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ELRCPartially AllowedMemorandum of Claim dated 28th June 2021· [2023] KEELRC 3102 (KLR)

Mulwa v Kenya Film Commission (Employment and Labour Relations Cause E528 of 2021) [2023] KEELRC 3102 (KLR)

Employment and Labour Relations Court
16 November 2023
7,346 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~29 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court ordered Kenya Film Commission to pay a dismissed manager over Kshs 3.7 million for firing him without a hearing or valid reason.

What this practically means

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Executive summary

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The Claimant, formerly Marketing and Product Development Manager (later Director of Marketing) of the Respondent Commission, was employed on permanent and pensionable terms from 2010. Following the Commission's 2018 Human Resource reorganization, he was offered placement as Manager, Film and Digital Marketing on a three-year fixed-term contract with reduced allowances. He rejected the conversion, but after negotiations the Respondent, by letter dated 26th May 2020, agreed that he retain permanent and pensionable terms. A later letter of 30th July 2020 purportedly reinstating the contractual terms was held never to have been served and to be an afterthought. After prolonged correspondence, the Respondent by letter dated 16th June 2021 directed the Claimant to vacate office immediately without notice or a show-cause hearing. The Court framed three issues: how termination occurred, whether it was fair, and entitlement to reliefs. It held the Respondent terminated the employment by the 16th June 2021 letter, effecting summary dismissal. Procedural fairness under section 41 of the Employment Act and the HR Manual's disciplinary procedure was not observed, and the burden of proving valid and fair reasons under sections 43 and 45(2) was not discharged, since dismissal for refusing to abandon an agreed position could not be valid. The unilateral reduction of allowances breached section 10(5) and was an unfair labour practice. Judgment was entered for the Claimant: a declaration of unfair and unlawful termination, eleven months' gross salary compensation, one month's notice pay, compensation for unutilized leave days, unpaid house allowance, interest, a Certificate of Service within 30 days, and costs against the Respondent. Reinstatement was refused as it had not been pleaded.

Key legal issues

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01

How the employment was terminated

Holding

The Claimant's employment was terminated by the Respondent through its letter dated 16th June 2021, which amounted to summary dismissal

Reasoning

The parties took opposite positions on how the separation occurred. The Court reasoned that where a party is in repudiatory breach, the contract subsists until the innocent party accepts the breach and ends the contract. The Respondent's letter of 16th June 2021 accepting what it considered repudiation brought the contract to an end.

p. 8
02

Procedural fairness of the termination

Holding

The dismissal was procedurally unfair; the mandatory procedure under section 41 of the Employment Act and the disciplinary procedure in the HR Manual were not followed

Reasoning

Section 41 prescribes a mandatory three-component process: notification in writing of the grounds, a hearing with the right to be accompanied, and consideration of representations. The Respondent adduced no evidence of following this procedure and counsel did not address section 41. The HR Manual's disciplinary procedure mirrored section 41 and was also not applied.

p. 10
03

Substantive fairness of the termination

Holding

The dismissal was substantively unfair because the reason - refusal to accept conversion of terms - was invalid in light of the concluded agreement of 26th May 2020 retaining permanent and pensionable terms

Reasoning

The letter of 26th May 2020 recorded a negotiated agreement that the Claimant serve on permanent and pensionable terms. The later letter of 30th July 2020 was never proved to have been served, did not mention the 26th May agreement, and no Board minutes supported it; it was an afterthought. Dismissal for refusing to abandon an agreed position could not be a valid and fair reason.

p. 12
04

Unilateral variation of allowances

Holding

The Respondent's reduction of the Claimant's allowances without consultation breached section 10(5) of the Employment Act and amounted to an unfair labour practice; the claim for unpaid house allowance succeeded

Reasoning

Salary and allowances are protected terms that cannot be varied without consultation. There was no specific denial of the detrimental variation of house allowance from Kshs. 60,000 to Kshs. 50,000. The Court adopted the reasoning in the Kenafric Industries case and held the relief was pleaded with sufficient specificity.

