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ELRCPartially AllowedNot stated in the judgment· [2024] KEELRC 1097 (KLR)

Njue v Masaku & another (Employment and Labour Relations Appeal E010 of 2023) [2024] KEELRC 1097 (KLR)

Employment and Labour Relations Court
15 May 2024
2,107 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan employer must pay an employee's full salary during suspension unless it has quantified claims and a legal basis to withhold it.

What this practically means

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Executive summary

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This is a first appeal from the Chief Magistrate's Court, decided by Onsmus N Makau J of the Employment and Labour Relations Court at Nyeri on 15 May 2024. The appellant, an accounts clerk employed from 28 February 2005, was suspended indefinitely on 18 January 2021 without salary, though her statutory deductions were remitted. The trial court (Hon. Otieno SRM) found the indefinite suspension amounted to constructive and unfair dismissal and awarded notice pay, eight months' compensation and salary for June, July and August 2020, totalling Kshs. 331,296. The appellant appealed, contending the trial court ignored her claims for salary withheld from January 2021 to January 2022 and for retirement benefits. On appeal, the court found the trial judgment was silent on those two prayers despite evidence existing on record, an omission it characterised as an abdication of judicial duty. The respondents' defence that the Board advised withholding salary to recover unauthorised increments paid to other staff failed: no Board minutes were produced, the sums were unquantified, there was no counterclaim, and the appellant had been cleared of the allegations. The court awarded Kshs. 358,904 for the suspension-period salary less statutory deductions. The pension claim failed for want of evidence, but the court held she was entitled to her NSSF retirement benefits. The appeal was allowed, the impugned judgment set aside and substituted with an award of Kshs. 690,200, NSSF benefits, costs of the appeal and the lower-court suit, and interest at court rates.

Key legal issues

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01

Entitlement to salary withheld during the suspension period (January 2021 to January 2022)

Holding

The appellant was entitled to the full withheld salary of Kshs. 358,904 less statutory deductions

Reasoning

The appellant testified she was unpaid during suspension while statutory deductions were remitted, and defence witnesses admitted non-payment justified by a Board resolution to recover unauthorised salary increments from her. No minutes of the Board were produced; recovery should have been directed to employees who received the increments; the sums were unquantified; there was no counterclaim; and the appellant had been cleared of the allegations, leaving the recovery without legal basis.

p. 5
02

Entitlement to retirement benefits

Holding

No pension was proved, but the appellant is entitled to her NSSF retirement benefits

Reasoning

The court found no evidence supporting a claim to pension under the Pensions Act, so the appellant's submissions on that point failed. However, since the appellant was registered with the NSSF and the employer remitted contributions regularly even during the salary withholding, she was held entitled to payment of retirement benefits under the NSSF Fund rules and regulations.

p. 5
03

Duty of the trial court to determine all prayers before it

Holding

The trial court erred by failing to determine the claims for the withheld suspension salary and retirement benefits

Reasoning

The impugned judgment was silent on the prayer for salary for the suspension period and on the prayer for retirement benefits, even though evidence existed on both. The court on appeal held that a trial court must consider every claim and either reject or grant it with reasons, and the omission constituted an abdication of judicial duty, justifying appellate intervention.

p. 4
04

Unchallenged findings of unfair termination

Holding

The finding of unfair termination and the awards of notice pay, compensation and June–August 2020 salary stood unchallenged

Reasoning

The appeal did not challenge the trial court's holding that the indefinite suspension amounted to constructive and unfair dismissal, nor the awards for notice, compensation and salary for June, July and August 2020. The only issues falling for determination were the suspension-period salary and retirement benefits, which the appellate court determined afresh on the evidence.

p. 4

Legal principles established

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  • A trial court must consider every claim before it and either grant or reject it with reasons; silence amounts to abdication of judicial duty
  • On a first appeal, the court re-evaluates the evidence and makes its own independent conclusions
  • An employer may not withhold an employee's salary to recover unquantified sums allegedly owed to other employees without a counterclaim or legal basis

Court orders

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  1. 1.Notice pay of Kshs. 27,608.00
  2. 2.Compensation for unfair termination of Kshs. 220,864.00
  3. 3.Salary for June, July and August 2020 of Kshs. 82,824.00
  4. 4.Salary for January 2021 to January 2022 of Kshs. 358,904.00 less statutory deductions (total award Kshs. 690,200.00)
  5. 5.Payment of retirement benefits by the NSSF under the Fund Rules and regulations
  6. 6.Costs of the appeal and the suit in the lower court to the appellant
  7. 7.Interest at court rates from the date of the judgment

Authorities

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Legislation

  • Employment Actsection 45
  • Employment Actsection 49
  • Pensions Actsection 5
  • Evidence Actsections 107 & 108
  • ELRC Procedure RulesRule 28(3)

Cases cited (5)

  • Josephine M. Ndungu & Others v Plan International Inc
    [2019] eKLR
  • Peter Otabong Ekisa v County Government of Busia
    [2017] eKLR
  • Anne Wambui Ndiritu v Joseph Kiprono Ropkoi & another
    [2005] 1 EA 334
  • Kenya Power & Lighting Company Limited v Aggrey Lukorito Wasike
    [2017] eKLR
  • Kenya Ports Authority v Kuston (Kenya) Limited
    [2009] 2 EA 212
On appeal from
Chief Magistrate's Court
Not stated
Jurisdiction invoked
First appellate jurisdiction of the Employment and Labour Relations Court over an appeal from the Chief Magistrate's Court

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, "Njue v Masaku & another (Employment and Labour Relations Appeal E010 of 2023) [2024] KEELRC 1097 (KLR)", Case Analysis (2024). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/1097/eng@2024-05-15

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