Preissler & another v Daluga Investment Limited t/a Easygym Kenya & 2 others (Cause 309 of 2020) [2024] KEELRC 473 (KLR)
The bottom line
#A Kenyan court ruled an executive's dismissal unfair because his employer acted as accuser, judge and prosecutor in its own disciplinary hearing.
What this practically means
#Executive summary
#Key legal issues
#Employment versus consultancy relationship
The 1st Claimant was an employee of the 1st Respondent and a consultant of the 3rd Respondent under two intertwined but distinct agreements
The court examined the two agreements dated 1st/19th September 2019 and applied the Employment Act definitions of employee and contract of service, noting the statutes make no provision for consultants. It found the employment contract and consultancy agreement were intertwined, one terminating upon the other, but that the claimant stood in an employer-employee relationship with the 1st Respondent and a consultancy relationship with the 3rd Respondent.
Substantive justification for termination
The employer had a valid reason: the claimant terminated the consultancy agreement and left the workplace abruptly without agreement
Under Sections 43(2), 45 and 47(5) of the Employment Act the burden of justifying termination rests on the employer. The claimant admitted he suspended the consultancy agreement for non-payment, and the employment contract automatically terminated upon termination of the consultancy agreement. He also left Kenya abruptly without mutual agreement with the employer. On a balance of probabilities a valid reason was shown.
Procedural fairness of the termination
The summary dismissal was procedurally unfair: the disciplinary panel comprised the 2nd Respondent alone, and no minutes of the hearing were produced
Section 41 of the Employment Act prescribes mandatory procedural components including notification, hearing, accompaniment and consideration of representations. Although the claimant attended a hearing, the panel was constituted by the 2nd Respondent alone - the accuser, witness, prosecutor and judge - lacking independence. The employer also failed to file minutes of the hearing, so could not discharge its burden under Section 45(2).
Quantum of compensation
Two months' gross salary (USD 3,000) was fair compensation under Section 49(1)(c)
The court considered the short duration of employment (about 7 months), the absence of recorded misconduct or warnings, the claimant's substantial contribution to his own termination, and his failure to seek reinstatement or appeal the decision. These Section 49 factors led the court to award the equivalent of two months' salary rather than the 12 months claimed.
Legal principles established
#- A disciplinary panel constituted by the accuser alone, who is also complainant, witness, prosecutor and decision-maker, lacks the independence and diversity required for a fair hearing
- Failure by an employer to produce minutes of a disciplinary hearing deprives the court of evidence of compliance with procedural requirements under Section 41 of the Employment Act
- Unfair termination requires both substantive justification and procedural fairness; absence of either renders the termination unfair under Section 45 of the Employment Act
Court orders
#- 1.Declaration that termination of the 1st Claimant's employment was unfair
- 2.Award of salary for January, March and April 2020 of USD 4,500
- 3.Award of equivalent of two months' gross salary (USD 3,000) as compensation under Section 49(1)(c) of the Employment Act
- 4.Costs of the suit to the 1st Claimant
- 5.Interest at court rates from date of judgment till payment in full
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 (unfair termination claim)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Preissler & another v Daluga Investment Limited t/a Easygym Kenya & 2 others (Cause 309 of 2020) [2024] KEELRC 473 (KLR)", Case Analysis (2024). Employment and Labour Relations Court Claim dated 2nd June 2020, amended 4th November 2021. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/473/eng@2024-03-04
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.