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ELRCPartially Allowed(not stated in judgment)· [2024] KEELRC 596 (KLR)

Wanyera v Central Isiolo Investment Limited (Appeal E002 of 2023) [2024] KEELRC 596 (KLR)

Employment and Labour Relations Court
8 March 2024
OMONESMUS N MAKAU
5,429 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~22 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court ruled that firing an employee on unproven accusations, without a hearing, is unfair—and a signed 'no further claims' voucher won't protect employers.

What this practically means

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Executive summary

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The appellant, employed by the respondent from 10th April 2014 as a petroleum tank driver on a monthly salary rising from Kshs. 25,000 to Kshs. 30,000, was allegedly terminated on 19th September 2020 for syphoning fuel. He sued before the Magistrate's Court at Isiolo seeking a declaration that his termination was unfair and unlawful, compensation and terminal dues. The trial court (Hon. Lucy K. Mutai, CM) found on 20th December 2022 that the claimant had not proved unfair termination and had resigned. On appeal, the ELRC at Nyeri (Onesmus N Makau, J) re-evaluated the evidence as a first appeal. The court found that the respondent had issued a last warning in August 2020 and, following an email from Vivo Energy dated 17th September 2020 complaining of the appellant's alleged fuel syphoning, dismissed him and paid him one month's salary in lieu of notice plus an extra month under a petty cash voucher marked 'full settlement and no further claims'. The court held that the voucher was not a settlement agreement capable of barring the statutory claims. Finding that the respondent never proved a valid reason - no investigation was carried out and neither an eyewitness nor the author of the email testified, rendering the allegation hearsay - and that no disciplinary hearing was accorded, the court held the termination unfair and unlawful. The appeal was allowed, the trial judgment set aside, and the appellant awarded Kshs. 504,000 (compensation of three months' salary Kshs. 90,000; leave Kshs. 42,000; house allowance Kshs. 297,000; service pay Kshs. 75,000), subject to statutory deductions, with costs of the appeal and the court below and interest at court rate. Claims for extra notice pay, overtime, rest days and baggage allowance were declined.

Key legal issues

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01

Whether the appellant resigned or was dismissed

Holding

The appellant was dismissed by the respondent, not voluntarily resigned

Reasoning

The court found it unnatural for an employee to resign without notice and demand payment of salary in lieu of notice; rather, the party offering notice pay is the one terminating. Having earlier received a last warning, the appellant was fired after the Vivo Energy email, paid one month's salary in lieu of notice, and made to sign a 'no further claims' voucher. The weight of the evidence therefore favoured dismissal.

p. 7
02

Whether the termination was unfair and unlawful

Holding

Yes - no valid reason was proved and no fair procedure (hearing) was accorded

Reasoning

The respondent, asserting resignation, never discharged the burden of proving a valid reason or procedural fairness. There was no independent investigation of the alleged fuel syphoning, no eye witness, and the author of the Vivo email was not called, rendering the allegation hearsay. The appellant's uncontroverted evidence was that he was dismissed without a hearing.

p. 9
03

Whether the petty cash voucher barred the claims

Holding

It did not - it was not a settlement agreement discharging the employer

Reasoning

The court held there was no indication the appellant discharged the employer from further claims relating to the employment contract or termination, so the voucher could not absolve the employer from the statutory claims pleaded before the court.

p. 9
04

Entitlement to reliefs

Holding

One month notice pay (already settled), 3 months' compensation, house allowance at 15% for 66 months, leave for the last two years, and service pay for five years awarded; overtime, rest days and baggage claims declined

Reasoning

The court assessed compensation at three months given five and a half years' service and prior warnings; awarded house allowance as the respondent neither housed the appellant nor paid the allowance; awarded accrued leave for two years; and granted service pay because the employer failed to substantiate its claim that the appellant refused NSSF registration.

p. 10

Legal principles established

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  • On a first appeal the court re-evaluates the evidence and draws its own conclusions, but must not introduce extraneous matters not dealt with by the parties in evidence
  • Termination of employment is unfair unless the employer proves both a valid and fair reason and a fair procedure (section 45 Employment Act)
  • Where an employer fails to prove the reasons for termination, the termination is deemed unfair (section 43(1) Employment Act)
  • The employer bears the burden of proving the factual basis of alleged misconduct and cannot fire an employee on mere allegations
  • A petty cash voucher acknowledging payment of salary dues with a 'no further claims' notation does not constitute a settlement agreement discharging the employer of statutory claims

Court orders

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  1. 1.A declaration that the termination of the Appellant's employment was unfair and unlawful
  2. 2.The respondent to pay the appellant compensation of Kshs. 90,000.00
  3. 3.The respondent to pay the appellant leave of Kshs. 42,000.00
  4. 4.The respondent to pay the appellant house allowance of Kshs. 297,000.00
  5. 5.The respondent to pay the appellant service pay of Kshs. 75,000.00 (total award Kshs. 504,000.00, subject to statutory deductions)
  6. 6.The appellant awarded costs of the appeal and the court below, with interest at court rate from the date of judgment
  7. 7.The impugned judgment of 20th December 2022 set aside and substituted with the court's orders

Authorities

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Legislation

  • Employment Actsections 28, 31, 35(1)(c), 35(1 & 5), 41, 42(1), 43, 43(1), 44(3), 44(4), 45(1 & 2), 47(5), 49(1), 74
  • Evidence Actsections 107 and 108
  • NSSF Actsection 19
  • Fair Administrative Actions Actsection 4
  • Constitution of KenyaArticles 41, 43 and 47
  • Regulation of Wages (General) OrderRule 6
  • ELRC (Procedure) RulesRule 28(3)

Cases cited (14)

  • Janet Nyandiko v Kenya Commercial Bank Ltd
    [2017] eKLR
  • Walter Ogal Anuro v Teachers Service Commission
    [2013] eKLR
  • Anthony Yamo Ihito v Basco Products (Kenya) Limited
    [2022] eKLR
  • Pius Machafu Isindu v Lavington Security Guards Limited
    [2017] eKLR
  • Robert Ngande Kathathi v Francis Kivuva Kitonde
    [2020] eKLR
  • Daniel Toroitich Arap Moi vs. Mwangi Stephen Muriithi & Another
    [2014] eKLR
  • Agatha Bugosi Said v Vegpro Kenya Limited
    [2014] eKLR
  • Clifford Sosi Nyabuto v Board of Governors - Singhsaba Nursery Primary
    [2016] eKLR
  • Edwin Beiti Kipchumba v National Bank of Kenya Limited
    [2018] eKLR
  • Postal Corporation of Kenya v Andrew K. Tanui
    [2019] eKLR
  • CMC Aviation Limited v Mohammed Noor
    [2015] eKLR
  • Kenya Ports Authority versus Kuston (Kenya) Limited
    (2009) 2EA 212
  • George Musamali versus G4S Security Services Kenya Ltd
    [2016] eKLR
  • Kenya Revenue Authority v Reuwel Waithaka Gitahi & 2 others
    [2019] eKLR
On appeal from
Magistrate's Court at Isiolo
(not stated in judgment)
Jurisdiction invoked
First appellate jurisdiction of the ELRC over an appeal from the Magistrate's Court (Employment Act claim); the court exercised its power to re-evaluate the evidence as a first appeal

Key timeline

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Practical implications

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Frequently asked questions

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Later judgments citing this (8)

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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, "Wanyera v Central Isiolo Investment Limited (Appeal E002 of 2023) [2024] KEELRC 596 (KLR)", Case Analysis (2024). (not stated in judgment). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/596/eng@2024-03-08

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