Fredrick Ouma Otieno v Falcon Signs Limited [2020] KEELRC 834 (KLR)
The bottom line
#What this practically means
#Executive summary
#Key legal issues
#Fairness of termination
The verbal termination without notice or hearing was unfair and unlawful under Section 45 of the Employment Act
The claimant testified that his services were verbally terminated on grounds of reduced workload, without notice or a hearing. The respondent did not enter appearance or file a defence, so the evidence was uncontroverted. The court also found no proof by the respondent of the reasons for termination as required by Section 43 of the Employment Act.
Payment in lieu of untaken leave
Awarded at KES 19,936 for the 2 years worked because the respondent produced no leave records
Sections 10 and 74 of the Employment Act require employers to keep records of employees' leave entitlement and days taken. Under Section 10(7), failure to produce such records shifts the burden to the employer. The respondent, having not defended the claim, produced no leave records, so the claimant's claim for untaken leave over 2 years was awarded.
Compensation for unfair termination
Compensation equivalent to 6 months' salary (KES 86,520) awarded under Section 49 of the Employment Act
Having found unfair termination, the court considered the circumstances of the termination and the factors in Section 49 of the Employment Act, notably that the claimant had served for 2 years on a fairly meagre salary of KES 14,240 per month. It found the equivalent of 6 months' salary to be reasonable compensation in the circumstances.
Service gratuity and unremitted statutory deductions
Claim failed for want of proof of non-remittance
The payslips showed NHIF and NSSF deductions, but the claimant produced no statements proving non-remittance to the relevant bodies, which it was incumbent on him to provide. The court noted that NSSF and NHIF have statutory mechanisms, including penalising employers, to give the claimant recourse if the sums were not remitted.
Legal principles established
#- Verbal termination without notice or a hearing is unfair termination under Section 45 of the Employment Act, and the employer bears the burden of proving reasons for termination under Section 43
- Where an employer fails to produce employment records such as leave records, the burden falls on the employer to prove or disprove the alleged term of employment
Court orders
#- 1.Judgment entered in favour of the claimant for the sum of KES 120,696/= (one month's notice pay KES 14,240; leave for 2 years KES 19,936; compensation equivalent of 6 months' salary KES 86,520)
- 2.Costs of the suit to the claimant
- 3.Interest on the decretal sum from the date of judgment until payment in full
- 4.Respondent to forthwith issue the claimant with his Certificate of Service
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction over employment disputes (Employment Act, 2007)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Fredrick Ouma Otieno v Falcon Signs Limited [2020] KEELRC 834 (KLR)", Case Analysis (2020). Cause No. 1049 of 2016. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2020/834/eng@2020-06-19
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.