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ELRCPartially AllowedCause No 2186 of 2015· [2022] KEELRC 226 (KLR)

Michael Kibbe v Uchumi Supermarkets Limited [2022] KEELRC 226 (KLR)

Employment and Labour Relations Court
31 March 2022
SRStella Rutto
2,844 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 Uchumi unfairly sacked its HR Manager, awarding him over Kshs 2.5 million because vague reasons and no hearing don't pass legal muster.

What this practically means

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Executive summary

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The claimant, employed by the respondent as Human Resource Manager from 1st April 2011, was suspended on 16th June 2015 on grounds of gross misconduct and gross negligence and terminated by letter dated 1st September 2015 for 'lack of confidence'. He sued for notice pay, 100 accrued leave days and compensatory damages for unlawful and unfair termination, totalling Kshs 4,683,516/-. The respondent alleged negligence and poor performance, contending the claimant and other managers had brought it near collapse. The Court framed two issues: whether the termination was unfair and unlawful, and whether the claimant was entitled to the reliefs sought. On substantive justification, the Court held the term 'lack of confidence' was too general and unsubstantiated; the particulars pleaded in the defence were never communicated to the claimant, and the Consultant's Report said to reveal his weaknesses was never produced. On procedural fairness, there was no evidence of a show cause letter or disciplinary hearing as required by section 41 of the Employment Act, whose requirements the Court affirmed are mandatory. Relying on Court of Appeal authority, the Court found the termination both substantively and procedurally flawed. It awarded a declaration that the termination was unfair and unlawful, five months' gross salary (Kshs 1,951,465) as compensatory damages, one month's salary in lieu of notice (Kshs 390,293) and accrued leave of Kshs 182,136, totalling Kshs 2,523,894, with interest at court rates from the date of judgment and costs to the claimant. The respondent did not file submissions.

Key legal issues

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01

Substantive justification for termination

Holding

The reason given ('lack of confidence') was too general and unsubstantiated; the respondent failed to prove a valid and fair reason under sections 43 and 45

Reasoning

Section 43(1) places the burden on the employer to prove reasons for termination. The letter of termination cited only 'lack of confidence', which was too vague to disclose any particular act or omission, and the particulars in the defence were never specified to the claimant nor proved. The Consultant's Report alluded to was never produced. The allegations therefore remained bare.

p. 3
02

Procedural fairness under section 41

Holding

The respondent failed to notify the claimant of the allegations or give him a hearing, breaching the mandatory requirements of section 41(1)

Reasoning

Section 41(1) requires an employer to explain the grounds of termination to the employee, allow a fellow employee or representative of choice, and hear representations. There was no evidence of a show cause letter or disciplinary hearing; beyond the suspension letter, no process was demonstrated. These requirements are mandatory regardless of the nature of the alleged transgressions.

p. 4
03

Entitlement to reliefs

Holding

Claimant awarded 5 months' gross salary as compensatory damages, one month's notice pay and prorated accrued leave days

Reasoning

Having found the termination unfair and unlawful, the Court exercised its discretion under section 49 to award five months' gross salary as compensation, one month's salary in lieu of notice, and compensation for untaken accrued leave, as there was no proof the claimant had utilised his 2015 leave days.

p. 4

Legal principles established

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  • An employer bears the burden of proving both valid reason (substantive justification) and fair procedure for termination; vague reasons such as 'lack of confidence' and failure to comply with section 41 render termination unfair

Court orders

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  1. 1.A declaration that the claimant's termination by the respondent was unfair and unlawful
  2. 2.Compensatory damages in the sum of Kshs 1,951,465.00 being equivalent to 5 months gross salary
  3. 3.One month's salary in lieu of notice being the sum of Kshs 390,293.00
  4. 4.Accrued leave days Kshs 182,136.00
  5. 5.Total award of Kshs 2,523,894.00
  6. 6.Interest on the amount at Court rates from the date of Judgment till payment in full
  7. 7.The claimant shall have the costs of the suit

Authorities

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Legislation

  • Employment Actsections 41, 43, 45(2)(a), 45(2)(b), 45(2)(c)
  • Civil Procedure RulesOrder 21 Rule 1
  • Civil Procedure ActSection 1B
  • Constitution of KenyaArticles 159(2)(d) and 48
  • Insolvency Actnot specified

Cases cited (4)

  • Abisalom Ajusa Magomere vs Kenya Nut Company Limited
    (2014) eKLR
  • Chairman Board of Directors (National Water Conservation and Pipeline Corporation) vs Meshack M. Saboke & 2 others
    Nairobi Civil Appeal No. 241 of 2015
  • Ol Pejeta Ranching Limited vs David Wanjau Muhoro
    [2017] eKLR
  • Postal Corporation of Kenya vs Andrew K. Tanui
    [2019] eKLR
Jurisdiction invoked
Article 162(2) of the Constitution (employment and labour relations jurisdiction of the court)

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, "Michael Kibbe v Uchumi Supermarkets Limited [2022] KEELRC 226 (KLR)", Case Analysis (2022). Cause No 2186 of 2015. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/226/eng@2022-03-31

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