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ELRCPartially AllowedCause No 320 of 2017· [2021] KEELRC 343 (KLR)

Wycliffe Ochieng Olale v Sight & Sound Limited [2021] KEELRC 343 (KLR)

Employment and Labour Relations Court
22 November 2021
NMNzioki Wa Makau
2,508 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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What this practically means

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Executive summary

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The Claimant sued the Respondent alleging he was employed from 2005 as General Manager in the Finance and Administration Office, earning approximately Kshs. 118,689/- monthly, and that on 21st December 2016 his contract was terminated on malicious and unfounded claims of gross misconduct without a hearing. He sought reinstatement or, in the alternative, damages, outstanding dues and 12 months' compensation. The Respondent denied the claims, asserting the Claimant breached his fiduciary duties by running a competing business, Galstrack Enterprises Limited, poaching clients, and being implicated in pilferage reported to Parklands Police Station; it counterclaimed for an account of profits and damages. The Respondent, though served, did not attend the hearing on 4th October 2021, and its counterclaim was dismissed for want of prosecution. The Claimant testified and submitted that the termination violated Section 41 of the Employment Act and Articles 47 and 50 of the Constitution, relying on authorities on substantive justification and procedural fairness. The court held that although the Respondent had cause to terminate - the Claimant being a director of a competing company - it failed to accord him any fair procedure under Section 41, rendering the dismissal unlawful and unprocedural. However, because the Claimant sought in submissions far more than he had pleaded, recovery was limited to a declaration of unlawful termination, one month's salary as compensation (Kshs. 116,989/-), and costs of the suit based on the award. The wider reliefs of 12 months' compensation, notice pay and leave dues were refused.

Key legal issues

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01

Whether the Claimant's termination was unlawful, unprocedural and unfair

Holding

Although the Respondent had cause to terminate (the Claimant was a director of a competing business), the termination was unlawful and unprocedural because Section 41 safeguards (explanation, hearing, consideration of representations) were not accorded

Reasoning

The court accepted the Respondent had reason to terminate given the Claimant's directorship of Galstrack Enterprises Limited, a competing business registered in 2015. However, a valid reason alone is insufficient: the employer must comply with Section 41 of the Employment Act, which mandatorily requires explanation of grounds, a hearing, and consideration of representations. The Claimant was denied any hearing or notice, so the dismissal was procedurally unfair and attracted compensation.

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02

Whether the Claimant was entitled to the reliefs sought

Holding

Partially - only one month's salary as compensation plus costs; the wider reliefs were refused as exceeding the pleadings

Reasoning

The court found the dismissal unlawful and unprocedural and sanctioned the Respondent with compensation. However, the Claimant in submissions claimed 12 months' salary, notice pay and leave dues which he had not pleaded; the court confined recovery to the pleaded claim, awarding one month's salary. The counterclaim failed for want of prosecution and proof of loss.

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Legal principles established

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  • Where an employer terminates for misconduct, the safeguards of Section 41 of the Employment Act must be adhered to; failure attracts an award of compensation for unlawful and unprocedural dismissal
  • Fair termination requires both substantive justification and procedural fairness

Court orders

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  1. 1.A declaration that the termination of the Claimant's contract was unlawful and unprocedural
  2. 2.Compensation for the unlawful dismissal from employment of 1 month's salary being Kshs. 116,989/-
  3. 3.Costs of the suit based on the award

Authorities

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Legislation

  • Employment ActSection 41
  • Employment ActSection 42(1)
  • Employment ActSection 43(1)
  • Employment ActSection 44(3) and (4)
  • Employment ActSection 45(4)(b)
  • Employment ActSection 49
  • Constitution of KenyaArticle 47
  • Constitution of KenyaArticle 50
  • The Labour Relations ActNot specified

Cases cited (5)

  • National Bank of Kenya v Anthony Njue John
    [2018] eKLR
  • Walter Ogal Anuro v Teachers Service Commission
    [2013] eKLR
  • Anthony Mkala Chitavi v Malindi Water & Sewerage Company Limited
    [2013] eKLR
  • George Onyango Akuti v G4S Security Services Kenya Ltd
    [2013] eKLR
  • Abisalom Ajusa Magomere vs Kenya Nut Company Limited
    [2014] eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act 2007 (as invoked by the parties' pleadings and submissions)

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, "Wycliffe Ochieng Olale v Sight & Sound Limited [2021] KEELRC 343 (KLR)", Case Analysis (2021). Cause No 320 of 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2021/343/eng@2021-11-22

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