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ELRCPartially AllowedBungoma ELRC Appeal (Memorandum of Appeal dated 15th December 2020)· [2023] KEELRC 3474 (KLR)

Ace Africa (Kenya v Museve (Employment and Labour Relations Appeal E001 of 2020) [2023] KEELRC 3474 (KLR)

Environment and Labour Relations Court (Employment and Labour Relations Court), Bungoma
20 April 2023
9,603 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~38 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court confirmed an NGO worker was unfairly fired but cut his compensation to three months' salary because courts cannot reward more than what is pleaded.

What this practically means

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Executive summary

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This is a first appeal by the employer (Ace Africa (Kenya)) against the judgment of Hon. C.A.S Mutai (SPM) in Bungoma CM ELRC No. 20 of 2019, which had awarded the claimant Kshs 272,000, Kshs 54,450 in lieu of notice, a certificate of service, costs and interest following a finding of unfair termination. The appellant challenged the award of unpleaded notice pay, the compensation quantum, the withholding of a certificate of service, procedural irregularities at trial (failure to hear two of three witnesses, denial of typed proceedings and submissions, and submissions by an advocate allegedly not properly on record), and contended the claimant's admitted data fraud justified summary dismissal. The court, sitting as a first appellate court, re-evaluated the evidence. It held the trial court afforded the appellant a fair hearing: the two unheard witness statements were verbatim replicas of the testimony given, and complaints about service and submissions were afterthoughts not raised below; the defective service of the notice of change of advocates, though contrary to Order 9 rules 5 and 6, was not fatal. On the merits, the court found the termination substantively unfair because the reasons (data fraud and donor funding withdrawal) were not proved to exist at the time of termination, the donor's report being post-termination, and procedurally unfair for want of notice and hearing under sections 41(2) and 45 of the Employment Act. The award for the remainder of the contract and the notice pay were set aside as contrary to section 49(4) and unpleaded respectively, and compensation was substituted at three months' gross salary (Kshs 163,350). The certificate of service was upheld as a mandatory statutory right under section 51, and trial costs to the claimant affirmed, with no order as to costs on appeal.

Key legal issues

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01

Fair hearing of the appellant before the trial court

Holding

The trial court afforded the appellant a fair hearing. The omission of two repetitive witnesses caused no unfairness; complaints about service of submissions and typed proceedings were afterthoughts not raised below; failure to serve a notice of change of advocates filed together with submissions was not fatal.

Reasoning

The court reviewed the lower court record and found the appellant was represented throughout, was granted time to file submissions and did not utilise it. The two unheard witness statements were verbatim replicas of the testimony of DW1, adding no probative value. The notice of change was filed though served before filing; the court held the process defective but not fatal to the claimant's cause.

p. 9
02

Substantive fairness of the termination

Holding

The reasons for termination (data fraud and withdrawal of donor funding) were not proved to have existed at the time of termination; the donor's report was generated post-termination and no stipulated minimum interview time existed.

Reasoning

Under section 43 the employer must prove the reasons genuinely believed to exist at termination. The claimant had explained the shorter interviews by email; the employer adduced no evidence of a required minimum interview duration; and the donor report relied on was dated after the termination and therefore could not establish the reasons existed at the time.

p. 13
03

Procedural fairness of the termination

Holding

The termination was procedurally unfair; even in summary dismissal for gross misconduct the employer must hear the employee under section 41(2).

Reasoning

There was no evidence of a show cause letter, warning or hearing before the termination letter of 2nd July 2019. The court applied sections 41(2), 43 and 45 of the Employment Act and upheld the magistrate's finding that the dismissal was substantively and procedurally unfair.

p. 14
04

Whether the award was justified

Holding

The 6-month compensation for the remainder of contract and the notice pay were set aside; compensation substituted at 3 months' gross salary (Kshs 163,350); certificate of service upheld.

Reasoning

Section 49(4) does not permit compensation for the remainder of a contract; an employee can only be remunerated for work done. Notice pay was unpleaded and already paid. Compensation is compensatory, not punitive. Certificate of service is mandatory under section 51 and independent of clearance.

p. 15
05

Costs

Holding

Trial costs to the claimant upheld because the appellant had invited the claimant to sue before offering arbitration; the arbitration offer was an afterthought.

