. 2.Declaration that the termination of the claimant's employment was unfair
  3. 3.Payment in lieu of notice of Kshs.16,500
  4. 4.Pay in lieu of annual leave of Kshs.15,400
  5. 5.Paid rest days of Kshs.44,000
  6. 6.Paid public holidays of Kshs.8,800
  7. 7.Two days' salary not paid of Kshs.1,100
  8. 8.Compensation for unfair termination of three months' salary in the sum of Kshs.49,500
  9. 9.Total award of Kshs.135,300
  10. 10.Respondent to pay the claimant's costs
  11. 11.Interest to accrue on the decretal sum from the date of judgment

Authorities

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Legislation

  • Employment Actsections 3(6), 26, 35, 35(6)(d), 37(1)-(4), 41, 43, 44(1), 45(1)-(3), 47(5), 87
  • Regulation of Wages and Conditions of Employment Actnot specified

Cases cited (2)

  • Abisalom Ajusa Magomere vs Kenya Nut Company Limited
    ELRC Cause No. 2525 of 2012
  • Josephat Njuguna –vs– High Rise Self Group Nairobi
    Cause No. 12 of 2012
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act and the dispute referred under sections 41, 43, 45 and 47(5) of the Employment Act

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 Wambua Kitheka v Endmor Steel Millers Limited [2018] KEELRC 427 (KLR)", Case Analysis (2018). ELRC Cause (Nairobi), filed 22nd June 2012. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/427/eng@2018-11-30

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