Ngatia v Wonder Feeds Limited (Cause 331 of 2015) [2024] KEELRC 295 (KLR)
The bottom line
#A Kenyan court ruled that firing an employee without a valid reason and a fair hearing is unlawful, even if the contract says otherwise.
What this practically means
#Executive summary
#Key legal issues
#Nature and terms of the employment relationship
The claimant was, at the time of termination, a permanent and pensionable employee, having been confirmed as such by letter dated 24th June 2014 and appointed on permanent and pensionable terms by letter dated 1st July 2013.
The court defined a casual employee under section 2 of the Employment Act and applied section 37(1), which deems continuous engagement beyond the statutory period to convert casual employment to monthly terms. The claimant's early fixed-term contracts were renewed until he was confirmed as a permanent employee, with the 1st July 2013 letter setting basic pay of Kshs.9,565, house allowance of Kshs.1,435, gross pay Kshs.11,000. That contract governed until termination.
Whether the termination was unfair and unlawful
The termination was unfair and unlawful for want of both substantive and procedural fairness under sections 41 and 43 of the Employment Act.
The theft allegations against the claimant were found baseless and the respondent had compensated him Kshs.40,000 for the mistreatment. The termination letter gave no reason, stating the reasons were 'best known to yourself', and the claimant was never invited to any disciplinary hearing. The court declared the offending contract term null and void and held that no employee may be terminated without a valid reason and a fair hearing.
Entitlement to reliefs and limitation
Underpayments of Kshs.15,167.20 and maximum compensation of Kshs.139,303 were awarded; leave and gratuity claims and claims predating 1st September 2012 were dismissed as time-barred or unfounded.
Section 90 imposes a three-year limitation, so only claims from 1st September 2012 could be considered. Comparing the claimant's pay against LN 71 of 2012 and LN 197 of 2013 minimum wages, underpayments of Kshs.15,167.20 were established. Leave pay for 2006 to 2012 was time-barred; gratuity was not contractually provided nor voluntary. Maximum compensation of 12 months' gross pay was justified by the long service, denial of fair hearing and failure to settle terminal dues.
Legal principles established
#- A contract term permitting termination 'without giving any reason' is void as it is contrary to the statutory requirements of substantive and procedural fairness
- For a termination to pass the fairness test there must be both substantive justification and procedural fairness
- A casual employee engaged continuously beyond the statutory period is deemed converted to monthly/permanent terms under section 37(1) of the Employment Act
- Employment claims must be filed within three years of the cause of action under section 90 of the Employment Act
Court orders
#- 1.A declaration be and is hereby made that the termination of the claimant by the respondent was unfair and unlawful.
- 2.Underpayments awarded in the sum of Kshs.15,167.20
- 3.Compensation for unfair termination awarded in the sum of Kshs.139,303.00 (total Kshs.154,470.20)
- 4.The claimant is awarded costs of the cause and interest
- 5.All the other claims are denied and dismissed
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under the Employment Act and related labour laws
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Ngatia v Wonder Feeds Limited (Cause 331 of 2015) [2024] KEELRC 295 (KLR)", Case Analysis (2024). Cause No 331 of 2015. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/295/eng@2024-02-15
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.