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ELRCPartially AllowedCause No E002 of 2021· [2022] KEELRC 1441 (KLR)

Mirikau v Exon Investments Limited (Cause E002 of 2021) [2022] KEELRC 1441 (KLR)

Employment and Labour Relations Court
26 May 2022
3,636 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan court ruled a mechanic's dismissal had a valid reason but was procedurally unfair, awarding him over Kshs. 122,000.

What this practically means

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Executive summary

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The Claimant, formerly a mechanic manager at the Respondent's Bungoma base, sued after summary dismissal in December 2018, seeking a declaration that his termination was unlawful and unfair, terminal benefits, compensatory damages (including for a work injury), interest and costs. The Respondent maintained he deserted duty after declining a transfer to Mombasa, and that he was summarily dismissed on December 17, 2018. The court found the reason for dismissal - absenteeism/desertion - proved and valid, accepting the Respondent's evidence on service of the transfer letter and the stamped dismissal letter. However, it held the termination procedurally unfair under Section 41(2) of the Employment Act: no show cause process was demonstrated and no 28-day notice under Section 35(1)(c) was issued, entitling the Claimant to notice pay and one month's gross salary as compensation. On the work injury claim, the court, following decisions of Makau J and Rika J, held it lacks original jurisdiction over WIBA claims and referred that claim to the Director of WIBA. The Claimant was found not entitled to service pay (NSSF contributions) and failed to prove overtime; leave pay was limited by Section 90 to statutory leave for the year of termination. Wrongful deductions of Kshs. 28,578/- were proved after the employer failed to justify them. Judgment was entered for the Claimant totalling Kshs. 122,844.30/- subject to statutory deductions, with a Certificate of Service ordered, the Respondent to pay costs, and interest at court rates from the date of judgment.

Key legal issues

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01

Validity of the reason for summary dismissal

Holding

The reason of absenteeism/desertion of duty was proved and valid, the court finding service of the transfer letter credible

Reasoning

The court accepted the Respondent's witness as credible on personal delivery of the transfer letter and noted the Claimant's own testimony that Japheth Ouma reported as a mechanic in November 2018, matching his stated replacement. The dismissal letter of December 17, 2018 citing absenteeism was stamped at the Mombasa County Labour Office. The Claimant was found not candid in his evidence, so desertion was established as a valid reason under Section 44(4)(a).

p. 4
02

Procedural fairness of the termination

Holding

The termination was procedurally unfair despite the valid reason

Reasoning

Section 41(2) required the employer to hear and consider representations before summary dismissal for misconduct. The reliance letter referred to a show cause letter that was never produced, and no 28-day notice under Section 35(1)(c) was issued nor payment in lieu. Procedural fairness was held mandatory, warranting notice pay and one month's salary as compensation given the desertion finding.

p. 5
03

Jurisdiction over work injury claim

Holding

The court lacks original jurisdiction over WIBA claims and referred the claim to the Director

Reasoning

The Respondent submitted, relying on section 52 of the Work Injury Benefits Act and decisions of Makau J and Rika J, that only the Director holds original jurisdiction over work injury claims, with the court exercising appellate jurisdiction. The court was persuaded, noting also that such claims require assessment on doctors' reports, and referred the claim to the Director of WIBA.

p. 6
04

Wrongful salary deductions

Holding

Deductions totalling Kshs. 28,578/- were proved and the employer failed to justify them

Reasoning

The Claimant pleaded specific months of deductions and produced bank statements showing salary below the admitted net salary of Kshs. 25,000/-. The employer, as custodian of records under Section 74, failed to produce pay slips or Mpesa records of alleged salary advances. The burden under Section 47(5) shifted to the employer, whose failure justified an award of the deducted sum.

p. 7

Legal principles established

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  • The burden of proving the reasons for termination lies with the employer under Section 43 of the Employment Act, and reasons are those genuinely believed to exist at the time of termination
  • An employee is entitled to procedural fairness under Section 41 of the Employment Act even where the reason for termination exists
  • This Court has only appellate, not primary, jurisdiction over WIBA compensation claims, which fall in the first instance to the Director under the Work Injury Benefits Act
  • The employer is the custodian of employment records, and once an employee demonstrates wrongful deductions the burden shifts to the employer to justify them under Section 47(5)

Court orders

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  1. 1.Compensation for unlawful termination equivalent to 1 month's gross salary of Kshs. 28,857/-
  2. 2.Notice pay for 1 month of Kshs. 28,857/-
  3. 3.Unpaid salary for 17 days for December 2018 of Kshs. 16,352.30
  4. 4.Refund of wrongful deductions of Kshs. 28,578/-
  5. 5.Payment in lieu of annual leave of 21 days of Kshs. 20,200/-
  6. 6.Total of Kshs. 122,844.30/- to be paid subject to statutory deductions
  7. 7.The claim for work injury is referred to the Director of WIBA for assessment under the WIBA Act
  8. 8.The Respondent to issue the Claimant with a Certificate of Service pursuant to Section 51 of the Employment Act
  9. 9.Respondent to pay Claimant costs of the suit
  10. 10.Interest on the award at court rates from date of judgment until payment in full

Authorities

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Legislation

  • Employment ActSection 43
  • Employment ActSection 44(4)(a)
  • Employment ActSection 41 and 41(2)
  • Employment ActSection 35(1)(c), 35(4)(b), 35(5), 35(6)(d)
  • Employment ActSection 28(1)(a)
  • Employment ActSection 51
  • Employment ActSection 74
  • Employment ActSection 47(5)
  • Employment ActSection 90
  • Work Injury Benefits ActSection 52
  • Evidence ActSection 112

Cases cited (2)

  • Paul Mututhii Mulwa v Board of Management Mbooni Boys High School
    (2020) eKLR
  • Saidi Mohammed v Diamond Industries Limited
    (2018) eKLR
Jurisdiction invoked
Original jurisdiction of the Employment and Labour Relations Court under the Employment Act; the court expressly declined jurisdiction over the WIBA work injury claim (Work Injury Benefits Act, section 52)

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, "Mirikau v Exon Investments Limited (Cause E002 of 2021) [2022] KEELRC 1441 (KLR)", Case Analysis (2022). Cause No E002 of 2021. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/1441/eng@2022-05-26

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