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ELRCPartially AllowedCause No. 396 of 2014 (consolidated with Cause No. 595 of 2014)· [2018] KEELRC 443 (KLR)

Joseph Otieno Onyango & 3 others v Jihan Freighters Limited [2018] KEELRC 443 (KLR)

Employment and Labour Relations Court
14 December 2018
1,974 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Mombasa court confirmed long-serving 'casual' workers are regular employees, but still cut their compensation because they ignored lawful employer instructions.

What this practically means

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Executive summary

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Four former employees of a courier, clearing and forwarding company filed consolidated claims (Cause No. 396 of 2014, consolidated with Cause No. 595 of 2014) alleging unfair termination in May 2012 after they went on strike over insufficient salaries. They sought notice pay, 12 months' compensation, accrued annual leave, house allowance, overtime, certificates of service and costs. The Respondent maintained the Claimants were on fixed term contracts which expired, after which they became casuals paid daily wages, and that they were denied warehouse access for refusing to surrender identity cards. The court found the Claimants, having worked the same roles in continuity for over 6 years from 2005/2006, were deemed regular employees entitled to Employment Act 2007 protections, notwithstanding reversion to casual terms. Termination was based on a valid reason - gross misconduct in persistently refusing reasonable and lawful instructions to surrender identity cards - so the Respondent could have summarily dismissed them without notice. However, procedure was flawed: no disciplinary hearing, letters, or charges were afforded, breaching Sections 41 and 45. The court awarded minimal compensation of 1½ months' salary (Kshs. 15,000) per Claimant, and house allowance at 15% of Kshs. 10,000 for the 24-month contract period (Kshs. 36,000) per Claimant, and ordered certificates of service. Claims for notice pay, annual leave, overtime and unpaid salaries were rejected; no order was made on costs. Judgment was delivered at Mombasa on 14th December 2018 by James Rika, Judge.

Key legal issues

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01

Status of the Claimants: casual or regular employees

Holding

Claimants deemed regular employees by reason of aggregate continuous service over 6 years

Reasoning

The Claimants worked as Loaders and Clerks from 2005/2006, initially as casuals, then on 2-year term contracts, reverting to casual terms after expiry. The court looked at the aggregate number of days worked rather than absences, found continuity of the same work for over 6 years, and held they qualified as regular employees entitled to Employment Act protections.

p. 2
02

Validity of the reason for termination

Holding

Valid reason existed - gross misconduct by persistent refusal to surrender identity cards

Reasoning

The Respondent had good reason to require identity cards for warehouse security and payment purposes. Employees who complied continued working. Refusal to obey reasonable, lawful instructions amounted to gross misconduct under Section 44(4), justifying summary dismissal; hence no notice pay.

p. 3
03

Procedural fairness of the termination

Holding

Procedure flawed; no disciplinary hearing, charges or letters were issued

Reasoning

Although the Claimants' refusal of workplace access complicated the process, the Respondent should have attempted a disciplinary hearing, issued letters requiring explanation, presented charges and heard the Claimants. Sections 41 and 45 procedural protections were disregarded, warranting compensation albeit minimal given the Claimants' contributory misconduct.

p. 3
04

Terminal dues: leave, overtime, house allowance, certificates of service

Holding

House allowance for 24 months and certificates of service granted; leave and overtime claims rejected

Reasoning

Leave dues were paid and leave taken, so the leave claim failed. Overtime was not proved as excess hours were not established as necessary and authorized. House allowance was payable only over the 2-year contract period at 15% of the basic salary, since pay slips described salaries as basic with no housing provision. Certificates of service ordered under Section 51.

p. 3

Legal principles established

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  • Employees who work in continuity over an aggregate period of over 6 years cannot be treated as casual employees; they are deemed regular employees
  • An employer must still afford procedural fairness under Sections 41 and 45 of the Employment Act even where the employee has committed gross misconduct
  • Refusal to obey reasonable and lawful instructions constitutes gross misconduct under Section 44(4) of the Employment Act

Court orders

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  1. 1.Declaration that termination was based on valid reason but flawed on procedure
  2. 2.Respondent to pay compensation for unfair termination to each Claimant at 1½ months' salary at Kshs. 15,000
  3. 3.Respondent to pay each Claimant arrears of house allowance over a period of 2 years, at Kshs. 36,000
  4. 4.Certificates of Service to issue to the Claimants
  5. 5.No order on the costs

Authorities

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Legislation

  • Employment ActSections 41, 43, 44[4], 45, 51
Jurisdiction invoked
Article 162(2) of the Constitution (Employment and Labour Relations Court jurisdiction; claims 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 Otieno Onyango & 3 others v Jihan Freighters Limited [2018] KEELRC 443 (KLR)", Case Analysis (2018). Cause No. 396 of 2014 (consolidated with Cause No. 595 of 2014). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/443/eng@2018-12-14

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