Stanley Kyule Mutuku v Swan Carriers Ltd [2022] KEELRC 908 (KLR)
The bottom line
#A Kenyan court ruled that an employer who pays notice pay is treated as the one who ended the job, and must justify the dismissal.
What this practically means
#Executive summary
#Key legal issues
#Whether the claimant's employment was terminated by the respondent
The employment was terminated by the respondent, inferred from the respondent's inclusion of one-month notice pay in the terminal dues computation.
Where parties allege each other terminated employment, the court examined sections 35(1)(c) and 36 of the Employment Act. Notice pay is payable by the party initiating termination. The respondent's letter computing terminal dues included 'One-month notice pay', a paradox if the claimant had resigned. The court therefore inferred the termination emanated from the respondent's end.
Whether the termination was unfair and unlawful
The termination was substantively unfair and unlawful because the respondent advanced no reasons for it.
Sections 43(1) and 45(2) require the employer to prove valid and fair reasons for termination. The respondent did not advance any reasons; it merely calculated dues and asked the claimant to collect them. With no reasons existing, the court could not assess their validity, rendering the termination substantively unfair; procedural fairness need not be examined as that would be academic.
Entitlement to reliefs
The claimant was awarded notice pay, September 2017 salary, unpaid leave days and 3 months' salary as compensatory damages, but denied October 2017 salary and gratuity/service pay.
The court treated the claimant's prayer for 3 months' gross salary as a claim for compensatory damages arising from unlawful termination and awarded it. Notice pay, September salary and leave days were awarded as they featured in the respondent's own computation. The October 2017 salary claim failed as employment ended on 30th September 2017, and service pay failed due to NSSF contributions under section 35(6).
Legal principles established
#- It is the party initiating the termination of employment that is responsible for issuing notice or paying one month's salary in lieu of notice; an employer who pays notice pay is treated as having terminated the employment.
- Under section 47(5) of the Employment Act the employee bears the burden of proving unfair termination or wrongful dismissal, while the employer bears the burden of justifying the grounds of termination.
- A termination by an employer who advances no reasons at all is substantively unfair, since there is nothing upon which the court can assess validity and fairness of the reasons.
Court orders
#- 1.Judgment entered for the claimant against the respondent
- 2.One month's salary in lieu of notice of Kshs 26,775.00
- 3.Salary for September, 2017 of Kshs 26,775.00
- 4.Unpaid leave days of Kshs 7,761.00
- 5.Compensatory damages of Kshs 80,325.00 equivalent to 3 months gross salary
- 6.Total award of Kshs 141,636.00 with interest at court rates from the date of judgment till payment in full
- 7.Each party to bear its own costs
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under the Employment Act (claim for unfair/unlawful termination and terminal dues)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Stanley Kyule Mutuku v Swan Carriers Ltd [2022] KEELRC 908 (KLR)", Case Analysis (2022). Cause No 2508 of 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/908/eng@2022-01-28
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.