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ELRCPartially AllowedCause No 700 of 2010· [2019] KEELRC 2491 (KLR)

Rodgers Atuulo Ambasu v Budget Payless Car Hire &Tours; Limited [2019] KEELRC 2491 (KLR)

Employment and Labour Relations Court
18 January 2019
MOMaureen Onyango
2,236 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Employment Court ruled that firing an employee with only a same-day show cause letter is unfair; employers must hold documented disciplinary hearings.

What this practically means

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Executive summary

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The claimant, a mechanic, sued for wrongful termination and terminal dues after his employment ended on 17th August 2009 on grounds of negligence and poor performance. The respondent admitted the employment and certain terminal dues (notice pay, 17 days' salary, house allowance, earned leave and a certificate of service) but defended the termination. The parties proceeded by written submissions with adopted affidavit and witness statement evidence. The court framed three issues: validity of the termination both procedurally and substantively, entitlement to reliefs, and costs. It found the termination unfair: although a show cause letter was allegedly issued, the response time was too short, no notice or minutes of any disciplinary meeting were availed, and the claimant disputed service of the warning letters. Relying on Mumias Sugar and Walter Ogal Anuro, the court held termination requires both substantive justification and procedural fairness, and found the termination invalid on both limbs. On remedies, the claim for gratuity failed because the claimant was an NSSF contributor under Section 35(6)(d) and did not prove contractual gratuity. Judgment was entered for Kshs.44,034.15, being 17 days' salary (Kshs.9,597.15), one month's pay in lieu of notice (Kshs.14,678) and 35 days' leave (Kshs.19,759), plus a certificate of service, interest from filing on the admitted dues, and costs of the suit.

Key legal issues

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01

Whether the termination was procedurally fair under Section 41 of the Employment Act

Holding

Termination was procedurally unfair; the show cause notice allowed too little time and no documented disciplinary hearing with notice and minutes was proved

Reasoning

Although a show cause letter was allegedly issued, it was to be submitted at 3 pm on the same day, which the court found too short. No evidence of notice of the meeting or minutes was produced. Relying on Section 41 and precedent, the court found the claimant was not taken through the disciplinary process.

p. 4
02

Whether there was substantive justification for the termination

Holding

Termination was invalid substantively; the alleged poor performance was not established through a valid process

Reasoning

The court found that for a termination to pass the fairness test there must be both substantive justification and procedural fairness. Having found the procedure wanting and the warnings disputed and unproved through a hearing, it concluded the termination was invalid on both limbs.

p. 4
03

Entitlement to gratuity/service pay

Holding

Claim fails because NSSF membership attracts the Section 35(6) exemption and no contractual gratuity was proved

Reasoning

Payslips showed Kshs.200 monthly NSSF deductions, engaging the Section 35(6)(d) exemption. The claimant also did not prove his terms of employment provided for gratuity, so the claim for gratuity fails.

p. 4

Legal principles established

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  • Fairness in termination requires more than issuance of a show cause letter; the employer must conduct a proper, documented disciplinary hearing with reasonable time to respond
  • A termination must pass both the substantive justification and procedural fairness tests

Court orders

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  1. 1.Salary for 17 days worked in August 2009 - Kshs.9,597.15
  2. 2.Pay in lieu of notice - Kshs.14,678
  3. 3.Leave 35 days - Kshs.19,759
  4. 4.Certificate of service
  5. 5.Interest on the admitted dues from date of filing of suit
  6. 6.Respondent to pay the claimant's costs of the suit

Authorities

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Legislation

  • Employment ActSection 40(1)
  • Employment ActSection 41
  • Employment ActSections 41(1), 42(1), 44(3) and (4)
  • Employment ActSection 43
  • Employment ActSection 45 and 45(2)
  • Employment ActSection 35(6) and 35(6)(d)
  • Employment ActSection 49(1)

Cases cited (5)

  • Moses Kaunda Moro –Vs- CMC Motors Group Limited
    (2013) eKLR
  • Onesmus Omwenga Maroko –Vs- Cooperative Bank of Kenya Limited
    (2014) eKLR
  • Naman Muriuki –Vs- P.N Mashru Limited
  • Mumias Sugar Company Limited versus Kenya Union of Sugarcane Plantation Workers
    (2017) eKLR
  • Walter Ogal Anuro –v- Teachers Service Commission
    (2013) eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 (unfair termination claim)

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (1)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Rodgers Atuulo Ambasu v Budget Payless Car Hire &Tours; Limited [2019] KEELRC 2491 (KLR)", Case Analysis (2019). Cause No 700 of 2010. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2019/2491/eng@2019-01-18

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