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ELRCPartially AllowedNot stated in the judgment (appeal lodged on 6th April, 2023 against a decision of 7th October, 2022)· [2024] KEELRC 413 (KLR)

Simba Corporation t/a Acacia Premier Hotel v Kirui (Appeal E020 of 2023) [2024] KEELRC 413 (KLR)

Employment and Labour Relations Court
29 February 2024
CBChristine N. Baari
3,590 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~14 min to read original · ~4 min brief

The bottom line

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What this practically means

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Executive summary

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This first-instance appeal to the Employment and Labour Relations Court at Kisumu challenged a decision of the Trial Court of 7th October, 2022, which found that a cashier (Respondent) had proved unfair termination by his employer (Appellant) and awarded him one month's salary in lieu of notice at Kshs. 28,100, twelve months' salary for wrongful dismissal, damages for loss of employment, and costs. The appeal, canvassed by written submissions, coalesced into two issues: whether the termination was unfair, and whether the reliefs awarded were proper. The court, applying the Selle v Associated Motor Boat Co principle of retrial on a first appeal, upheld the trial court's finding that the dismissal was procedurally flawed under Section 41 of the Employment Act because the Respondent was heard before being notified of the charges. However, the court found the Appellant had valid, fair and justified reasons for dismissal: the Respondent admitted closing bills with stale Mpesa codes and receiving cash without making reservations, causing losses; his conduct fell within the band of reasonable responses of a reasonable employer. On reliefs, the court upheld notice pay but corrected it to the contractual salary of Kshs. 16,116; reduced the 12 months' compensation to four months (Kshs. 64,464) because the Respondent contributed to his dismissal and the maximum was unexplained; set aside damages for loss of employment as unknown to Section 49; and declined the underpayment claim as unproven. The appeal was partially allowed, with the Appellant bearing half the lower court costs and each party bearing their own costs of the appeal.

Key legal issues

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01

Whether the Respondent's dismissal was procedurally fair under Section 41 of the Employment Act

Holding

The dismissal was procedurally flawed because the Respondent was heard before being notified of the charges against him.

Reasoning

Section 41 requires an employer, before terminating employment on grounds of misconduct, to explain the reasons to the employee and allow him to have a fellow employee or union representative present during the explanation. Although a show cause letter was issued and a disciplinary hearing held, the minutes showed the Respondent was heard before notification of the charges, rendering the process unlawful and the outcome unfair. The court upheld the trial court's finding of procedural flaw.

p. 5
02

Whether the Appellant had valid and fair reasons to dismiss the Respondent under Sections 43 and 45 of the Employment Act

Holding

Yes - the Respondent admitted at the hearing the reasons for his dismissal, which fell within the band of reasonable responses of a reasonable employer.

Reasoning

Section 43(2) defines the reasons for termination as matters the employer genuinely believed to exist at the time. The minutes showed the Respondent admitted closing bills using Mpesa codes without ascertaining payment and receiving cash for down payments without making reservations, causing double payments and losses. Applying the range of reasonable responses test and the balance-of-probability standard, the court found the Appellant had valid, fair and justified reasons to dismiss.

p. 6
03

Whether the reliefs awarded by the Trial Court were appropriate

Holding

Notice pay upheld but reduced to the contractual salary of Kshs. 16,116; 12 months' compensation reduced to 4 months; damages for loss of employment set aside; underpayment claim declined as unproven.

Reasoning

The contract showed a gross monthly salary of Kshs. 16,116, not Kshs. 28,100 as awarded. The maximum award of 12 months' salary lacked justification, particularly as the dismissal was for procedural flaws only and the Respondent contributed to it. Damages for loss of employment is not a Section 49 remedy. The underpayment claim failed because the pleading and evidence did not establish the period of underpayment.

p. 7

Legal principles established

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  • A first appellate court must re-evaluate, re-assess and re-analyse the evidence on record and determine whether the conclusions reached by the trial court are to stand.
  • An employee must be notified of the charges against him before being heard at a disciplinary hearing, as required by Section 41 of the Employment Act; hearing an employee before notifying him of the charges renders the process unlawful.
  • An award of the statutory maximum of 12 months' salary for wrongful dismissal must be justified; where the employee contributed to the dismissal, maximum compensation is not warranted.
  • Damages for loss of employment is not a remedy under Section 49 of the Employment Act.

Court orders

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  1. 1.The award of one-month salary in lieu of notice is upheld at Kshs. 16,116/-
  2. 2.The award of 12 months' salary is set aside and substituted with 4 months salary for wrongful dismissal at Kshs. 64,464/-
  3. 3.The award of damages for loss of employment is set aside in its entirety
  4. 4.The claim for underpayment is declined
  5. 5.The Appellant shall bear half the costs of the suit before the Lower Court
  6. 6.Parties shall bear their own costs of the appeal

Authorities

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Legislation

  • Employment ActSection 41
  • Employment ActSection 43
  • Employment ActSection 43(2)
  • Employment ActSection 45
  • Employment ActSection 44
  • Employment ActSection 47
  • Employment ActSection 47(5)
  • Employment ActSections 49 and 50

Cases cited (9)

  • Lawrence Nyamichaba Ondari v National Hospital Insurance Fund
    [2018] eKLR (Nairobi ELRC Cause No 1212 of 2014)
  • Anytime Limited v Fredrick Mutobera Omuraya
    [2022] eKLR
  • Selle & Another vs Associated Motor Boat Co Ltd
    (1968) EA 123
  • Loice Otieno v. Kenya Commercial Bank Limited
    Cause No. 1050 of 2011
  • Charles Musungu Odana v Kenya Ports Authority
    [2019] eKLR
  • Reuben Ikatwa & 17 Others v Commanding Officer British Army Training Unit Kenya & Another
    [2017] eKLR
  • Kenya Revenue Authority v Reuwel Waithaka Gitahi & 2 others
    [2019] eKLR (Civil Appeal No 66A of 2017)
  • Moi Teaching and Referral Hospital v James Kipkonga Kendagor
    [2019] eKLR
  • Kenya Broadcasting Corporation v Geoffrey Wakio
    [2019] eKLR
On appeal from
Trial Court (magistrates' court - employment cause)
Not stated
Jurisdiction invoked
First appellate jurisdiction over the decision of the Trial Court in an employment dispute

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, "Simba Corporation t/a Acacia Premier Hotel v Kirui (Appeal E020 of 2023) [2024] KEELRC 413 (KLR)", Case Analysis (2024). Not stated in the judgment (appeal lodged on 6th April, 2023 against a decision of 7th October, 2022). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/413/eng@2024-02-29

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