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ELRCDismissedCause No 450 of 2019· [2023] KEELRC 2739 (KLR)

Iriga v Gold Crown Beverages (Kenya) Limited (Cause 450 of 2019) [2023] KEELRC 2739 (KLR)

Employment and Labour Relations Court
24 October 2023
1,476 words in judgment
View original judgmentRead on Kenya Law Watch case
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·~6 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court dismissed a manager's unfair dismissal claim, ruling his employer lawfully terminated him for missed performance targets, with no damages awarded.

What this practically means

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Executive summary

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This was an Employment and Labour Relations Court claim originally filed by Statement of Claim dated 8th July, 2019, alleging wrongful and unlawful termination of the Claimant's employment contract and the Respondent's refusal to pay terminal benefits. The Claimant, engaged by a Written Employment Agreement dated 17th April, 2015 as a Regional Sales Manager earning Kshs.120,000/- monthly, alleged he was summarily dismissed by a letter dated 7th January, 2017 for allegedly unimpressive performance, without notice and in breach of Sections 41(1) and 44(3) of the Employment Act, 2007. He sought Kshs.1,505,000/- comprising 12 months' salary as damages for unlawful termination and interest on deductions for a car loan and a tablet advance, plus general damages, costs and interest. The Respondent denied the claim, asserting the dismissal was for gross misconduct arising from consistently missed performance targets, that salary in lieu of notice and service pay were paid, and that the deductions were contractual and consented to. The court framed four issues: whether the termination was wrongful, unfair and unlawful; entitlement to refund of and interest on the deductions; entitlement to the damages claimed; and costs. Relying on its assessment of the evidence, the court found the Respondent's case the more probable on a balance of probabilities and held the termination lawful. Consequently, the Claimant was held disentitled to all reliefs. The claim was dismissed with each party bearing their own costs. Judgment was delivered, dated and signed on 24th October, 2023 by D. K. Njagi Marete, Judge.

Key legal issues

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01

Whether the Claimant's termination was wrongful, unfair and unlawful

Holding

The termination was lawful; the Respondent's case was more probable on the balance of probabilities.

Reasoning

The Claimant relied on Kenfreight (E.A) Limited v Benson K. Nguti and Section 47(5) of the Employment Act on burden of proof. The Respondent contended the dismissal was for consistently missed performance targets, that it treated the termination as normal termination and paid salary in lieu of notice and service pay. On the evidence, the court found the Respondent's case the more probable and held the termination lawful.

p. 4
02

Whether the Claimant is entitled to the refund claimed and interest on the unlawful deductions

Holding

No; the deductions were contractually permitted and the claim failed with the main claim.

Reasoning

The Respondent relied on Section 19(1)(h) of the Employment Act permitting wage deductions on account of loans, noting the deductions were contractual and unprotested. It further argued, citing New Tyres Enterprises Ltd v Kenya Alliance Insurance Company Ltd, that interest predating suit required a contractual stipulation. The court found the Claimant disentitled upon losing the unfair termination claim.

p. 3
03

Whether the Claimant is entitled to the damages claimed and costs

Holding

The claim was dismissed in its entirety with each party bearing their own costs.

Reasoning

Having failed to establish unlawful termination, the Claimant could not sustain the damages claim. The court, in its disposition, dismissed the claim and declined to award costs to either side, directing that each party bear their own costs of the suit.

p. 4

Legal principles established

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  • An employer must demonstrate that the reason for termination is valid and fair and that a fair procedure was followed; the employee's burden is limited to asserting that unfair termination occurred (as per Kenfreight (E.A) Limited v Benson K. Nguti, cited).
  • Interest claimed prior to the date of suit is a matter of substantive law and may only be claimed on the basis of a contractual stipulation (as per New Tyres Enterprises Ltd v Kenya Alliance Insurance Company Ltd, cited).
  • The court determines the competing cases of the parties on a balance of probabilities.

Court orders

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  1. 1.Claim dismissed
  2. 2.Each party to bear their own costs of the suit

Authorities

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Legislation

  • Employment Act, 2007Section 41(1)
  • Employment Act, 2007Section 44(3)
  • Employment Act, 2007Section 47(5)
  • Employment Act, 2007Section 49(4)
  • Employment Act, 2007Section 19(1)(h)

Cases cited (3)

  • Kenfreight (E.A) Limited v Benson K. Nguti
    [2019] eKLR
  • Joseph Omondi Owino vs Epco Builders Company Limited
    [2019] eKLR
  • New Tyres Enterprises Ltd vs Kenya Alliance Insurance Company Ltd
    [1988] eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 (Sections 41(1), 44(3), 47(5) and 49(4) cited)

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, "Iriga v Gold Crown Beverages (Kenya) Limited (Cause 450 of 2019) [2023] KEELRC 2739 (KLR)", Case Analysis (2023). Cause No 450 of 2019. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/2739/eng@2023-10-24

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