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ELRCDismissedCause No. 65 of 2018· [2020] KEELRC 1442 (KLR)

Paul Maina Gichohi v Hatari Security Guards [2020] KEELRC 1442 (KLR)

Employment and Labour Relations Court of Kenya
20 February 2020
2,890 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan court dismissed a manager's claims for various dues after resignation and ordered him to pay his former employer Ksh.598,200 over ghost-worker fraud.

What this practically means

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Executive summary

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The claimant, employed by the respondent for about 13 years and last serving as a manager earning Ksh.37,100 per month, resigned by notice dated 11th September 2017 citing frustration, late wage payments and constant transfers. He claimed terminal dues including disturbance allowances, uniform refund, public holiday pay, refund for purchase of sniffer dogs, wage arrears, severance pay, leave days, off days and a certificate of service. The respondent opposed the claim, contending the claimant utilised his leave, was paid transfer allowances, and that as a manager he regulated his own off days and wore no uniform. It further alleged the claimant defrauded it of Ksh.598,200 by processing wages for seven ghost workers in the Western and Nyanza regions, and filed a counter-claim for that sum, which went undefended. The court held that the claims were general and lacked particulars as required under section 47(5) of the Employment Act; that disturbance allowance is only due if contractually provided; that severance pay applies only to redundancy under section 40; that service pay raised in submissions but not pleaded could not be entertained; and that the sniffer dog expense was unproved. The leave taken exceeded the statutory entitlement. The only entitlement was a certificate of service under section 51. The uncontroverted counter-claim, supported by audit and investigation evidence, succeeded. The claim was dismissed and judgment entered for the respondent on the counter-claim for Ksh.598,200 with costs.

Key legal issues

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01

Entitlement to terminal dues after resignation

Holding

All the claims for disturbance allowance, uniform refund, public holiday pay, sniff dogs refund, wage arrears, severance pay, leave and off days failed for lack of particulars and proof; only the certificate of service was due

Reasoning

The court found the claims were general and unsupported. Leave taken exceeded statutory entitlement under section 28(2). Severance pay applies only to redundancy. The claimant resigned voluntarily and sought no specific remedy for the alleged frustration. The only entitlement flowing from the resignation was a certificate of service under section 51 of the Employment Act.

p. 4
02

Service pay raised at submissions stage

Holding

Service pay under section 35(5) could not be awarded as the claimant pleaded severance pay, not service pay

Reasoning

The claimant pleaded severance pay but urged service pay in submissions. The court held that a party cannot amend pleadings through submissions, as this would ambush the opposing party and deny it an opportunity to reply.

p. 4
03

Counter-claim for ghost workers fraud

Holding

The counter-claim for Ksh.598,200 was allowed as uncontroverted and supported by audit evidence

Reasoning

There was no defence or reply to the counter-claim. The respondent's witnesses testified that a staff audit revealed ghost workers whose wages the claimant processed, causing a loss of Ksh.598,200. The matter had been reported to police. The court found the respondent had a genuine and reasonable cause and entered judgment for the counter-claim.

p. 5

Legal principles established

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  • Disturbance allowance on transfer is only payable where there is a contractual or agreed entitlement
  • An employee must particularise wrongful conduct under section 47(5) of the Employment Act for general claims to succeed
  • A party cannot introduce a new claim in submissions that was not pleaded
  • Severance pay is only due upon redundancy under section 40 of the Employment Act, not on resignation
  • An employer who proves loss from employee fraud is entitled to judgment on an uncontroverted counter-claim

Court orders

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  1. 1.The claimant's claim is dismissed
  2. 2.Judgment entered for the respondent on the counter-claim for Ksh.598,200 to be paid with costs
Jurisdiction invoked
Employment and labour relations jurisdiction of the Employment and Labour Relations Court

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "Paul Maina Gichohi v Hatari Security Guards [2020] KEELRC 1442 (KLR)", Case Analysis (2020). Cause No. 65 of 2018. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2020/1442/eng@2020-02-20

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