p. 14

Legal principles established

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  • An employer bears the legal burden of proving both procedural fairness and the validity and fairness of the reasons for termination
  • Salary and contractual or statutory allowances may not be varied unilaterally without consultation; such unilateral variation is unlawful ab initio
  • Where an employer alleges service of a document on an employee and the employee denies it, the employer must prove service

Court orders

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  1. 1.A declaration that the termination of the Claimant's employment was unfair and unlawful
  2. 2.Compensation for unlawful termination pursuant to section 49[1][c] of the Employment Act, 11 months' gross salary - Kshs. 3,142,700
  3. 3.One month's salary in lieu of notice - Kshs. 285,700
  4. 4.Compensation for unutilized leave days - Kshs. 132,560
  5. 5.Unpaid House Allowance (10,000x17) - Kshs. 170,000
  6. 6.Interest at Court rates on the sums awarded from the date of judgment till full payment
  7. 7.The Respondent shall bear the costs of the suit
  8. 8.The Respondent to issue the Claimant with a Certificate of Service within 30 days

Authorities

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Legislation

  • Employment Actsection 44(1)
  • Employment Actsection 45(2)
  • Employment Actsection 43
  • Employment Actsection 41
  • Employment Actsection 35
  • Employment Actsection 36
  • Employment Actsection 10(5)
  • Employment Actsection 49(1)(c), 49(3)(a), 49(4)
  • Employment Actsection 51
  • Employment and Labour Relations Court Actsection 12(3)(vii)
  • Constitution of Kenya, 2010Article 41
  • Constitution of Kenya, 2010Article 159(2)(d), Article 48
  • Public Service Commission Act
  • SCAC Act
  • Civil Procedure RulesOrder 21 Rule 1; Section 1B Civil Procedure Act

Cases cited (17)

  • National Social Security Fund vs Consumer Federation of Kenya
    Petition E003 of 2022
  • Bakery Confectionary Food Manufacturing vs Kenafric Industries
    Cause Number E867 of 2020
  • Aggrey Lukorito Wasike vs Kenya Power and Lighting Company Limited
    [2016] eKLR
  • Dakianga Distributors (K) Ltd vs Kenya Seed Company Limited
    [2015] eKLR
  • Justice Kalpana H. Rawal vs The Judicial Service Commission
    [2016] eKLR
  • IEBC & Another vs Stephen Mutinda Mule
    [2014] eKLR
  • National Bank of Kenya Limited v Hamida Bana & 103 others
    [2017] eKLR
  • State of Punjab & Others vs. Dhanjit Singh Sandu
    Civil Appeal No. 5698-5699 of 2009
  • Kenya Revenue Authority vs Menginya Salim Murgani
    Civil Appeal No. 108 of 2009
  • Judicial Service Commission Vs Gladys Boss Shollei
    Civil Appeal No. 50 of 2014
  • Eric Omondi Owino vs Kenya Film Commission
    ELC Petition E065 OF 2021
  • Nyamogo & Nyamogo Advocates vs Barclays Bank of Kenya
    Civil Appeal No. 69 of 2005
  • Daniel Toroitich Arap Moi v Mwangi Stephen and Another
    [2011] eKLR
  • CMC Aviation Limited v Mohammed Noor
    [2015] eKLR
  • Pius Machafu Isundu vs. Lavington Security Limited
  • Bakery Confectionery Food Manufacturing and Allied Workers Union (K) v Kenafric Industries Limited
    [2021] eKLR
  • Maxwell Miyawa & 7 Others v JSC
    Nakuru ELRC Petition No. 29/2016 (2017) eKLR
Jurisdiction invoked
Employment and Labour Relations Court Act, Section 12; Employment Act, 2007

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, "Mulwa v Kenya Film Commission (Employment and Labour Relations Cause E528 of 2021) [2023] KEELRC 3102 (KLR)", Case Analysis (2023). Memorandum of Claim dated 28th June 2021. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/3102/eng@2023-11-16

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