Khayo v Borderless Tracking Limited (Cause 538 of 2019) [2023] KEELRC 518 (KLR)
The bottom line
#A Kenyan court ruled that resigning because your employer broke the employment contract counts as unfair dismissal and deserves compensation.
What this practically means
#Executive summary
#Key legal issues
#Whether the claimant's resignation amounted to constructive dismissal
Yes. Applying the Coca Cola principles, the failure to issue a contract after probation and the unaddressed complaints of hostile work environment and non-remittance of statutory deductions amounted to repudiatory breach; the claimant was constructively dismissed and unfairly dismissed under section 45 of the Employment Act.
The court adopted the Coca Cola East & Central Africa v Ligaga test, including repudiatory breach going to the root of the contract, an objective test, causation, and the burden on the employee. The resignation letter raised serious grievances - non-issuance of the contract after probation and hostile conditions - which the respondent never answered. The respondent also failed to produce employment records to disprove non-compliance with statutory deductions. The claimant therefore had legitimate grounds justifying constructive dismissal.
Whether the claimant was entitled to the reliefs sought
Partially. Compensation was limited to 2 months' salary (kshs 240,000/-) given less than one year of service; loss of income pending official retirement was refused as not provided in law; certificate of service and costs were granted.
The court exercised remedial discretion proportionate to the short length of service, declining the 12 months' compensation sought and refusing prospective loss of earnings because the law does not provide for it. The certificate of service was ordered, which the respondent had already offered, plus costs and interest.
Legal principles established
#- Failure to issue a contract of employment and terms of employment after the probation period has elapsed may demonstrate fundamental breach of the employment contract entitling the employee to treat the contract as repudiated
- Where an employer is in custody of employment records and a claimant makes allegations challenging compliance, the employer bears the evidential onus of producing those records to controvert the claim
Court orders
#- 1.A finding that the claimant was constructively dismissed, amounting to unfair dismissal under section 45 of the Employment Act
- 2.Compensation for unfair termination equivalent to 2 months' salary totalling kshs 240,000/-
- 3.Claimant to receive her certificate of service within 14 days from the date of judgment
- 4.Costs awarded to the claimant with interest at court rates from the date of judgment until full payment
- Jurisdiction invoked
- Original jurisdiction of the Employment and Labour Relations Court under the Employment Act, 2007 (claim of unfair and constructive dismissal); judgment delivered virtually pursuant to Article 159(2)(d) and Article 48 of the Constitution and Section 1B of the Civil Procedure Act
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Khayo v Borderless Tracking Limited (Cause 538 of 2019) [2023] KEELRC 518 (KLR)", Case Analysis (2023). Cause No 538 of 2019. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/518/eng@2023-02-23
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.