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ELRCPartially AllowedNot stated in the judgment as provided· [2020] KEELRC 1659 (KLR)

Dorice Makobe v Hotel Baracuda Inn Ltd [2020] KEELRC 1659 (KLR)

Employment and Labour Relations Court
12 February 2020
1,539 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 ruled a hotel constructively dismissed a room steward by punishing her unfairly during a theft investigation, awarding her over Kshs. 97,000.

What this practically means

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Executive summary

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The Claimant, employed as a Room Steward from 19th January 2009, sued the Respondent hotel for unlawful termination of employment following a 1st September 2017 guest theft incident. She and two colleagues were handed over to the Watamu Police, who found no evidence implicating them. On 2nd September 2017 she was told her employment had been terminated. She claimed notice pay, house allowance, leave allowance, service fees, underpayment and damages for wrongful dismissal. The Respondent admitted employment but denied diligence, asserted she was a casual worker on seasonal contracts, conceded one month's notice pay, and contended she had only been suspended for two weeks and chose not to return. The court framed two issues: whether termination was unlawful and what remedies were due. It held that the Respondent's conduct - selectively suspending only the Claimant, suspending and surcharging her for the same offence (double jeopardy), and withholding her salary during suspension - made her employment untenable and amounted to constructive dismissal, applying the Court of Appeal's definition in Coca Cola v Ligaga and following Kefa Omae Obiri on suspension as a neutral action. It awarded six months' salary in compensation, one month's notice pay (admitted), house allowance at 15% of basic salary for three months (July-September 2017, treating the adopted monthly salary as Kshs. 12,075), and one year's leave allowance, total Kshs. 97,702 with interest and costs. Claims for service fees and underpayment were dismissed as unproved. Judgment was delivered at Malindi on 12th February 2020 by Linnet Ndolo, Judge.

Key legal issues

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01

Whether the Claimant was unlawfully terminated

Holding

The Respondent's actions of selectively suspending, surcharging and withholding salary made the Claimant's employment untenable, amounting to constructive dismissal

Reasoning

The court found that targeting only the Claimant for suspension among colleagues implicated in the same theft incident was unjustified; suspending and surcharging her for the same offence subjected her to double jeopardy; and withholding her salary during suspension undermined the professed investigative purpose. Cumulatively these actions rendered her employment untenable and amounted to constructive dismissal as defined by the Court of Appeal in Coca Cola East & Central Africa Limited v Maria Kagai Ligaga.

p. 2
02

Entitlement to house allowance

Holding

House allowance allowed at 15% of basic salary for three months (July to September 2017), adopting Kshs. 12,075 as monthly salary

Reasoning

Section 31(1) and (2) of the Employment Act obliges an employer to provide reasonable housing or pay a sufficient sum as rent unless the contract consolidates a housing element in the wage. The Respondent produced no document proving payment of house allowance, so the claim was allowed at 15% of basic salary. The court limited the period to three months because the Claimant's own testimony showed she worked on seasonal contracts during the high season from July to March.

p. 3
03

Whether the Claimant was a casual employee and entitled to leave pay

Holding

The averment that the Claimant was a casual employee was unsupported; leave pay allowed for one year

Reasoning

The Respondent's Manager asserted in her witness statement that the Claimant was not entitled to leave because she was a casual employee. However, no evidence supported that averment. Moreover, the Respondent conceded one month's salary in lieu of notice, which would not be payable to a casual employee, undermining its own characterisation. The court therefore allowed leave pay for one year, computed as 12,075/30 x 21.

p. 3

Legal principles established

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  • Suspension is a neutral action to allow for investigations and should not attract adverse action such as withholding of salary absent statutory provision
  • Suspension and surcharging an employee for the same offence constitutes double jeopardy and, cumulatively with other unjustified actions, can amount to constructive dismissal

Court orders

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  1. 1.Judgment entered in favour of the Claimant in the sum of Kshs. 97,702, being 6 months' salary in compensation (Kshs. 72,450), 1 month's salary in lieu of notice (Kshs. 12,075), house allowance for 3 months @ Kshs. 1,575 (Kshs. 4,725) and leave allowance for 1 year (Kshs. 8,452)
  2. 2.The awarded amount to attract interest at court rates from the date of judgment until payment in full
  3. 3.The Claimant to have the costs of the case

Authorities

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Legislation

  • Employment ActSection 31(1) and (2)

Cases cited (2)

  • Kefa Omae Obiri v Imani Marianist Organization
    [2018] eKLR
  • Coca Cola East & Central Africa Limited v Maria Kagai Ligaga
    [2015] eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act and the Labour Relations Act (not expressly cited in the judgment text)

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, "Dorice Makobe v Hotel Baracuda Inn Ltd [2020] KEELRC 1659 (KLR)", Case Analysis (2020). Not stated in the judgment as provided. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2020/1659/eng@2020-02-12

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