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ELRCPartially AllowedNot stated in the judgment· [2022] KEELRC 1246 (KLR)

Wambua & 15 others v W.E Tilley (Muthaiga) Limited (Cause 441 of 2016) [2022] KEELRC 1246 (KLR)

Employment and Labour Relations Court
19 July 2022
4,965 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
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The bottom line

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A Kenyan court ruled that locking workers out and failing to pay them amounted to constructive dismissal, awarding them compensation, notice pay, and costs.

What this practically means

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Executive summary

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Sixteen claimants, drivers and a general operator/machine attendant, sued the respondent alleging unpaid November 2015 salaries, denial of access to the premises from December 7, 2015, and constructive/unlawful termination following a High Court freezing order in HCCC No. 522 of 2015 arising from the Imperial Bank dispute. They sought a declaration of unfair termination, certificates of service, salaries for December and January, notice pay, unpaid leave, damages for constructive dismissal, service pay, welfare, NSSF/NHIF remittances, costs and interest. The respondent denied termination, asserting the court order paralysed its operations, that the claimants absconded, and that all statutory dues were remitted. The court framed two issues: whether the claimants were constructively dismissed or declared redundant, and their entitlement to reliefs. Applying Western Excavating v Sharp and Coca Cola v Ligaga (contractual test), it held that closure of the premises, non-payment of salaries and the employer's silence amounted to repudiatory breach entitling the claimants to treat themselves as constructively dismissed. No redundancy was declared, and the frustration defence failed because the respondent never followed the statutory redundancy process under section 40. The court declined salaries for December 2015 and January 2016 (no work done after December 7, 2015) but awarded 7 days' December salary and one month's pay in lieu of notice. Graduated compensation of 4 to 7 months' gross salary was awarded by length of service under section 49(1)(c). Claims for unpaid leave, service pay, welfare and NSSF/NHIF contributions failed for want of proof. Certificates of service, costs and interest were also awarded.

Key legal issues

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01

Whether the Claimants were constructively dismissed or declared redundant

Holding

The Claimants were constructively dismissed; they were not declared redundant and the frustration argument failed because the respondent did not follow the redundancy process

Reasoning

Applying the contractual test in Coca Cola v Ligaga and Western Excavating v Sharp, the closure of the gates after December 7, 2015, non-payment of salaries and the employer's silence constituted repudiatory breach going to the root of the contract. No redundancy was declared; even if frustration occurred, the respondent should have notified employees and the Labour Officer and complied with section 40. The respondent did not apply its mind to the consequences of its conduct.

p. 9
02

Entitlement to salary for December 2015 and January 2016

Holding

Declined for periods after December 7, 2015; salary awarded only for the 7 days worked in December

Reasoning

CW1 confirmed on cross-examination that none of the Claimants worked after December 7, 2015. Since no services were rendered thereafter, no salary was payable for December 2015 beyond the 7 days or for January 2016.

p. 9
03

One month's salary in lieu of notice

Holding

Awarded as the requisite notice under section 35 was not given

Reasoning

The respondent failed to give the statutory notice of termination required by section 35 of the Employment Act, so compensation in lieu is payable under section 36.

p. 10
04

Compensation for constructive dismissal

Holding

Awarded under section 49(1)(c) on a graduated basis of 4 to 7 months' gross salary depending on length of service

Reasoning

The court considered duration of employment, the Claimants' willingness to continue working, absence of disciplinary issues, and the destabilising court order in HCCC No. 522 of 2015. Employment dates pleaded were taken as proved since the respondent produced no contradicting evidence.

p. 10
05

Certificate of service

Holding

A statutory entitlement under section 51(1) of the Employment Act; to be issued within 30 days

Reasoning

Although the respondent claimed it had dispatched certificates of service to its advocates, the Claimants had not received them. Section 51(1) makes issuance a statutory entitlement.

p. 11

Legal principles established

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  • Closure of premises coupled with non-payment of salaries and employer silence amounts to a repudiatory breach entitling employees to treat themselves as constructively dismissed
  • The employer bears a heavy burden to justify termination of employment

Court orders

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  1. 1.Salary for 7 days worked in December 2015
  2. 2.Compensation: 1st, 2nd, 3rd, 9th and 14th Claimants awarded equivalent of 7 months' salary; 4th, 5th, 8th and 13th Claimants equivalent of 6 months' salary; 10th, 11th, 12th and 16th Claimants equivalent of 5 months' salary; 6th, 7th and 15th equivalent of 4 months' salary
  3. 3.Certificate of service to be issued within 30 days of the judgment
  4. 4.Costs of the suit to the Claimants
  5. 5.Interest at court rates from the date of judgment till payment in full

Authorities

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Legislation

  • Employment ActSection 51(1)
  • Employment Act, 2007Section 47(5)
  • Employment Act, 2007Section 2 (definition of redundancy)
  • Employment Act, 2007Section 40
  • Employment Act, 2007Section 35(6)
  • Employment Act, 2007Section 35
  • Employment Act, 2007Section 36
  • Employment ActSection 49(1)(c)
  • Civil Procedure RulesOrder 21 Rule 1
  • Constitution of KenyaArticle 159(2)(d)
  • Constitution of KenyaArticle 48
  • Civil Procedure Act (Chapter 21, Laws of Kenya)Section 1B

Cases cited (16)

  • Western Excavating (ECC) Ltd V Sharp
    (1978) Q.B 761
  • Coca Cola East & Central Africa Ltd V Maria Kagai Ligaga
    (2015) eKLR
  • Barclays Bank of Kenya Ltd V Gladys Muthoni & 20 others
    (2018) eKLR
  • Joseph M. Kivilu V Kenya National Examination Council
    (2021) eKLR
  • Angela Wokabi V Tribe Hotel Ltd
    ELRC Cause No. 1712 of 2014
  • Kipkebe Ltd V Peterson Ondieki Tai
    (2016) eKLR
  • Omar Ndaro Zuma V Modern Coast Express
    (2019) eKLR
  • Sabtyabrata Ghose V Mugeneeram Bangur & Co.
    1954 SCR 310
  • Omwenga Joseph Chanai & 26 others V Jack and Jill Supermarket Ltd
    (2019) eKLR
  • Joshua Nyagol Onyango & 4 others V Relief Missions Logistics Ltd
    (2017) eKLR
  • Paul Musina Chiedo V Ready Consultancy Co. Ltd
    (2020) eKLR
  • Evans Sagwa Rumura V Insignia Kenya Limited
    (2022) eKLR
  • Peter Ngunjiri Kanuki V Management of Magumano Secondary School
    (2022) eKLR
  • Rhoda Nyatoka Isena V Coptic Hospital
    (2021) eKLR
  • Hassanath Wanjiku V Vanela House of Coffees
    (2018) eKLR
  • Alice Wambui Adwordy V Casa Dei Bambini Ltd
    (2022) eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 (first-instance claim)

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, "Wambua & 15 others v W.E Tilley (Muthaiga) Limited (Cause 441 of 2016) [2022] KEELRC 1246 (KLR)", Case Analysis (2022). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/1246/eng@2022-07-19

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