Dharmadhikhari v Professional Media Africa Limited (Cause 622 of 2017) [2023] KEELRC 186 (KLR)
The bottom line
#A Kenyan court ruled an employer couldn't disguise a firing as resignation, awarding the former manager about Ksh. 3.6 million in unpaid dues and compensation.
What this practically means
#Executive summary
#Key legal issues
#Whether the separation was by resignation or unilateral termination
The termination was through the Respondent's unilateral decision, not the Claimant's resignation; the alleged resignation of 31st January 2017 lapsed and the relation was impliedly revived, so termination could not relate back to it
Both parties agreed the Claimant was still in service on 1st March 2017, long after the alleged resignation date. In law resignation takes effect when notice issues or on the later intimated date, without needing employer acceptance. Continued service past the alleged resignation date impliedly revived the employment relation, so the separation of 1st March 2017 was for reasons other than resignation or redundancy.
Whether the termination was lawful and procedurally fair
The termination was unlawful both substantively and procedurally; the alleged redundancy was unproved, no valid reason for termination was established, and no due process under section 41 was followed
The Respondent failed to prove the financial constraints said to justify redundancy and did not follow section 40 procedure. Having abandoned redundancy and resignation, it advanced no other valid reason; allegations of competition and absenteeism were unsupported. The 30th March 2017 meeting was for a mutual separation package, not a section 41 disciplinary session, so no due process preceded the termination.
Whether the Claimant could recover salary underpayments despite acquiescence and laches
The underpayments were recoverable; equity cannot defeat the statutory consultation and written-variation requirements, and the laches defence failed as it was unpleaded and the suit was filed within three years
The Respondent admitted the reduced salary figures in its pleadings. Section 10(5) of the EA requires consultation and written communication for detrimental variation, which was not done. Laches was not pleaded, and the suit filed on 31st March 2017 was within the three-year limitation period, so the doctrine could not bar the arrears claim of Ksh. 1,600,000/-.
Remedies payable for the unlawful termination
The Claimant was awarded March 2017 salary, two months' pay in lieu of the notice shortfall, leave dues, salary arrears, and three months' salary as compensation, but not severance pay
The contract dated 14th January 2013 continued after its two-year term on the same terms, entitling the Claimant to three months' notice; only one month was given, leaving a two-month shortfall. Compensation of three months' salary was assessed under section 49, taking into account that the Claimant contributed nothing to the termination. Severance pay is unavailable because the remedies fall under section 49, not section 40.
Legal principles established
#- An employee's resignation takes effect when notice is issued or on the later date intimated, and its validity does not depend on employer acceptance
- Where an employee allegedly resigns but continues working past the stated resignation date, the employer-employee relation is impliedly revived and the later termination cannot relate back to the resignation
- Equity cannot be invoked to excuse a statutory obligation; an employer cannot rely on acquiescence or laches to defeat the written-consultation requirement for varying emoluments under section 10(5) of the Employment Act
- It is impermissible for a litigant to rely on a defence that was not expressly pleaded
- Variation of an employee's emoluments to the employee's detriment requires prior consultation and written communication under section 10(5) of the Employment Act
Court orders
#- 1.Declared the Respondent's termination of the Claimant's contract of employment unlawful
- 2.Declined the prayer for severance pay
- 3.Awarded leave dues of Ksh. 192,500/-
- 4.Declined the prayer for one way air tickets to India for the Claimant and his family
- 5.Awarded salary for March 2017 in the sum of Ksh. 300,000/-
- 6.Awarded pay equivalent to two months' salary in lieu of notice, Ksh. 600,000/-
- 7.Awarded salary arrears of Ksh. 1,600,000/-
- 8.Awarded compensation for wrongful termination equivalent to three months' gross salary, Ksh. 900,000/-
- 9.Awarded interest on the amounts awarded at court rates from the date of institution of the case till payment in full
- 10.Directed that the award is subject to applicable statutory deductions under section 49 of the Employment Act
- 11.Awarded the Claimant costs of the case
- Jurisdiction invoked
- Original employment and labour relations jurisdiction of the Employment and Labour Relations Court under the Employment Act; first-instance claim for compensation for unfair termination
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Dharmadhikhari v Professional Media Africa Limited (Cause 622 of 2017) [2023] KEELRC 186 (KLR)", Case Analysis (2023). Cause No 622 of 2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/186/eng@2023-01-30
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.