Oyoo v Prideinn Hotels & Investments Limited (Cause 1029 of 2016) [2022] KEELRC 1319 (KLR)
The bottom line
#A Kenyan employer can fire for poor performance, but skipping the proper hearing process still makes the dismissal unfair and costly.
What this practically means
#Executive summary
#Key legal issues
#Whether the Claimant's contract converted to permanent terms under Section 37 of the Employment Act
No; the signed contract was a one-year performance-based renewable contract and Section 37 applies only to conversion of casual employees
The contract dated 3rd March 2013 was signed by the Claimant and provided for a one-year renewable performance-based engagement. The submission that service became permanent under Section 37 was rejected because that section deals exclusively with conversion of casual employees into permanent terms, which was not this Claimant's situation.
Whether there was a valid and fair reason for termination (substantive fairness)
Yes; the respondent proved valid and fair reasons relating to the Claimant's poor performance and supervisory failures
The termination letter cited the horrible state of the branch under the Claimant's supervision and his slowness to respond. An audit found unattended issues, and a notice to show cause had issued in 2014 which the Claimant responded to. Applying Section 43(2), the employer genuinely believed the reasons existed. The Claimant also accepted promotion without indicating inability to perform.
Whether the termination was procedurally fair under Section 41
No; the termination was procedurally flawed and thus unfair because the Claimant was not notified of fresh allegations nor given a hearing
Apart from the 2014 notice to show cause, no notice was issued about the new complaints or the audit outcome. The alleged disciplinary sitting of 4th July 2015 had no minutes, no evidence of invitation, and no indication the Claimant was told of the right to be accompanied. RWI's testimony on the meeting was unsubstantiated. Non-compliance with Section 41 rendered the termination unfair.
What reliefs flow from the unfair termination
Declaration issued; compensation fixed at 3 months' salary under Section 49(1)(c) read with Section 49(4); certificate of service due under Section 51(1)
The primary remedy for procedurally unfair termination is compensation capped at 12 months' salary, exercised discretionarily having regard to Section 49(4). The court considered the short tenure of about 2 years 7 months, the absence of an appeal, and the 2014 notice and response, concluding that 3 months' salary was fair. A certificate of service is a statutory entitlement.
Legal principles established
#- For a termination to be fair it must be both substantively justifiable and procedurally fair
- Section 41 procedural steps are mandatory
- The employer bears the burden of proving valid reason and fair procedure
Court orders
#- 1.Declaration that termination of the Claimant's employment was unfair and unlawful
- 2.Equivalent of 3 months' salary as compensation under Section 49(1)(c) of the Employment Act
- 3.Costs of the suit to the Claimant
- 4.Interest at court rates from the date of judgment until payment in full
- 5.Certificate of service to be issued to the Claimant
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 (Employment and Labour Relations Court Act)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Oyoo v Prideinn Hotels & Investments Limited (Cause 1029 of 2016) [2022] KEELRC 1319 (KLR)", Case Analysis (2022). Cause No 1029 of 2016. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/1319/eng@2022-07-21
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.