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ELRCPartially AllowedCause No 1121 of 2017· [2022] KEELRC 1026 (KLR)

Fredrick Ochieng v Samar Construction Co Limited [2022] KEELRC 1026 (KLR)

Employment and Labour Relations Court of Kenya at Nairobi
21 January 2022
2,958 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 unlawful termination of his employment, which he pleaded as continuous service from June 2014 until 27 June 2016, claiming salary in lieu of notice, service pay, gratuity, compensatory damages and loss of future earnings. The respondent denied an employment relationship, asserting the claimant was a casual labourer engaged intermittently for shuttering works and let go when work volume dropped. Both parties called one witness at the hearing on 9 November 2021; the respondent filed no submissions. The court framed three issues: the nature of the employment relationship, the fairness of the termination, and available reliefs. Holding that the work at the Kileleshwa construction site could not be completed within three months and that the respondent produced no muster roll or casual labour register to show breaks in service, the court found the claimant's casual engagement converted under section 37(1) and (3) of the Employment Act into a monthly contract with full statutory protections. Termination on grounds of low volume of work was characterised as a redundancy requiring substantive justification under section 45(2)(b)(ii) and compliance with section 40(1) conditions; the respondent proved neither. The claim succeeded. The court awarded compensatory damages of three months' gross salary (Kshs 72,000), one month's notice pay (Kshs 24,000), service pay for three years (Kshs 72,000), undisputed outstanding dues (Kshs 21,573) and prorated 2016 leave (Kshs 8,400), totalling Kshs 199,973, with costs and interest. Leave for prior years, and heads such as gratuity and loss of future earnings, were not awarded.

Key legal issues

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01

Nature of the employment relationship

Holding

The claimant's casual engagement was converted by operation of section 37(1) and (3) of the Employment Act into a monthly contract of service entitling him to full statutory protections

Reasoning

The claimant was paid daily or weekly and held a Casual Labour Card, but the undisputed evidence showed continuous work over about two years on a large construction project (Blocks A and B of nine floors each). The work could not reasonably be completed within three months, and the respondent adduced no muster roll or casual labour register to prove a break in service. Section 37(1) therefore deemed the contract one with monthly wages, and section 37(3) conferred full statutory terms.

p. 2
02

Whether termination was unfair and unlawful

Holding

The termination was unfair; it was in substance a redundancy but the respondent proved no valid reasons and complied with none of the section 40(1) conditions

Reasoning

Termination on account of low volume of work falls under the operational requirements of the employer, hence redundancy under section 45(2)(b)(ii). The respondent bore the legal burden under sections 43 and 45 to justify the redundancy and to demonstrate compliance with section 40(1) - notification, selection criteria, notice and severance pay. It tendered no evidence at all, merely asserting that services were no longer required, which was insufficient.

p. 3
03

Reliefs available

Holding

Compensatory damages of three months' gross salary, one month's notice pay, service pay, prorated leave for 2016, outstanding dues and a certificate of service were awarded

Reasoning

Having found unfair termination, the court assessed compensatory damages at three months' gross salary based on length of service and the absence of any reasons advanced by the respondent. Notice pay and service pay under section 35(5) followed. Leave was limited to 2016 since earlier leave could not be presumed carried forward. The undisputed sum of Kshs 21,573 in outstanding dues was awarded, and a certificate of service was due under section 51(1).

p. 4

Legal principles established

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  • A casual employee engaged on work not reasonably expected to be completed within three months, or who works continuously for the equivalent of at least one month, is converted by section 37(1) of the Employment Act to a monthly-paid contract of service
  • The burden of proving valid and fair reasons for termination rests on the employer, and failure to discharge it renders the termination unfair
  • Termination on account of low volume of work amounts to redundancy, requiring compliance with section 40(1) of the Employment Act

Court orders

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  1. 1.Judgment entered in favour of the claimant against the respondent
  2. 2.Compensatory damages of Kshs 72,000/= (3 months gross salary)
  3. 3.One month's salary in lieu of notice of Kshs 24,000/=
  4. 4.Service pay for 3 years of Kshs 72,000/=
  5. 5.Outstanding dues of Kshs 21,573/=
  6. 6.Untaken leave days (10.5 days x Kshs 800) of Kshs 8,400/=
  7. 7.Total award of Kshs 199,973/=
  8. 8.Costs of the suit to the claimant
  9. 9.Interest on the total award at court rates from the date of judgment till payment in full

Authorities

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Legislation

  • Employment Actsection 2
  • Employment Actsections 37(1), 37(3), 37(4)
  • Employment Actsection 35(1)(c)
  • Employment Actsection 35(5)
  • Employment Actsection 40(1)
  • Employment Actsections 43(1), 45(2), 45(2)(b)(ii)
  • Employment Actsection 51(1)
  • Civil Procedure RulesOrder 21 Rule 1
  • Civil Procedure ActSection 1B
  • Constitution of KenyaArticle 159(2)(d)
  • Constitution of KenyaArticle 48

Cases cited (5)

  • Fredrick Ouma Otieno vs Falcon Signs Limited
    (2020) eKLR
  • Kenya Planation & Agricultural Workers Union vs Del Monte Kenya Limited
    (2016) eKLR
  • Kenya Broadcasting Corporation vs Geoffrey Wakio
    (2019) eKLR
  • Nanyuki Water & Sewage Company Limited vs. Benson Mwiti Ntiritu & 4 others
    [2018] eKLR
  • Rashid Odhiambo Allogoh & 245 Others vs Haco Industries Limited
    [2015] eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act (dispute over terms and termination of employment)

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, "Fredrick Ochieng v Samar Construction Co Limited [2022] KEELRC 1026 (KLR)", Case Analysis (2022). Cause No 1121 of 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/1026/eng@2022-01-21

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