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ELRCPartially AllowedCause No. 109 of 2020· [2021] KEELRC 12 (KLR)

Nick Musili Musyoka v Dac Avition (E.A) Limited [2021] KEELRC 12 (KLR)

Employment and Labour Relations Court of Kenya
16 December 2021
2,758 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan pilot won unpaid salary, allowances and leave worth millions, but lost his constructive dismissal claim because he never actually resigned in writing.

What this practically means

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Executive summary

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The claimant, a pilot employed by the respondent aviation company as a First Officer in 2014 and promoted to Captain in 2018, sued for unpaid salary, cash allowances, leave, house and medical allowances, notice pay and 12 months' compensation for unfair constructive dismissal, plus an order for a certificate of service and payment of USD dues in Kenya Shillings. The respondent entered appearance but filed no defence despite several extensions and service of hearing notices; the claim proceeded undefended. The court found the respondent breached the contract by failing to pay salaries from May 2019, holding that prolonged non-payment of salaries is an unfair labour practice prohibited under Article 41 of the Constitution and subjects the employee to inhuman and degrading treatment. The uncontested dues - unpaid salary of Ksh.459,431.36, cash allowances of $21,360 and 84 untaken leave days valued at $7,476 plus Ksh.734,520.64 - were awarded. However, the claim for house allowances failed because housing was not a contract term and the claimant was not a protected employee under the Wage Orders; the refund of medical insurance costs failed because the benefit was non-monetary. The constructive dismissal claim failed because although non-payment gave the claimant good cause, he did not tender a resignation letter; the advocates' demand letter was insufficient, and the court found he abandoned his employment, defeating notice pay and compensation. Judgment was entered for the awarded dues, payable within 30 days with interest thereafter at court rates, in Kenya Shillings, with a certificate of service to issue and costs to the claimant.

Key legal issues

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01

Non-payment of salary and allowances

Holding

The salary from November to December 2019 and cash allowances from May to December 2019 were due and uncontested and were awarded in full

Reasoning

Under section 18 of the Employment Act wages are due at the end of each month for employees employed for a period exceeding one month. The respondent admitted non-payment through memos and letters proposing payment plans, and no defence was filed. The court found the dues for time worked payable in full.

p. 3
02

Constructive dismissal

Holding

The claim of constructive dismissal failed; the claimant was found to have abandoned employment and cannot claim notice pay or compensation

Reasoning

Applying the Coca Cola test, the employer's non-payment gave the claimant good cause to resign, but the claimant never tendered a letter of resignation; the advocates' demand letter was insufficient. Failure to resign following the breach constitutes abandonment, which amounts to gross misconduct without good cause in law.

p. 4
03

House allowances

Holding

The claim for house allowances from 2014 to 2019 was rejected as housing was not a contract term and the claimant was not a protected employee under the Wage Orders

Reasoning

Clause 5.4 of the contract only provided for housing or payment of an allowance where the claimant travelled on assignment. Since the claimant did not earn a minimum wage regulated under the Wage Orders, the statutory entitlement to house allowance did not apply, so the claim lacked merit.

p. 3
04

Medical allowance refund

Holding

The refund of Ksh.18,845 for alternative medical insurance was refused because the contractual medical benefit was non-monetary

Reasoning

The contract provided medical insurance as a non-monetary benefit. Where it was not provided, the claimant's remedy was to pursue the dispute resolution mechanism, not to self-insure and claim a refund. He also did not show he required medical cover and used personal funds for treatment.

p. 3
05

Leave days

Holding

84 days of untaken leave were awarded at $7,476 plus Ksh.734,520.64 as due under the contract and section 28 of the Employment Act

Reasoning

Leave is a contractual and statutory entitlement under section 28 of the Employment Act. The respondent did not contest the tabulation of 84 days owed, and the court found the claim justified and awarded it as claimed.

p. 3
06

Mode of payment and certificate of service

Holding

USD dues may be converted and paid in Kenya Shillings under section 17 of the Employment Act, and a certificate of service must issue under section 51

Reasoning

The court found the order seeking payment of terminal dues in Kenya Shillings lawful and justified under section 17 of the Act. The certificate of service is a statutory entitlement for the duration of employment under section 51 and was ordered to issue.

p. 4

Legal principles established

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  • Subjecting an employee to prolonged periods of non-payment of salary amounts to an unfair labour practice prohibited under Article 41 of the Constitution
  • Constructive dismissal requires a repudiatory breach going to the root of the employment contract, proved by the employee on an objective test with a causal link to the resignation
  • A letter of demand from advocates is not commensurate to a letter of resignation in a constructive dismissal claim

Court orders

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  1. 1.Unpaid basic salary from November to December 2019 of Ksh.459,431.36
  2. 2.Unpaid cash allowances from May to December 2019 of $21,360
  3. 3.84 leave days not taken: $7,476 plus Ksh.734,520.64
  4. 4.Dues in United States Dollars to be converted and paid in Kenya Shillings
  5. 5.Certificate of service to be issued pursuant to section 51 of the Employment Act, 2007
  6. 6.Dues payable within 30 days, thereafter with interest at court rates from date due until paid in full
  7. 7.Costs of the suit to the claimant
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under Article 162(2) of the Constitution over employment and labour relations disputes

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, "Nick Musili Musyoka v Dac Avition (E.A) Limited [2021] KEELRC 12 (KLR)", Case Analysis (2021). Cause No. 109 of 2020. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2021/12/eng@2021-12-16

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