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ELRCDismissedCause No. 521 of 2014· [2020] KEELRC 1733 (KLR)

Alexander Oduor Oboya v Catholic Diocese of Nakuru [2020] KEELRC 1733 (KLR)

Employment and Labour Relations Court of Kenya
23 January 2020
868 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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The Employment Court dismissed a worker's claims for underpayment, gratuity and unpaid salary because the employer's payment records and NSSF remittances proved compliance with the law.

What this practically means

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Executive summary

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The claimant, a general worker at the respondent's Hekima Nursery, claimed terminal dues comprising underpayments of Ksh.183,406.70 contrary to the wage orders, gratuity for 13 years of service of Ksh.67,455.40, and unpaid salary for July and August 2014, alleging he requested early retirement on medical recommendation, gave 30 days' notice, and received inadequate final dues. The respondent denied the claims, asserting the claimant resigned on 30th June 2014, his resignation was accepted on 1st August 2014, and his final dues - including July 2014 wages, gratuity paid in goodwill, and an underpayment adjustment of Ksh.400 - were fully paid, less a loan offset. The respondent filed work records and payment vouchers which the court found unchallenged. The court held that assessed against the applicable wage orders the claimant was not underpaid. On gratuity, it found that although gratuity is due under a written contract or private treaty, the respondent's remittance of statutory dues to NSSF and NHIF in compliance with section 35 of the Employment Act, 2007 defeated any claim for service pay. On the unpaid salary claims, the court held that upon acceptance of the claimant's early retirement there was no obligation to keep him in employment, which would amount to servitude, and that the final dues included the July 2014 wage. The court found the final dues paid generous, dismissed the entire claim, and ordered each party to bear their own costs.

Key legal issues

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01

Underpayment contrary to wage orders

Holding

The claimant was not underpaid; the unchallenged work records and payment vouchers showed wages paid were in line with the applicable wage orders.

Reasoning

The respondent filed work records and payment vouchers covering the duration of service, which were not challenged by the claimant. Assessed against the applicable wage orders for a general worker, the wages paid did not fall below the prescribed minima. The claim for underpayments of Ksh.183,406.70 therefore failed on the documentary evidence.

p. 2
02

Gratuity/service pay

Holding

The gratuity claim failed because the respondent remitted statutory dues to NSSF and NHIF as required by section 35 of the Employment Act, 2007.

Reasoning

Gratuity is normally due under a written contract or private treaty. Even if the claimant's claim were treated as one for service pay, the payment vouchers showed statutory deductions remitted to NSSF and NHIF. Compliance with section 35 of the Employment Act, 2007 disentitles an employee to service pay, so the claim was without merit.

p. 2
03

Unpaid salary for July and August 2014

Holding

No salary was owed for July or August 2014; the claimant's early retirement was accepted and the July 2014 wage was included in the final dues paid.

Reasoning

The claimant tendered his resignation/letter of early retirement which was accepted by the respondent. Upon the lapse of the 30-day notice he was not required to attend work. The final dues paid included the wage due in July 2014, and keeping him in employment after acceptance of his retirement would amount to servitude. The claims for July and August 2014 salaries therefore failed.

p. 2

Legal principles established

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  • Where an employer has complied with section 35 of the Employment Act, 2007 by remitting statutory dues (NSSF and NHIF), a claim for service pay or gratuity fails.
  • An employer has no obligation to retain an employee who has applied for and been granted early retirement; such retention would amount to servitude.

Court orders

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  1. 1.The claims made are found without merit and are hereby dismissed
  2. 2.Each party shall bear own costs

Authorities

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Legislation

  • Employment Act, 2007section 35
Jurisdiction invoked
Employment and labour relations jurisdiction of the Employment and Labour Relations Court (Cause referred under the Employment Act, 2007)

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, "Alexander Oduor Oboya v Catholic Diocese of Nakuru [2020] KEELRC 1733 (KLR)", Case Analysis (2020). Cause No. 521 of 2014. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2020/1733/eng@2020-01-23

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