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ELRCDismissedNot stated in the judgment· [2023] KEELRC 2304 (KLR)

Mutuku v Jocham Hospital (Cause E010 of 2022) [2023] KEELRC 2304 (KLR)

Employment and Labour Relations Court
21 September 2023
MMM. Mbarũ
3,208 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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What this practically means

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Executive summary

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The claimant, employed from 2007 and rising to chief accountant, alleged constructive dismissal in April 2019, claiming he was suspended and pressured to resign amid hostile work conditions after he reported irregularities in a drugs tender and was blamed for unbanked sales of Kshs. 411,916 during his annual leave. He sought declarations of constructive dismissal and unfair termination, leave pay of Kshs. 83,000, notice pay of Kshs. 83,000, compensation of Kshs. 996,000, gratuity of Kshs. 290,500 plus Kshs. 63,846.15, and costs. The respondent's case was that a routine audit by Derrick Majani/Selpha Nanzala revealed irregularities in petty cash, float management and banking; the claimant was suspended for 14 days to allow investigations, responded on 10 April 2019 admitting a shortfall of Kshs. 15,046 and offering repayment, then resigned on 11 April 2019 before investigations concluded. He had already been paid terminal dues of about Kshs. 101,491 and issued a certificate of service. The court framed two issues: whether there was constructive dismissal and whether reliefs should issue. Relying on Isanya, Kipchumba, Oaga and Michuki, it held that resignation is termination at the employee's instance and an employee who resigns to circumvent a disciplinary process cannot claim unfair termination. The claimant resigned voluntarily before any show cause notice issued, so constructive dismissal was not made out. The gratuity claim failed for want of any contract or policy establishing it, and leave pay failed because the 12 leave days due were already cashed in the terminal dues. The entire suit was dismissed with costs to the respondent.

Key legal issues

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01

Constructive dismissal

Holding

Not established; the claimant resigned voluntarily before disciplinary process concluded

Reasoning

The claimant was suspended to allow investigations into audit irregularities, responded to the audit findings, admitted a shortfall of Kshs. 15,046 and offered repayment. No show cause notice or disciplinary hearing had issued. He resigned the day after submitting his responses, which the court held circumvented the investigative process. His claim of a hostile environment and ultimatum from the CEO was not accepted on the evidence.

p. 6
02

Gratuity

Holding

Claim fails for want of contractual or policy basis

Reasoning

The claimant pleaded gratuity for 7 years plus a balance for 4 years but did not attach any contract, policy or agreement entitling him to gratuity; in submissions he merely reiterated the claim without details.

p. 6
03

Leave pay

Holding

Claim fails; leave days were paid in terminal dues

Reasoning

The respondent tabulated terminal dues including 12 days leave earned at Kshs. 36,923; the claimant admitted receipt and issuance of the certificate of service. The employer as custodian of records established the leave position.

p. 6

Legal principles established

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  • An employee who resigns to circumvent an ongoing disciplinary or investigative process cannot claim constructive dismissal or unfair termination
  • Gratuity is not automatic and must be founded on a term of the contract, a policy or an agreement between the parties
  • The employer as custodian of work records bears the position of trust on leave records, and leave days cashed at exit are deemed paid

Court orders

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  1. 1.The claims made are dismissed with costs to the respondent

Authorities

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Legislation

  • Employment ActSections 35 and 36

Cases cited (4)

  • Milton M Isanya v Aga Khan Hospital Kisumu
    (2017) eKLR
  • Edwin Beiti Kipchumba v National Bank of Kenya Limited
    [2018] eKLR
  • Kennedy Obala Oaga v Kenya Ports Authority
    [2018] eKLR
  • Stephen Michuki v East African Safari Air Express Limited & another
    [2022] eKLR
Jurisdiction invoked
Employment and Labour Relations Court original jurisdiction under employment law (Sections 35 and 36 of the Employment Act invoked); specific enabling provision not stated in the judgment

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (1)

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Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

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Cite this brief

Caselaw, "Mutuku v Jocham Hospital (Cause E010 of 2022) [2023] KEELRC 2304 (KLR)", Case Analysis (2023). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/2304/eng@2023-09-28

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