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ELRCPartially AllowedNot stated in judgment· [2024] KEELRC 1312 (KLR)

Kenyanya v Shajanand Holdings Ltd (Appeal E024 of 2023) [2024] KEELRC 1312 (KLR)

Employment and Labour Relations Court
29 May 2024
1,143 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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A Kenyan court confirmed that employers who lose or never issue written contracts bear the burden of proving employment terms, and can be penalised for unfair dismissal.

What this practically means

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Executive summary

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The Appellant appealed to the Employment and Labour Relations Court at Kisumu against a judgment of the Principal Magistrate's Court at Winam delivered on 31 March 2023 dismissing his claim for unfair termination and breach of contract on the ground that he had not established an employment relationship with the Respondent. On the well-established duty of a first appellate court to re-evaluate the evidence, the Court held that the trial magistrate erred: under sections 9(2) and 10(7) of the Employment Act the burden of producing a written contract rests on the employer, and on failure the court may rely on secondary evidence. The Appellant's NSSF Statement of Account showing him as an employee of the Respondent sufficed. On unfair termination, the Court found the Respondent, a monthly-paid employee's employer, gave no 28-day written notice under section 35(1)(c) and took the Appellant through no hearing under section 41, and led no evidence at trial. The Court set aside the magistrate's judgment and substituted a finding of employment and unfair termination, awarding compensation of seven months' gross wages (Kshs 91,000/-) and one month's pay in lieu of notice (Kshs 13,000/-), totalling Kshs 104,000/-. The accrued leave claim failed for want of evidential foundation. Costs of the appeal were denied to the Appellant for late filing of submissions, but costs before the Subordinate Court were awarded to him. Judgment delivered virtually and signed in Kisumu on 29 May 2024 by Radido Stephen, J.

Key legal issues

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01

Employment relationship without a written contract

Holding

The Principal Magistrate erred in finding no employment relationship; the NSSF Statement of Account was sufficient secondary evidence of employment

Reasoning

Section 9(2) of the Employment Act obliges the employer to prepare and have the contract signed, and section 10(7) places the burden of producing the contract in proceedings on the employer. On failure, the burden shifts to the employer to disprove employment. The NSSF statement showing the Appellant as an employee of the Respondent was unchallenged secondary evidence sufficient to establish the relationship.

p. 3
02

Unfair termination

Holding

Termination was unfair: no written notice under section 35(1)(c) and no hearing under section 41; the Respondent led no evidence

Reasoning

The Appellant, paid monthly, was entitled to at least 28 days' written notice under section 35(1)(c) and to notification of reasons and an opportunity to be heard under section 41. The Respondent adduced no evidence at trial to demonstrate compliance with either requirement, so the termination of 6 February 2021 was substantively and procedurally unfair.

p. 3
03

Quantum of compensation

Holding

Seven months' gross wages (Kshs 91,000/-) as compensation for unfair termination, plus one month's notice pay (Kshs 13,000/-)

Reasoning

The Appellant's uncontroverted testimony was that he served from 2014 to 2021 earning Kshs 13,000/- monthly. Considering the length of service, the equivalent of seven months' gross wages was just and appropriate. Accrued leave was not awarded for want of evidential foundation.

p. 3

Legal principles established

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  • A first appellate court must re-evaluate, re-assess and reanalyse the evidence on the record and determine whether the conclusions of the trial court should stand
  • Where the employer fails to produce a written employment contract as required by sections 9(2) and 10(7) of the Employment Act, the burden shifts to the employer to disprove the existence and terms of the employment, and the court may rely on secondary evidence to infer an employment relationship

Court orders

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  1. 1.Judgment of the Principal Magistrate set aside and substituted with a finding that the Appellant was an employee of the Respondent and that his employment was unfairly terminated
  2. 2.Award of compensation equivalent to 7 months' gross wages of Kshs 91,000/-
  3. 3.Award of pay in lieu of notice of Kshs 13,000/- (total Kshs 104,000/-)
  4. 4.Claim for accrued leave declined
  5. 5.No costs of the appeal to the Appellant (for late filing of submissions), but costs before the Subordinate Court awarded to the Appellant
On appeal from
Principal Magistrates Court at Winam
Not stated in judgment
Jurisdiction invoked
First appellate jurisdiction of the Employment and Labour Relations Court over the subordinate court ( Memorandum of Appeal filed in the ELRC)

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, "Kenyanya v Shajanand Holdings Ltd (Appeal E024 of 2023) [2024] KEELRC 1312 (KLR)", Case Analysis (2024). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/1312/eng@2024-05-29

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