Kenya Union of Domestic Workers, Hotels, Educational Institutions And Hospital Workers Union (KUDHEIHA)) v Kima Mission Hospital (Employment and Labour Relations Cause E004 of 2023) [2024] KEELRC 1341 (KLR)
The bottom line
#Kenya's Employment Court ruled Kima Mission Hospital unfairly terminated three workers who refused new contracts, awarding them over Kshs 1.7 million plus gratuity and notice pay.
What this practically means
#Executive summary
#Key legal issues
#Whether the reason for termination (refusal to sign new contracts with Port Florence Community Hospital) was valid and fair
The reason was invalid and unfair; the respondent failed to prove that the grievants were informed of the MOU's terms, the requirement of new contracts, or the fate of their existing contracts with accrued arrears
The termination letters cited refusal to sign new contracts with Port Florence. The MOU contained no clause requiring employees to sign new contracts; it contemplated the respondent issuing termination letters at handover and staff reverting after the 10-year partnership. The employer produced no evidence of sensitisation, minutes, notice-board postings or written communications. Changing the employer's identity and terms without consultation breached section 10(5) of the Employment Act and amounted to unilateral termination of the existing contracts.
Whether the termination procedure was fair
The procedure was unfair; there were no disciplinary proceedings, no show-cause letters, and the grievants were never called to defend themselves before the joint meeting that decided their fate
Section 41 of the Employment Act requires the employer to explain the reasons and hear the employee before termination. The decision was reached at joint meetings between the Church of God and Port Florence management, with no hearing, no show-cause letters and no opportunity to make representations. The court adopted the Court of Appeal's decision in Pius Machafu Isindu on the mandatory nature of the section 41 process.
Whether the Respondent is bound by the CBA between CHAK and the Claimant
Yes; the grievants' letters of appointment stated that terms and wages for unionisable positions had been negotiated by KUDHEIHA, and the conciliator found the CBA binding, so the grievants were entitled to CBA benefits
The respondent produced no CBA of its own; the only CBA availed was the claimant's. The appointment letters, drafted by the respondent, referenced union-negotiated terms, triggering the contra proferentem rule. The conciliator's Certificate of Unresolved Issues observed the CBA was binding on the respondent. The court found the contents of the appointment letters entitled the grievants to CBA benefits including notice pay under clause 16 and service gratuity under clause 17(b).
Whether salary arrears for September 2009 to December 2012 were payable
Arrears awarded to CW1 (Kshs 244,080) and CW3 (Kshs 57,600) as tabulated; CW2's claim for that period failed as he was employed in 2016
DW admitted arrears existed and that the grievants were not paid because they were no longer employees. The respondent failed to produce evidence of payment; the cheque of Kshs 184,504 to CW1 covered 2015-2021 arrears only. The tabulation produced during conciliation set out the amounts. CW2's own statement showed he was employed in 2016 and could not have arrears from that period.
Compensation for unfair termination under section 49 of the Employment Act
Compensation awarded at 10 months for CW1 (26 years' service), 6 months for CW2 (5 years), and 8 months for CW3 (13 years)
The court applied the statutory capping under section 49, considering length of service, likelihood of securing comparable employment, and circumstances of termination. CW1's long service made re-employment unlikely, justifying 10 months. CW2 and CW3 gave no evidence of being unable to secure similar jobs, so lower awards of 6 and 8 months were made. The employer's failure to keep pay records under section 74 worked to its disadvantage.
Legal principles established
#- The burden of proving the validity of reasons for termination lies with the employer under section 43 of the Employment Act, and failure to prove the reason renders the termination unfair under section 45
- An employer cannot unilaterally alter an employee's employment contract; consultation with the employee is mandatory under section 10(5) of the Employment Act
- Procedural fairness under section 41 of the Employment Act is mandatory, requiring notification and hearing before termination, even in cases of summary dismissal
- Where an employer's appointment letter states that terms and wages for unionisable positions were negotiated by the union, the employer is estopped (contra proferentem) from denying that the applicable CBA binds it
- NSSF registration does not disentitle employees covered by a CBA providing for service gratuity, since NSSF is not equivalent to a pension/provident fund regulated under the Retirement Benefits Act
Court orders
#- 1.Award to CW1 Evans Chibinda: notice pay Kshs 106,000; salary arrears September 2009 to December 2012 Kshs 244,080; service gratuity Kshs 643,058; compensation for unfair termination Kshs 265,000 - total Kshs 1,258,138
- 2.Award to CW2 Ruphers Lumumba: notice pay Kshs 37,000; service gratuity Kshs 86,335; compensation for unfair termination Kshs 111,000 - total Kshs 234,335
- 3.Award to CW3 Fred Indanje: notice pay Kshs 40,000; salary arrears Kshs 57,600; service gratuity Kshs 121,329; compensation for unfair termination Kshs 80,000 - total Kshs 218,929
- 4.Respondent to pay Kshs 50,000 as reasonable costs to the claimant
- 5.Awarded amounts payable in 90 days, failing which they attract interest at court rates from date of judgment until payment in full
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 and the Employment and Labour Relations Court (Procedure) Rules over unfair termination claims
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kenya Union of Domestic Workers, Hotels, Educational Institutions And Hospital Workers Union (KUDHEIHA)) v Kima Mission Hospital (Employment and Labour Relations Cause E004 of 2023) [2024] KEELRC 1341 (KLR)", Case Analysis (2024). Statement of Claim dated 11th May 2023 (employment claim filed 6th June 2023). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/1341/eng@2024-06-06
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.