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ELRCPartially AllowedCause No E509 of 2022· [2023] KEELRC 2924 (KLR)

Otieno v Ison Technologies Kenya Limited (Cause E509 of 2022) [2023] KEELRC 2924 (KLR)

Employment and Labour Relations Court
16 November 2023
4,621 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
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The bottom line

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A Kenyan court upheld a sales executive's dismissal as fair, but ordered his employer to pay Kes 404,460 in unpaid house allowance.

What this practically means

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Executive summary

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The claimant, employed as a Sales Executive from July 1, 2015, sued for unfair termination following his dismissal on August 28, 2020 over alleged absenteeism from August 12 to 14, 2020. He sought 12 months' compensation, unpaid house allowance, notice pay, costs and interest, contending he attended a meeting at Path International, worked from home due to COVID-19, and compensated a leave day; he further alleged bias by the Human Resource Manager who issued the notice to show cause and sat on the disciplinary committee, and retaliation for declining to give a false statement in another cause. The respondent maintained the dismissal was for gross misconduct, procedurally fair, and that the claimant proved nothing. The court framed two issues: whether the termination was unfair and whether the reliefs were due. Relying on sections 35, 41, 43, 44, 45 and 47(5) of the Employment Act, 2007, and the band of reasonableness test, the court found the respondent genuinely believed on reasonable grounds that the claimant absented himself without leave, satisfying substantive justification. Procedurally, the committee was properly constituted, the alleged bias unsubstantiated, and the claimant's defence was considered. Compensation and notice pay were declined. However, as the contract was silent on consolidation and the payslip showed basic salary, the court awarded house allowance at 15% of basic salary for three years, Kes 404,460/=, dismissed the rest of the suit, and awarded the claimant 50% of the costs.

Key legal issues

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01

Whether the respondent had a valid and fair reason to terminate the claimant's employment (absenteeism without leave).

Holding

Yes - the respondent proved on a balance of probabilities that it genuinely believed the claimant absented himself without leave or authority for the three days in question.

Reasoning

The claimant admitted absence on 14th August and failed to prove the leave compensation was authorised. His explanations for 12th and 13th August were unsupported: no contact person for the alleged Path International meeting, no notification to the supervisor, and conflicting emails about working from home. Under section 43(2), the employer's genuine belief suffices, per the band of reasonableness test and section 44(4)(a) gross misconduct.

p. 7
02

Whether the termination procedure was fair under section 41 of the Employment Act.

Holding

Yes - notice to show cause, response, hearing invitation with rights, hearing attendance and participation, and communication of the decision satisfied the statutory procedure; the alleged bias of the HR Manager was unsubstantiated.

Reasoning

The committee was constituted per the HR Manual (three senior members including HR). Minutes showed the claimant freely participated and signed without protest. The HR Manager's role did not establish bias absent evidence she decided alone or beforehand. The claimant never requested witnesses or objected. The four Postal Corporation elements were met.

p. 9
03

Whether the claimant was entitled to unpaid house allowance.

Holding

Yes - the contract was silent on consolidation and the payslip showed basic salary, entitling the claimant to 15% of basic salary for 3 years (Kes 404,460/=).

Reasoning

Section 31 obliges employers to house employees or pay housing allowance. RWI admitted the contract did not state the salary was consolidated, and the payslip expressly showed basic salary. The respondent's contrary submission failed; the claimant testified his salary was not consolidated.

p. 10

Legal principles established

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  • A termination must be shown to be both substantively justified and procedurally fair to pass the fairness test.
  • The employer need only prove reasons it genuinely believed to exist, on a balance of probability (partly subjective test).
  • The mere fact that the Human Resource Manager issued the notice to show cause and sat at the hearing does not of itself establish bias.
  • Where the contract is silent on consolidation and the payslip states basic salary, the employee is entitled to house allowance at 15% of basic salary.

Court orders

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  1. 1.Award of house allowance at 15% of basic salary for 3 years, Kes 404,460/=
  2. 2.Dismissal of the claimant's suit save for the house allowance award
  3. 3.The claimant is awarded 50% of the costs of the suit

Authorities

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Legislation

  • Employment Act, 2007sections 31, 31(2)(a), 35, 35(4), 41, 43, 43(2), 44, 44(4), 44(4)(a), 45, 47(5)
  • Civil Procedure RulesOrder 21 Rule 1
  • Civil Procedure ActSection 1B
  • Constitution of KenyaArticles 159(2)(d), 48

Cases cited (19)

  • Joshua Rodney Marimba v Kenya Revenue Authority
    (2019) eKLR
  • Nicholus Muasya Kyula v Farmchem Ltd
    (2012) eKLR
  • Rebecca Ann Maina & 2 others v Jomo Kenyatta University of Agriculture and Technology
    (2014) eKLR
  • Lucy Woldu v African Development Solution (ADESCO)
    (2021) eKLR
  • Sheila Wikashei & another v Super Broom Services Ltd
    (2022) eKLR
  • Nisha Nileshbhai Bhavsar v Kensalt Ltd
    (2022) eKLR
  • Pamela Nelima Lutta v Mumias Sugar Co. Ltd
    (2017) eKLR
  • Anne Wambui Ndiritu v Joseph Kiprono Ropkoi & another
    (2005) 1 EA 334
  • JK Patel v Spear Motors Ltd
    (1993) VI KALR
  • Postal Corporation of Kenya v Andrew K. Tanui
    (2019) eKLR
  • South Nyanza Sugar Co. Ltd v Leonard O. Arera
    (2020) eKLR
  • National Bank of Kenya Ltd v Pipe Plastic Samkolit
    (2002) 2 E.A 503
  • Pius Kimaiyo Langat v Cooperative Bank of Kenya Ltd
    (2017) eKLR
  • Omar Ndaro Zuma v Modern Coast Express
    (2019) eKLR
  • Walter Ogal Anuro v Teachers Service Commission
    (2013) eKLR
  • Naima Khamis v Oxford University Press E.A Ltd
    (2017) eKLR
  • Kenya Revenue Authority v Reuwel Waithaka Gitahi & 2 others
    (2019) eKLR
  • British Leyland UK Ltd v Swift
    (1981) IRLR 91
  • Pius Machafu Isindu v Lavington Security Guards Ltd
    (2017) eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction over employment disputes (Employment Act, 2007; ELRC)

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, "Otieno v Ison Technologies Kenya Limited (Cause E509 of 2022) [2023] KEELRC 2924 (KLR)", Case Analysis (2023). Cause No E509 of 2022. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/2924/eng@2023-11-16

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