Loise Njeri v Devkan Enterprises Limited [2020] KEELRC 428 (KLR)
The bottom line
#A Kenyan court ruled a dismissal can have a valid reason but still be unfair if the employer skips a hearing, awarding the ex-employee over KShs. 641,000.
What this practically means
#Executive summary
#Key legal issues
#Valid and fair reason for summary dismissal
Absconding duty from 6.12.2018 to 8.12.2018 without leave or proof of medical incapacity was a valid and fair reason under section 44(4)(a); poor performance was not proved.
The claimant's sick off covered only 6.12.2018 and she produced no written permission for the remaining days. The poor performance allegation was unrebutted evidence of no warnings, appraisals or performance management, so the respondent failed to discharge the high burden of proof required for performance-based terminations.
Fair procedure before termination
The termination was procedurally unfair because the claimant was not accorded a hearing under section 41 of the Employment Act.
Despite the grounds being misconduct and poor performance, the claimant was never heard nor told the reason before termination, and RW1 adduced no evidence to rebut her allegation. Section 45 was therefore breached and the summary dismissal was unfair.
Remedies: compensation, leave, gratuity, house allowance, loss of income
Four months' salary as compensation, 18 days' leave pay and gratuity as claimed awarded; loss of income to retirement and house allowance claims failed.
The court considered the claimant's two years of service, lack of alternative employment and her contributory misconduct in fixing compensation at four months. Loss of income is capped at twelve months' wages, which the compensation award already covered. Gross pay was found inclusive of house allowance, and leave was limited to the admitted 18 days.
Diversion of terminal dues to the Sacco as guarantor
The claimant is entitled to all damages awarded less statutory deductions, as the respondent proved neither default nor written authorization.
The respondent did not produce Sacco receipts, the loan agreement, or proof of default. A guarantor's rights and liability arise only upon the principal debtor's default, so payment of terminal dues to the Sacco without the claimant's written authorization was unjustified.
Legal principles established
#- Termination of employment is unfair where the employer fails to prove a valid and fair reason and that a fair procedure was followed.
- Poor performance as a ground of termination requires the employer to have put in place a policy or practice for measuring performance; the burden of proof is high.
- Compensation for loss of earnings following unfair termination is capped at the equivalent of twelve months' gross wages.
- A guarantor's liability does not arise before default by the principal debtor; terminal dues cannot be diverted to a guarantor without proof of default.
Court orders
#- 1.Leave pay of KShs. 76,028.03
- 2.Compensation for unfair termination of KShs. 439,273.04 (4 months' salary)
- 3.Service gratuity of KShs. 126,690.00
- 4.Total judgment of KShs. 641,991.07 less statutory deductions and any amount the claimant has authorized the respondent in writing
- 5.Costs of the suit to the Claimant together with interest at court rates from the date of judgment
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 (ELRC Procedure Rules referenced regarding online delivery)
Key timeline
#Practical implications
#Frequently asked questions
#Later judgments citing this (1)
#Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.
- SGA Security Solutions Limited v Mulei (Appeal E136 of 2023) [2024] KEELRC 1406 (KLR)[2024] KEELRC 1406 (KLR)23 May 2024followed
Cite this brief
#Cite this brief
Caselaw, "Loise Njeri v Devkan Enterprises Limited [2020] KEELRC 428 (KLR)", Case Analysis (2020). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2020/428/eng@2020-10-01
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.