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ELRCPartially AllowedCause No 1036 of 2018· [2022] KEELRC 906 (KLR)

Rosslyn Khadenyi Madere v Naisula Holdings Limited t/a Naisula School & Cecilia Muchemi (Cause 1036 of 2018) (Employment and Labour) [2022] KEELRC 906 (KLR)

Employment and Labour Relations Court
2 February 2022
5,176 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~21 min to read original · ~4 min brief

The bottom line

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What this practically means

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Executive summary

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The Claimant, a teacher engaged by the 1st Respondent under a written contract dated 21st June 2016, sued for wrongful and unlawful termination of her employment on 14th February 2018 on account of redundancy, claiming 12 months' salary as compensation, three months' pay in lieu of notice, general damages, a certificate of service, costs and interest. The Respondents denied the claim, contending the termination was a contractual termination on three months' notice under Clause 8 of the terms and conditions of service, preceded by a performance warning dated 4th September 2017. The Court first found, on the admitted absence of privity of contract, that the 2nd Respondent was improperly joined. On termination, the Court held that although parties are bound by their contract, employment law in Kenya is predominantly statutory, and the Employment Act requires termination to be substantively and procedurally fair irrespective of the contractual mode invoked. Since poor performance was alleged, Section 41 required a hearing; no appraisal, show-cause or hearing followed the September 2017 letter, whose three-month window had lapsed. The termination was summary, unreasoned and condemned the Claimant unheard, failing Sections 41, 43, 45 and 47(5). On reliefs, the Court awarded two months' salary (Kshs.170,000) as compensation under Section 49(1)(c), Kshs.60,000 as the shortfall in notice pay computed on full salary including house allowance (housing being a statutory right), and a certificate of service, but declined general damages as unavailable for breach of contract post-Employment Act 2007. Judgment was entered for Kshs.230,000 with costs and interest at court rates.

Key legal issues

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01

Whether termination invoking a contractual notice clause can escape the unfair termination regime

Holding

No; termination must be substantively and procedurally fair regardless of the contractual mode invoked

Reasoning

The Respondent argued it merely exercised a contractual right to terminate on three months' notice without giving reasons. The Court held that the Employment Act 2007 heralded a statutory regime of fairness; contract terms bind parties but employment law is for the most part statutory, and Sections 41, 43, 45 and 47(5) apply to any termination howsoever labelled.

p. 5
02

Whether the termination was procedurally fair where poor performance was alleged

Holding

It was not; the Claimant had a right to be heard before termination on performance allegations

Reasoning

The Respondent adduced no performance management framework, appraisal tool or evidence of any review after the 4th September 2017 letter. The three-month notice period in that letter lapsed and no further evaluation occurred before termination. No show-cause letter or hearing was given, condemning the Claimant unheard contrary to Section 41.

p. 6
03

Whether the Respondent justified the reason for termination

Holding

It did not; the alleged unsatisfactory performance was not proved

Reasoning

Under Sections 43 and 45(2) the employer bears the burden of proving a valid and fair reason. RW1 confirmed the termination letter gave no reason and no appraisal followed the September 2017 review letter. The Court found it unclear how the decision to terminate was reached and held the termination failed the statutory threshold.

p. 6
04

Computation of pay in lieu of notice

Holding

Pay in lieu of notice is the full monthly salary including house allowance, not basic pay

Reasoning

The Respondent computed three months' notice pay on basic salary only, excluding house allowance. The Court held housing is a statutory right under Section 31 and that the contract clauses referred to 'pay in lieu of notice' without restricting it to basic pay; the shortfall of Kshs.60,000 was awarded.

p. 7
05

Whether the 2nd Respondent was properly joined

Holding

No; there was no privity of contract between the Claimant and the 2nd Respondent

Reasoning

The Claimant confirmed on cross-examination that her contract was with the 1st Respondent, Naisula Holdings Limited. Relying on Dunlop v Selfridge, the Court found the 2nd Respondent improperly joined as the Claimant had no contract of employment with it.

p. 4

Legal principles established

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  • It does not matter how a termination was done; where a court finds it unfair or wrongful, Section 49 reliefs apply
  • Termination of employment must be substantively and procedurally fair irrespective of the mode of termination invoked by the employer
  • Pay in lieu of notice is the employee's full monthly salary including all allowances, and housing is a statutory right

Court orders

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  1. 1.Judgment entered for the Claimant against the Respondent for Kshs.230,000/- with costs
  2. 2.Interest at Court rates from the date of judgment till payment in full
  3. 3.Compensation equivalent to two months' salary (Kshs.170,000/-) under Section 49(1)(c) of the Employment Act
  4. 4.Three months' pay in lieu of notice computed on full monthly salary, less Kshs.171,337.74 already paid, leaving Kshs.60,000/- outstanding awarded
  5. 5.Certificate of service to be issued to the Claimant
  6. 6.2nd Respondent found improperly joined in the proceedings

Authorities

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Legislation

  • Employment ActSections 2, 31, 35(1)(c) and (2), 41, 43, 45(1), 45(2), 47(5), 49(1)(c), 49(4)
  • Constitution of KenyaArticle 159(2)(d), Article 48
  • Civil Procedure RulesOrder 21 Rule 1
  • Civil Procedure ActSection 1B
  • Interpretation & General Provisions ActSection 3

Cases cited (17)

  • Kenfreight (EA) Limited v Benson K. Nguti
    [2019] eKLR
  • Kenfreight (EA) Limited v Benson K. Nguti
    [2016] eKLR
  • GMV v Bank of Africa Limited
    [2013] eKLR
  • Savings and Loan (K) Limited v Kanyenje Karangaita Gakombe & Another
    [2015] eKLR
  • Dunlop Pnuematic Tyre Co. Ltd v Selfridge and Com Ltd
    [1915] AC 847
  • Hassan Zebeidi v Patrick Mwangangi Kibaiya & another
    [2014] eKLR
  • National Bank of Kenya v Pipeplastic Samkolit (K) Ltd and another
    [2002] EA 503
  • Kenya Revenue Authority v Menginya Salim Murgani
    [2010] eKLR
  • Consolata Anyango Ouma v Southern Nyanza Sugar Company Limited
    [2015] eKLR
  • Darn Otieno v Stanbic Bank Kenya Limited
    [2012] eKLR
  • Pius Machafu Isindu v Lavington Security Guards Limited
    [2017] eKLR
  • Naima Khamis v Oxford University Press (E.A) Ltd
    [2017] eKLR
  • Standard Group Limited v Jenny Luesby
    [2018] eKLR
  • CMC Aviation Limited v Mohammed Noor
    [2015] eKLR
  • Agnes Yahuma Digo v PJ. Petroleum Equipment Ltd
    [2013] eKLR
  • Jane Samba Mukala v Ol Tukai Lodge Ltd
    [2013] eKLR
  • Alphonse Maghanga Mwachanya v Operation 680 Limited
    [2013] eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 (labour dispute first instance)

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (1)

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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, "Rosslyn Khadenyi Madere v Naisula Holdings Limited t/a Naisula School & Cecilia Muchemi (Cause 1036 of 2018)  (Employment and Labour) [2022] KEELRC 906 (KLR)", Case Analysis (2022). Cause No 1036 of 2018. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/906/eng@2022-02-02

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