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ELRCPartially AllowedCause No. 1486 of 2013· [2018] KEELRC 649 (KLR)

Alex Mutua Muendo Muema & 3 others v Malplast Industries Limited [2018] KEELRC 649 (KLR)

Employment and Labour Relations Court of Kenya
24 October 2018
HWHellen S. Wasilwa
1,235 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 four employees up to 12 months' salary because their employer could not prove why they were fired or give them a hearing.

What this practically means

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Executive summary

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Four employees of Malplast Industries Limited sued for wrongful and unlawful termination of employment and failure to pay terminal dues. They were employed between 2009 and 2012 as a machine operator, machine attendant, machine operator and welder, and their services were terminated between June and July 2013. They alleged they were told the work had reduced and asked to go, without notice, hearing or terminal dues. The Respondent admitted the employment relationship but asserted the Claimants were on fixed term contracts which they served, and alternatively that they were dismissed for irresponsibility, negligence, insubordination and absenteeism after warning letters. The court framed two issues: whether the termination was lawful and fair, and whether the Claimants were entitled to the remedies sought. The Respondent's Human Resource Manager admitted in cross-examination that no notices were issued and no reasons given for termination, and the Respondent failed to produce the warning letters it had pleaded. Applying sections 41, 43 and 45 of the Employment Act, 2007, the court held the terminations unfair and unjustified. It awarded the 1st, 3rd and 4th Claimants twelve months' salary and the 2nd Claimant six months' salary as compensation for unlawful termination, plus one month's salary in lieu of notice each, with interest. The claims for leave and travelling allowance were rejected as not justified under the employment contracts and because leave had been utilized. The Respondent was ordered to pay costs plus interest at court rates from the date of judgment.

Key legal issues

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01

Whether the termination of the Claimants was lawful and fair

Holding

The termination was unfair and unjustified because the Respondent failed to prove valid reasons for termination and did not accord the Claimants a hearing.

Reasoning

Section 43 of the Employment Act obliges the employer to prove the reasons for termination, failing which the termination is deemed unfair under section 45. Although the Memorandum of Response alleged misconduct (irresponsibility, negligence, insubordination and absenteeism) and warning letters, the Respondent's HR Manager admitted in cross-examination that no reasons were given and no notices issued, and the Respondent failed to produce the pleaded warning letters. There was also no hearing, contrary to section 41.

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02

Whether the Claimants are entitled to the remedies sought

Holding

The Claimants were awarded the equivalent of 12 months' gross salary (6 months for the 2nd Claimant) as compensation for unlawful termination plus one month's salary in lieu of notice, but the claims for leave and travelling allowance failed.

Reasoning

Having found the terminations unfair, the court exercised its discretion under section 49 of the Employment Act to award compensatory damages equivalent to 12 months' salary for most Claimants and 6 months for the 2nd Claimant as prayed, plus notice pay. However, the contractual claims for leave and travelling allowances were not justified, leave having been utilized and no contractual provision existing for travelling allowance.

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Legal principles established

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  • An employer who fails to prove the reason or reasons for termination of employment renders the termination unfair under sections 43 and 45 of the Employment Act.
  • Before terminating employment on grounds of misconduct, an employer must accord the employee a hearing as required by section 41 of the Employment Act.

Court orders

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  1. 1.12 months' salary as compensation for unlawful termination for the 1st, 3rd and 4th Claimants and 6 months' salary for the 2nd Claimant (computed: 1st Claimant Kshs. 209,760; 2nd Claimant Kshs. 75,384; 3rd Claimant Kshs. 264,384; 4th Claimant Kshs. 209,760)
  2. 2.One month's salary in lieu of notice to each Claimant (1st Kshs. 17,480; 2nd Kshs. 12,564; 3rd Kshs. 22,032; 4th Kshs. 17,480)
  3. 3.Total awards: 1st Claimant Kshs. 227,240; 2nd Claimant Kshs. 87,948; 3rd Claimant Kshs. 286,416; 4th Claimant Kshs. 227,240
  4. 4.Respondent to pay costs of the suit plus interest at Court rates with effect from the date of the judgment

Authorities

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Legislation

  • Employment Act, 2007Section 43(1) and (2)
  • Employment Act, 2007Section 41(1) and (2)
  • Employment Act, 2007Section 45(2)
  • Employment Act, 2007Section 42(1)
  • Employment Act, 2007Section 44(3) and (4)
Jurisdiction invoked
Article 162(2) of the Constitution establishing the Employment and Labour Relations Court (employment dispute 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, "Alex Mutua Muendo Muema & 3 others v Malplast Industries Limited [2018] KEELRC 649 (KLR)", Case Analysis (2018). Cause No. 1486 of 2013. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/649/eng@2018-10-24

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