Reasoning

The appellant's letter of 5th August 2019 denied the claim and stated any suit would be defended; the offer to arbitrate came 13 days after the claimant indicated it would sue. Costs follow the event and the lower court's award was proper.

p. 16

Legal principles established

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  • The duty of a first appellate court is to re-evaluate the evidence of the subordinate court on both law and facts and reach its own conclusions, while making due allowance for not having seen or heard the witnesses
  • Procedural fairness under section 41 of the Employment Act is mandatory even where the employer contemplates summary dismissal for gross misconduct under section 44
  • An employer bears the burden of proving the reasons for termination existed at the time of termination; post-termination material does not satisfy section 43
  • Issuance of a certificate of service is a mandatory statutory right under section 51 of the Employment Act and cannot be withheld pending clearance by the employee
  • A court has no jurisdiction to award a party remedies outside their claim
  • A notice of change of advocates must first be filed in court before service; purported service of an unfiled notice is a nullity, though failure to serve a notice filed with other documents may not be fatal
  • A party granted an opportunity to be heard who fails to utilise it cannot later complain of denial of fair hearing; issues not raised before the trial court cannot be raised for the first time on appeal
  • The law is concerned with the quality, not the number, of witnesses

Court orders

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  1. 1.Appeal against finding of unfair termination dismissed; finding that termination was substantively and procedurally unfair upheld
  2. 2.Compensation award of Kshs 272,000 (6 months' salary for remainder of contract) set aside and substituted with compensation equivalent of three months gross salary, Kshs 163,350, subject to statutory deductions
  3. 3.Award of salary in lieu of notice (Kshs 54,450) set aside as unpleaded and already paid
  4. 4.Certificate of service to issue under section 51 of the Employment Act
  5. 5.Costs of the suit at trial court to the claimant
  6. 6.Interest at court rates from 27th November 2020 to payment in full
  7. 7.No order as to costs at appeal

Authorities

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Legislation

  • Constitution of Kenya, 2010Article 50 (fair hearing); Article 25(c) (non-derogable right to fair trial)
  • Employment Act, 2007Sections 41(2), 43, 44, 45(1),(2),(4),(5), 46, 49(1),(4),(9)(k), 50, 51
  • Civil Procedure RulesOrder 9 rules 5 and 6
  • Arbitration Actnot specified (arbitration proposal)

Cases cited (11)

  • Selle And Another v Associated Motor Boat Company Ltd & Others
    [1968] EA 123
  • David Kahuruka Gitau & Another v Nancy Ann Wathithi Gatu & Another
    Nyeri HCCA No. 43 of 2013
  • Gitobu Imanyara & Others v Attorney General
    [2016] eKLR
  • Peters v Sunday Post Ltd
    [1958] EA 424
  • Res v Sussex Justices
    [1924] 1 KB 256
  • Walter Ogaro v The Republic
  • Union Insurance Company of Kenya Ltd v Ramzan Abdul Dhanji
    Civil Application No. 179 of 1998
  • Janet Nyandiko v Kenya Commercial Bank Limited
    2017 eKLR
  • Five Forty Aviation Limited v Erwan Lanoe
    [2019] eKLR
  • Kenya Petroleum Oil Workers Union v Kenya Petroleum Refineries
    [2013] eKLR
  • Festus Munyao Makau and Steel Limited
    [2017] eKLR
On appeal from
Bungoma Chief Magistrate's Court (ELRC)
CMCC NO 20 OF 2019 (MCELRC NO. 20 OF 2019)
Jurisdiction invoked
First appellate jurisdiction over the subordinate court's decision in an employment claim (Employment Act and applicable procedure); appeal by way of retrial

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, "Ace Africa (Kenya v Museve (Employment and Labour Relations Appeal E001 of 2020) [2023] KEELRC 3474 (KLR)", Case Analysis (2023). Bungoma ELRC Appeal (Memorandum of Appeal dated 15th December 2020). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/3474/eng@2023-04-20

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