Whycliffe Bundi v Flame Tree Africa Limited [2018] KEELRC 1464 (KLR)
The bottom line
#A Kenyan court ruled a sales manager was unfairly terminated and awarded him ten months' salary because his employer couldn't prove his earnings or a fair dismissal process.
What this practically means
#Executive summary
#Key legal issues
#Existence of an employment relationship after conversion to retainer plus commission
The letter of 11th March 2016 changing the Claimant to a monthly retainer of Kshs. 10,000 plus 4% commission did not end the employment relationship, as all other terms and conditions of employment remained unchanged and subsequent letters acknowledged the Claimant as an employee
The Respondent argued, relying on two decisions, that the letter of 11th March 2016 changed the relationship so that no employment existed. The Court rejected this, noting the letter itself preserved all other terms and conditions of the contract, and that subsequent letters issued by the Respondent acknowledged the Claimant as an employee. The issue was therefore a non-issue.
Lawfulness and fairness of the termination
The termination was substantively and procedurally unfair. The termination letter cited low sales but also referred to a disciplinary hearing, while allegations of misconduct were not pursued at the shop floor as required under Section 41 of the Employment Act, and the same-day glowing recommendation letter contradicted the allegations
The termination letter cited inability to sustain expenses due to low sales yet also referred to a disciplinary hearing. The Respondent's witness alleged underperformance, misuse of vehicles, absenteeism and absconding, but the Claimant denied receiving warnings or show cause letters. The Court could not reconcile the allegations with the same-day recommendation letter describing the Claimant as hardworking and reliable.
Applicable monthly salary for purposes of compensation
The Court adopted the pleaded figure of Kshs. 54,492.50 as the monthly salary because the Respondent, as custodian of employee records, failed to provide the average monthly salary inclusive of commission, invoking Section 10(7) of the Employment Act
The payslips showed basic pay of Kshs. 10,000 with varying commissions of between Kshs. 50,161 and 100,223. Since the Respondent was the custodian of employee records and failed to discharge the responsibility of establishing the average monthly salary, the Court invoked Section 10(7) of the Employment Act and adopted the Claimant's pleaded figure.
Legal principles established
#- Where an employer, as custodian of employee records, fails to provide the average monthly salary including commission, the Court may adopt the salary figure pleaded by the employee under Section 10(7) of the Employment Act
- A variation of pay structure (retainer plus commission) does not break the employment relationship where the employer expressly states that all other terms and conditions of the contract remain unchanged
Court orders
#- 1.Declaration that the termination of the Claimant's employment was substantively and procedurally unfair
- 2.Award of Kshs. 544,925 being ten (10) months' salary in compensation, using the monthly salary of Kshs. 54,492.50 adopted under Section 10(7) of the Employment Act
- 3.Interest on the award at court rates from the date of judgment until payment in full
- 4.Costs of the case to the Claimant
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction over employment disputes under the Employment Act, 2007 (provisions including Sections 10(7) and 41 applied)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Whycliffe Bundi v Flame Tree Africa Limited [2018] KEELRC 1464 (KLR)", Case Analysis (2018). Cause No 266 of 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2018/1464/eng@2018-07-12
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.