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ELRCPartially AllowedMombasa ELRC Appeal arising from Mombasa CMELRC No. E121 of 2020· [2024] KEELRC 1471 (KLR)

Truckers Paradise Limited v Kilunda (Appeal E146 of 2023) [2024] KEELRC 1471 (KLR)

Employment and Labour Relations Court
20 March 2024
MMM. Mbarũ
1,610 words in judgment
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The bottom line

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A Mombasa court cut a petrol pump attendant's compensation but confirmed Kenyan employers must follow Section 41's disciplinary process, even for real misconduct.

What this practically means

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Executive summary

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This is a first appeal to the Employment and Labour Relations Court at Mombasa against the judgment of the trial court (Mombasa CMELRC No. E121 of 2020, delivered 6 December 2022), which found the respondent's employment as a pump attendant unfairly terminated and awarded him compensation of Kshs. 100,000 (stated as 10 months), notice pay of Kshs. 20,200, leave pay of Kshs. 1,347, a certificate of service, and costs. The appellant contended that the compensation award lacked reasons and was not commensurate with the respondent's gross wage of Kshs. 20,200, and that notice and leave pay were unjustified in a summary dismissal for gross misconduct. The court, per M. Mbarũ J, re-evaluated the record as a first appellate court. It upheld the finding of unfair termination: the disciplinary hearing notice dated 25 September 2020 failed the mandatory requirements of Section 41 of the Employment Act because the respondent was not advised to bring another employee of his choice. However, the compensation award was excessive and unexplained; discretion under Section 49 must be exercised judicially, based on the employee's gross wage and record, including his misconduct and same-day warning letter. Compensation was reduced to 3 months' gross wage at Kshs. 60,600. Notice pay of Kshs. 20,200 was retained for the lapse in due process, leave pay of Kshs. 1,347 was confirmed, and a certificate of service is to issue upon clearance. The appeal partially succeeded, with each party bearing its own costs of the appeal.

Key legal issues

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01

Fairness of the termination process

Holding

The finding of unfair termination was upheld; the disciplinary hearing notice failed the Section 41 threshold.

Reasoning

Section 41 of the Employment Act requires the employee to be informed of the allegations and to make representations in the presence of another employee of his choice. The notice to attend the disciplinary hearing dated 25 September 2020 did not advise the respondent to bring a fellow employee, breaching a mandatory provision, so the termination was procedurally unfair despite the misconduct.

p. 3
02

Quantum of compensation under Section 49

Holding

The 10-month award was excessive and unexplained; reduced to 3 months' gross wage (Kshs. 60,600).

Reasoning

Section 49 confers discretion capped at 12 months' gross wage, but the discretion must be exercised judicially with reasons. The award must be commensurate with the employee's gross wage (Kshs. 20,200 per month) and account for the employee's record, including his misconduct and warning letter, the lapse being procedural only.

p. 4
03

Notice pay and leave pay

Holding

Notice pay of Kshs. 20,200 due for the lapse in due process; leave pay of Kshs. 1,347 properly assessed.

Reasoning

Although the appellant argued summary dismissal precluded notice pay, the termination was effected under Section 41 rather than Section 44, and due process having failed, notice pay is due. The leave assessment was not faulted.

p. 4

Legal principles established

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  • Whatever the reasons for termination, the employee must be taken through the mandatory process under Section 41 of the Employment Act, including the right to be accompanied by another employee of choice.
  • An award of compensation must be for given reasons; the trial court's discretion is judicial and must be justified.
  • Compensation must be computed on the employee's gross wage and be commensurate with it.

Court orders

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  1. 1.Compensation Kshs. 60,600
  2. 2.Notice pay Kshs. 20,200
  3. 3.Leave Kshs. 1,347
  4. 4.Certificate of service to be issued upon clearance
  5. 5.Each party to bear the costs of the appeal

Authorities

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Legislation

  • Employment Act, 2007Section 44(1)
  • Employment Act, 2007Section 44
  • Employment Act, 2007Section 41
  • Employment Act, 2007Section 41(2)
  • Employment Act, 2007Section 45(5)
  • Employment Act, 2007Section 49
  • Employment Act, 2007Section 49(2)
  • Employment Act, 2007Section 51
  • Employment and Labour Relations Court Act, 2011Section 12(4)

Cases cited (6)

  • Postal Corporation of Kenya v Andrew K Tanui
    [2019] eKLR
  • Kenfreight (E.A) Limited v Benson K. Nguti
    [2019] eKLR
  • Kenya Union of Commercial Food and Allied Workers v Meru North Farmers Sacco Limited
    Cause No. 74 of 2013
  • Gas Kenya Limited v Odhiambo
    (Appeal E006 of 2022) [2022]
  • Kenya Broadcasting Corporation v Geofirey Wakio
    [2019] eKLR
  • Ol Pejeta Ranching Limited v David Wanjau Muhoro
    Civil Appeal No 42 of 2015
On appeal from
Employment and Labour Relations Court (Mombasa CMELRC, magistracy)
Mombasa CMELRC No. E121 of 2020
Jurisdiction invoked
First appeal from the trial court in employment and labour relations matter (ELRC appellate jurisdiction)

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, "Truckers Paradise Limited v Kilunda (Appeal E146 of 2023) [2024] KEELRC 1471 (KLR)", Case Analysis (2024). Mombasa ELRC Appeal arising from Mombasa CMELRC No. E121 of 2020. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/1471/eng@2024-03-20

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