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ELRCDismissedCause No 698 of 2019· [2023] KEELRC 1468 (KLR)

SMW v DHL Kenya (Cause 698 of 2019) [2023] KEELRC 1468 (KLR)

Employment and Labour Relations Court
15 June 2023
6,778 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~27 min to read original · ~4 min brief

The bottom line

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What this practically means

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Executive summary

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The Claimant, employed by the Respondent (DHL Kenya) as a Field Sales Executive in March 2011, was seconded in April/May 2018 to DHL Swaziland as Country Manager. He alleged that the Respondent breached the secondment terms by failing to secure a work permit, review his salary, pay bonuses, provide a vehicle and family relocation, and that disciplinary processes in Swaziland and later in Kenya were flawed, culminating in his resignation on 23rd December 2019 which he pleaded as constructive termination. The Respondent maintained that the Claimant faced sexual harassment complaints, evaded disciplinary proceedings, stayed away from Swaziland, and that his secondment was terminated for unauthorized absence; it later took up disciplinary proceedings under its residuary mandate, and after his resignation purported to summarily dismiss him. The court analysed the law of secondment, holding that secondment creates a tripartite relationship in which the primary employer remains the legal employer while the host is the economic employer; only the primary employer can terminate the primary contract, while the host may terminate the secondment upon observing natural justice. The court found DHL Swaziland's process lawful and the Claimant's challenges to it an attempt to plead a defence after the fact. It held the Respondent legitimately exercised residuary disciplinary power, that the Claimant's resignation took effect immediately and rendered the purported termination of 17th February 2020 of no legal effect, but that constructive dismissal was not established. The claim was dismissed with costs to the Respondent.

Key legal issues

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01

Concept and consequences of secondment

Holding

Secondment creates a tripartite relation; the primary employer remains the legal employer, the host the economic employer; only the primary employer may terminate the primary contract while the host may only terminate the secondment

Reasoning

The court defined secondment as a temporary release of an employee to another employer with an expectation of resuming service with the original employer. It drew on academic writing and case law to hold that the primary employer retains legal responsibility save as expressly excluded by the secondment agreement, and drew a comprehensive agreement specifying responsibility for each right.

p. 3
02

Legality of DHL Swaziland's termination of the secondment

Holding

Lawful; the host employer observed natural justice by convening a disciplinary hearing, and the Claimant evaded the process

Reasoning

The court found the host employer received a sexual harassment complaint, summoned the Claimant to a disciplinary session, and only terminated the secondment after his continued unauthorized absence. It held the Claimant could not challenge the process he had frustrated by evasion, as that would amount to pleading a defence after the fact.

p. 7
03

Respondent's power to continue disciplinary proceedings after secondment closed

Holding

The primary employer holds residuary disciplinary mandate and could legitimately inquire into infractions committed during secondment

Reasoning

Upon termination of the secondment the employee reverts to the primary contract. The Respondent reinstated the Claimant to his former role and was entitled to take up the pending disciplinary matters. Instituting disciplinary action is not itself a breach of contract or evidence of a hostile work environment.

p. 10
04

Effect of the Claimant's resignation and the purported summary dismissal

Holding

The resignation of 23rd December 2019 terminated the contract; the Respondent's rejection of the resignation and subsequent termination of 17th February 2020 were of no legal effect

Reasoning

Resignation requires no employer concurrence and takes effect immediately, subject to contract terms on notice. Once an employee resigns, the employer loses disciplinary control as the substratum of that power is gone. However, because the resignation was a normal termination rather than a response to intolerable conditions, it yielded no constructive dismissal claim.

p. 10
05

Constructive dismissal

Holding

Not established; the resignation was not caused by intolerable conditions attributable to the Respondent

Reasoning

The Claimant could not rely on secondment-period events, having failed to resign while the secondment subsisted. The post-secondment conduct complained of - investigation and disciplinary process - did not constitute a significant breach going to the root of the contract. An employer commencing a disciplinary process does not thereby create a hostile work environment.

p. 12

Legal principles established

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  • Only the primary/legal employer can terminate the primary employment contract; the host employer may only terminate the secondment arrangement
  • An unequivocal resignation takes effect immediately without the employer's concurrence; pending disciplinary proceedings abate and the employer cannot reject or defer the resignation
  • The host employer is bound by natural justice before terminating a secondment
  • Residuary disciplinary power over a seconded employee for infractions during secondment vests in the primary employer
  • Unexplained delay in resigning in reaction to intolerable conduct waives the right to plead constructive dismissal

Court orders

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  1. 1.Dismissal of the Claimant's claim
  2. 2.Costs of the suit awarded to the Respondent

Authorities

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Legislation

  • Employment Actsection 35
  • Public Service Commission Actsection 42
  • County Governments Actsection 73
  • Employment and Labour Relations Court (Procedure) RulesRule 28(3)

Cases cited (7)

  • David Barasa v British Peace Support Team & Another
    [2016] eKLR
  • Nahashon Cheruiyot Ngeno v Strengthening of Mathematics & Science Education Project & another
    [2015] eKLR
  • Tonny Oira Bironga & 5 others v County Covernment of Nyamira & another
    [2022] eKLR
  • Kennedy Obala Oaga v Kenya Ports Authority
    [2018] eKLR
  • John Onyancha Zurwe v Oreti Atinda
    [2009] eKLR
  • Herbert Wafula Waswa v Kenya Wildlife Services
    [2020] eKLR
  • Coca Cola East & Central Africa Limited v Maria Kagai Ligaga
    [2015] eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over unfair termination/constructive dismissal claims

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, "SMW v DHL Kenya (Cause 698 of 2019) [2023] KEELRC 1468 (KLR)", Case Analysis (2023). Cause No 698 of 2019. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/1468/eng@2023-06-15

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