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ELRCPartially AllowedCause No 852 of 2017· [2021] KEELRC 3 (KLR)

Omusamia v Upperhill Springs Restaurant (Cause 852 of 2017) [2021] KEELRC 3 (KLR)

Employment and Labour Relations Court of Kenya
5 October 2021
OKOcharo Kebira
4,961 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 cook was an employee, not a contractor, and awarded him pay because his dismissal lacked valid reasons and a fair hearing.

What this practically means

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Executive summary

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This was a first-instance employment claim before the Employment and Labour Relations Court at Nairobi, decided by Ocharo Kebira, J on 5th October 2021. The claimant, employed as a cook, alleged that his employment was terminated by a termination letter and a summary dismissal letter both dated 28th September 2016 without notice, valid reasons or a hearing, and sought notice pay, unpaid leave and 12 months' gross salary as compensation. The respondent admitted the work relationship but characterized it as a contract for service (contractor-client), denying the authenticity of the claimant's documents and contending that no employment reliefs were available. The court framed five issues: the nature of the relationship, whether there was a dismissal, its substantive and procedural fairness, the availability of reliefs, and costs. Applying the multi-factorial approach and the conventional tests for employment status, the court found the respondent's independent-contractor assertion to be a bare, undocumented assertion that failed the burden under sections 107 and 109 of the Evidence Act, while the claimant's letterhead documents, gate register and NSSF deductions proved employment. The dismissal was found both procedurally and substantively unfair: section 41 procedure was breached and the respondent led no evidence on reasons, triggering the default deeming provision of section 43. Judgment was entered for the claimant with declarations on the employment relationship and unfair dismissal, one month's notice pay (Kshs 17,000), unpaid leave (Kshs 11,900), nine months' salary compensation (Kshs 153,000) under section 49(1)(c), costs, and interest from the date of filing suit.

Key legal issues

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01

Whether the relationship between the claimant and the respondent was a contract of service (employment) or a contract for service (independent contractor)

Holding

The relationship was one of employer and employee under a contract of service; the respondent's assertion of a contractor-client relationship was unsupported by any evidence

Reasoning

The court surveyed the control, fourfold and integration tests and the multi-factorial approach in Ontario v Sagaz Industries. The respondent, despite pleading a contractor-client relationship, produced no contract, invoices or payment vouchers, failing the burden under sections 107 and 109 of the Evidence Act. The claimant produced an appointment letter, salary increment letter, termination and dismissal letters on the respondent's letterhead and stamp, undisputed gate register attendance, and NSSF deductions. The claimant discharged the burden of proving employment.

p. 12
02

Whether there was a dismissal of the claimant

Holding

Yes, there was a dismissal, evidenced by a termination letter and a summary dismissal letter dated 28th September 2016 which the respondent failed to successfully challenge

Reasoning

The claimant proved the fact of dismissal as required by section 45(5) of the Employment Act. The respondent's witness merely denied the authenticity of the documents without demonstrating why, producing no file copies for comparison. The letters therefore stood unchallenged and established the dismissal.

p. 12
03

Whether the dismissal was substantively and procedurally fair

Holding

The dismissal was neither procedurally nor substantively fair; section 41 procedure was breached and section 43 reasons were not proved

Reasoning

Section 41 requires an employer to explain reasons and hear representations before termination. The two letters of 28th September 2016 showed no show-cause or hearing. The respondent, wedded to its contractor-client position, adduced no evidence on procedure or substantive reasons. The court invoked the default deeming provision of section 43 and found unfairness under section 45.

p. 13
04

Which reliefs were available to the claimant

Holding

One month's salary in lieu of notice (Kshs 17,000), unpaid leave (Kshs 11,900) and compensation of nine months' gross salary (Kshs 153,000) under section 49(1)(c) were awarded

Reasoning

No notice preceded the dismissal, so notice pay was due. The leave claim was not specifically challenged by the respondent. Compensation was warranted because the respondent tried to deny the employment relationship and complied with neither procedural nor substantive fairness; 12 months sought was reduced to 9 months.

p. 13

Legal principles established

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  • The protections and remedies under the labour relations statutes are available only to employees; independent contractors do not enjoy statutory protection, making characterization of the relationship imperative
  • A party asserting that a worker is an independent contractor bears the burden of proving that characterization; a bare assertion without documentary evidence does not discharge it
  • Where an employer fails to prove the reasons for termination, the termination is deemed unfair under section 45 of the Employment Act
  • A denial of documents by a witness must be substantiated; a mere assertion that documents are not the employer's cannot stand against documents on the employer's letterhead and stamped with its stamp

Court orders

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  1. 1.A declaration that the relationship between the respondent and the claimant was that of employer and employee based on a contract of service
  2. 2.A declaration that the dismissal of the claimant from employment was neither substantively nor procedurally fair
  3. 3.One month's salary in lieu of notice – Kshs 17,000
  4. 4.Unpaid leave – Kshs 11,900
  5. 5.Compensation pursuant to section 49(1)(c) of the Employment Act, Kshs 153,000 (nine months' gross salary)
  6. 6.Costs of the suit to the claimant
  7. 7.Interest on the monetary awards at court rates from the date of filing suit

Authorities

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Legislation

  • Employment Act, 2007section 2 (definitions of employee and contract of service)
  • Employment Act, 2007section 28 (annual leave)
  • Employment Act, 2007section 34 (notice)
  • Employment Act, 2007section 41 (procedure before termination)
  • Employment Act, 2007section 42(1)
  • Employment Act, 2007section 43 (proof of reasons for termination)
  • Employment Act, 2007section 44(3) and (4) (summary dismissal)
  • Employment Act, 2007section 45 (unfair termination, including 45(2)(c) and 45(5))
  • Employment Act, 2007section 49(1)(c) (compensation)
  • Evidence Act, Cap 80 Laws of Kenyasections 107 and 109 (burden of proof)

Cases cited (13)

  • Ready Mixed Concrete (South East) Ltd v Minister of Pensions and National Insurance
  • Kenya Hotel and Allied Workers Union v Alfajiri Villas
  • Paul Ochieng Agola v Gateway Marine Services Limited
  • Maurice Odour Okech v The Chequered Flag Limited
  • Evans Kamadi Misango v Barclays Bank of Kenya Limited
  • Donald Odeke v Fidelity Security Limited
  • Kenya Plantations & Agricultural Workers Union v Sotik Highlands Tea Estate Limited
  • Joseph Nyaga v United Millers Limited
    Cause No 267 of 2015 [Nakuru]
  • Gilbert Sule Otieno v Seventh Day Adventist Church (East Africa) Limited
  • Ontario v Sagaz Industries Canada Inc.
  • Stevenson Jordon and Harrison Limited v McDonald and Evans
    (1952)
  • Aristide Maraga Nyangace v Lavington Security Limited
    ELRC Cause No 94 of 2016
  • Lydia Moraa Obara v Tusker Mattresses Limited
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 (consequential provisions of Article 162(2) of the Constitution); not expressly stated in judgment

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (24)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Omusamia v Upperhill Springs Restaurant (Cause 852 of 2017) [2021] KEELRC 3 (KLR)", Case Analysis (2021). Cause No 852 of 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2021/3/eng@2021-10-05

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