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ELRCPartially AllowedCause No 764 of 2015· [2023] KEELRC 823 (KLR)

Mabil v Direct Channel Simbatech [K] Limited (Cause 764 of 2015) [2023] KEELRC 823 (KLR)

Employment and Labour Relations Court
10 February 2023
6,918 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 awarded an employee over Kshs.2.8 million after finding his dismissal for poor performance unfair and discriminatory.

What this practically means

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Executive summary

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The Claimant, employed by the Respondent from about September 2009 (per the Respondent's pleading) and rising to Operations Manager, was terminated on 17th March 2015. He claimed unfair termination, discrimination, unfair demotion, and non-payment of terminal dues, seeking over Kshs.2 million in damages, service pay, house allowance, notice pay and leave pay. The Respondent defended the termination as grounded on poor performance, absenteeism, lateness and disobedience, and asserted procedural compliance with sections 41 and 45 of the Employment Act, 2007, including payment of terminal dues by cheque. The court framed three issues: validity of the termination procedurally and substantively, discrimination, and remedies. It found the termination substantively unjustified because no performance appraisal was conducted despite a recommendation, so no parameters measured the alleged poor performance, and the reasons in the show cause letter were not reflected in the termination letter. Procedurally, the 4th March 2015 disciplinary hearing dealt with misconduct, not performance, and the Claimant was terminated on the very day he responded to the show cause letter, with no further hearing. On discrimination, the Claimant proved removal from medical cover and denial of bonuses paid to peers, unrebutted by the Respondent, which bore the burden under section 5(7). The court awarded general damages of Kshs.2,000,000/-, notice pay of Kshs.65,000/-, leave pay of Kshs.284,375/- and 8 months' compensation of Kshs.520,000/-. Service pay was denied on NSSF membership grounds and house allowance because the salary was consolidated. Costs and interest were awarded to the Claimant.

Key legal issues

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01

Whether termination was substantively justified

Holding

Not justified - the Respondent failed to prove a valid and fair reason; no performance appraisal was conducted despite recommendation

Reasoning

The termination letter cited poor performance and inability to fit new operational roles. Under section 45(2), the employer must prove a valid reason. No performance appraisal was done despite a recommendation, so no parameters for assessing performance existed. The reasons in the show cause letter were not repeated in the termination letter, undermining the claimed justification.

p. 10
02

Whether termination followed fair procedure under section 41

Holding

No fair hearing was accorded; termination was procedurally flawed

Reasoning

The disciplinary hearing of 4th March 2015 dealt with misconduct complaints, not poor performance. After the show cause letter of 13th March 2015, the Claimant responded on 17th March 2015, the very day he was terminated, with no further hearing. The mandatory notification and hearing requirements of section 41 were thus breached.

p. 11
03

Whether the Claimant was discriminated against

Holding

Yes - differential treatment proved regarding medical cover and bonus

Reasoning

The Claimant proved he was removed from the medical scheme while others remained, was told as a single man he did not need cover, and was denied bonuses paid to colleagues. These averments were not rebutted by evidence. Under section 5(7) the employer bears the burden of disproving alleged discrimination, which it failed to discharge.

p. 12
04

Remedies payable

Holding

General damages for discrimination of Kshs.2,000,000, notice pay, leave pay and 8 months' compensation awarded; service pay and house allowance declined

Reasoning

Having found unfair termination and discrimination, the court awarded damages under sections 36, 45, 49(1) and 5 of the Employment Act, considering length of service, demeaning treatment, unilateral demotion, cancellation of the terminal dues cheque, and the consolidated salary and NSSF membership which defeated the service pay and house allowance claims.

p. 15

Legal principles established

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  • For a termination to be fair there must be both substantive justification and procedural fairness
  • An employer terminating for poor performance bears a high level of proof, including a performance measurement policy, appraisal, and a hearing
  • In discrimination claims under section 5(7) of the Employment Act, the employer bears the burden of proving the discrimination did not occur

Court orders

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  1. 1.Declaration that the termination of the Claimant's employment was unlawful, unfair and in breach of the Employment Act, 2007
  2. 2.General damages of Kshs.2,000,000/- for discrimination
  3. 3.Kshs.65,000/- being one month's pay in lieu of notice
  4. 4.Kshs.284,375/- for 113.75 untaken leave days
  5. 5.Compensation of 8 months' salary, Kshs.520,000/-, for unfair termination
  6. 6.Costs of the claim to the Claimant
  7. 7.Interest on terminal dues from date of filing suit and on all other claims from the date of Judgment until payment in full

Authorities

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Legislation

  • Employment ActSections 5, 10(2) and (5), 31(2), 35, 35(1)(c), 35(6), 36, 41, 42(1), 43, 44(3) and (4), 45, 45(2), 47(5), 49(1)
  • Evidence ActSection 108
  • Constitution of Kenya, 2010Article 28

Cases cited (12)

  • Walter Ogal Anuro v Teachers Service Commission
    (2013) eKLR
  • G.M.V v Bank of Africa Limited
    (2013) eKLR
  • Barclays Bank of Kenya Ltd & Another v Gladys Muthoni & 20 Others
    (2018) eKLR
  • Louw v Golden Arrow Bus Services (Pty) Ltd
    (1999) ZALC166
  • D.K Njagi Marete v Teachers Service Commission
    (2020) eKLR
  • Godfrey Julius Ndumba Mbogori & Another v Nairobi City County
    (2018) eKLR
  • Abraham Gumba v Kenya Medical Supplies Authority
    (2014) eKLR
  • Ali Issa Omar v Car & General (Trading) Ltd
    (2020) eKLR
  • Jane Samba Mukala v Oltukai Lodge Limited
    (2010) LLR 225
  • National Bank of Kenya v Samuel Nguru Mutonya
    (2019) eKLR
  • Pius Machafu Isindu v Lavington Security Guards Limited
    (2017) eKLR
  • Nyarangi & 3 Others v Attorney General
    (2008) KLR 688
Jurisdiction invoked
Original jurisdiction under the Employment Act, 2007 (Employment and Labour Relations Court)

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, "Mabil v Direct Channel Simbatech [K] Limited (Cause 764 of 2015) [2023] KEELRC 823 (KLR)", Case Analysis (2023). Cause No 764 of 2015. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/823/eng@2023-02-10

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