Kananga M’nchebere & another v East African Portland Cement Company Limited [2019] KEELRC 2247 (KLR)
The bottom line
#A Kenyan court awarded two dismissed managers over Kshs.8 million total, ruling they were unfairly caught in their employer's ownership power struggle.
What this practically means
#Executive summary
#Key legal issues
#Validity and fairness of the termination
Termination was not for a valid reason and did not follow a fair procedure, violating sections 41, 43 and 45 of the Employment Act
The Claimants were caught between an ownership and control wrangle between the Government and the Board. The disciplinary action by the Managing Director was not based on tangible evidence, was conducted in the turmoil of the dispute, and the Claimants were hounded out merely for being seen to support Government. Both substantive justification and procedural fairness failed.
Gratuity calculated at 18% instead of contractual 31%
Claimants entitled to the 13% differential on the basic salary for completed years of service
The appointment letters provided gratuity at 31% of basic salary per completed year, but the Respondent calculated at 18% for the 21 served months. The court awarded the 13% shortfall to both Claimants.
Quantum of compensation under section 49(1)(c)
Three months' salary each awarded despite the unlawful and unfair termination
The six months' notice pay largely mitigated the loss and the Claimants had acquired alternative employment. Considering cited precedents awarding 3 to 12 months, the court settled on 3 months' salary each.
Counterclaim for losses from factory closure
Counterclaim not established; no evidence linking the Claimants to the losses
RW 2 confirmed under cross-examination that the operation of the Respondent depended on the Board, Managing Director, heads of departments and individual staff, and its closure did not depend on the two Claimants. The counterclaim therefore had no merit.
Legal principles established
#- For a termination of employment to pass the fairness test, there must be both substantive justification and procedural fairness
Court orders
#- 1.Declaration that the termination of the Claimants' employment was unlawful and unfair
- 2.1st Claimant awarded: Kshs.2,499,975 in compensation; additional gratuity Kshs.1,428,677.25; in lieu of leave Kshs.354,361.28; total Kshs.4,283,013.53
- 3.2nd Claimant awarded: Kshs.2,365,203 in compensation; additional gratuity Kshs.1,428,884.73; in lieu of leave Kshs.80,564.86; total Kshs.3,874,652.59
- 4.Interest at court rates from date of judgment on compensation and from date of filing suit on gratuity and leave pay till payment in full
- 5.Respondent to pay costs of the suit to both Claimants
- 6.Counterclaim dismissed (no relief granted to the Respondent on the counterclaim)
- Jurisdiction invoked
- Original jurisdiction under the Employment Act, 2007 (sections 41, 43, 45, 47, 49(1)(c) invoked)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kananga M’nchebere & another v East African Portland Cement Company Limited [2019] KEELRC 2247 (KLR)", Case Analysis (2019). N/A - not stated in the judgment extract. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/2247/eng@2019-02-15
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.