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ELRCPartially AllowedNot stated in the judgment as provided· [2022] KEELRC 1541 (KLR)

Wachira v Gusii Water & Sanitation Co Ltd & 7 others (Petition E002 of 2022) [2022] KEELRC 1541 (KLR)

Employment and Labour Relations Court
18 May 2022
RSRadido Stephen
1,352 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~5 min to read original · ~4 min brief

The bottom line

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A Kenyan court voided a water company job advert placed by shareholders without board authority, but refused a constructive dismissal claim because the employee never resigned.

What this practically means

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Executive summary

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The petitioner, Commercial Manager of Gusii Water & Sanitation Co Ltd since September 2019, was appointed acting Managing Director in October 2021. In November 2021 two County Executive Committee members (for Water, Nyamira and Kisii) circulated notice appointing the 7th and 8th respondents as acting MD and Deputy MD, creating parallel leadership. The petitioner was then issued a show-cause for laxity and her substantive position was advertised in the Daily Nation on 28 January 2022, and she was locked out of her office - facts verified by a County Labour Officer's report. She petitioned, alleging unlawful secondment, unlawful advertisement and constructive dismissal, and sought interim relief; the court issued an interim injunction on 24 February 2022. On sub judice grounds under section 6 of the Civil Procedure Act, the court declined to examine the lawfulness of the 7th and 8th respondents' appointment, a live issue in earlier proceedings before the ELRC at Kericho. On the merits it held that the company, a separate juristic person, vests recruitment in its board; the 4th and 5th respondents, mere shareholders or their representatives, acted without authority in publishing the vacancy. However, constructive dismissal failed because the petitioner never resigned. The court declared the 28 January 2022 advertisement null and void, quashed it, and ordered the 4th and 5th respondents, whose decision was capricious, to pay the petitioner's costs. Judgment delivered at Kisumu on 18 May 2022 by Radido Stephen, J.

Key legal issues

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01

Whether the petition challenging the circular appointing the 7th and 8th respondents was sub judice

Holding

The court declined to determine the lawfulness of the appointments because the same issue was pending before the ELRC at Kericho, which had been seised earlier and had issued orders on 1 February 2022

Reasoning

A petition before the Kericho ELRC (Thomson Kerongo & Ar v County Government of Kisii & Ors, Petition No E009 of 2021) raised the same challenge to the same circular and was filed earlier. Relying on section 6 of the Civil Procedure Act, the court declined jurisdiction over that limb, noting the Kericho court had restrained the 7th respondent from assuming office and directed the petitioner to continue serving as acting MD.

p. 4
02

Whether the advertisement of the Commercial Manager position was lawful

Holding

The advertisement was null and void because it was made by persons without authority - the 4th and 5th respondents were not board members and no board resolution authorised the recruitment

Reasoning

The company is a juristic person distinct from its shareholders; its articles vest recruitment of staff in the board of directors. No board resolution authorising the recruitment was produced. The 4th and 5th respondents did not deny causing the advertisement and were mere shareholders or representatives of shareholders, so acting beyond their legal province even if no board was in place.

p. 4
03

Whether the petitioner was constructively dismissed

Holding

No constructive dismissal was established because, although the employer's conduct was designed to hound her out, the petitioner never resigned

Reasoning

The unlawful advertisement and the lock-out of the petitioner's office were acts orchestrated to push her out of employment. However, constructive dismissal requires the employee to respond to the repudiation by leaving. Since the petitioner remained in employment, the claim was premature and failed.

p. 4

Legal principles established

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  • Only the board of directors, under the company's articles, may lawfully cause a vacancy in an employee's position to be advertised; shareholders who are not directors cannot do so
  • Constructive dismissal requires the employee to take the positive step of resigning or leaving in response to the employer's repudiatory conduct

Court orders

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  1. 1.A declaration that the advertisement in the Daily Nation newspaper of 28 January 2022 in respect to the position of Commercial Manager was null and void
  2. 2.An order quashing the advertisement in the Daily Nation newspaper of 28 January 2022 in respect to the position of Commercial Manager
  3. 3.The 4th and 5th respondents condemned to pay the costs of the petition

Authorities

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Legislation

  • Civil Procedure Actsection 6

Cases cited (1)

  • Thomson Kerongo & Ar v County Government of Kisii & Ors
    Petition No E009 of 2021
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over employment and labour relations disputes (petition challenging employer conduct); specific enabling article not cited in the extract

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, "Wachira v Gusii Water & Sanitation Co Ltd & 7 others (Petition E002 of 2022) [2022] KEELRC 1541 (KLR)", Case Analysis (2022). Not stated in the judgment as provided. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2022/1541/eng@2022-05-18

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