Bernd v Bahari Dhow Limited & another (Cause E123 of 2023) [2024] KEELRC 1556 (KLR)
The bottom line
#A Kenyan court ruled a hotel manager's dismissal for poor performance was unfair because his employer never warned him formally or gave him a chance to improve.
What this practically means
#Executive summary
#Key legal issues
#Whether termination for poor performance was procedurally fair
Termination was unfair under Sections 41, 43 and 45 of the Employment Act
Poor performance terminations require the employer to explain the reasons, hold a disciplinary hearing with notice, and allow the employee an opportunity to improve over a reasonable period of 2-3 months. The meeting on 4 July 2023 was not notified as a disciplinary hearing and no chance to improve was given, so neither procedural validity nor valid reasons were established.
Status of employment after expiry of the 2-year fixed-term contract
Continuous engagement after lapse of the written contract converted the claimant to an employee protected under Section 37
The written contract lapsed on 28 October 2020 but the claimant worked continuously until July 2023. The respondents, bearing the statutory duty under Section 10(6) and (7) to keep records, filed none showing renewal, so the 32-month period is protected under Section 37.
Entitlement to service pay
Service pay refused because the claimant was covered by a pension scheme under the contract
Section 35(6) excludes employees who are members of registered pension schemes or NSSF from service pay. Clause 8 of the contract secured the claimant under pension and medical schemes, removing him from service pay entitlement despite the respondents' failure to remit NSSF.
Quantification of leave pay
Leave accrual limited to 18 months under Section 28(4), yielding 33 days at Ksh. 145,574
Unlimited accumulation of leave is not permitted; absent employer permission, leave must be taken when due and only 18 months of accrued leave can be claimed. With 21 days per year for 18 months the claimant earned 33 leave days.
Withheld company laptop
Ksh. 227,000 deducted from terminal dues for the unreturned computer
The claimant admitted withholding the respondent's laptop and offered to return it after over a year, which the court found unjustified. In the absence of a receipt, the earlier pleaded value of Ksh. 227,000 was applied and set off under Section 19 of the Act.
Legal principles established
#- Termination for poor performance requires the employer to point out shortcomings and give the employee an opportunity to improve over a reasonable time, and to conduct a hearing under Section 41
- Statutory deductions cannot be circumvented by private agreement between employer and employee; absence of remittance to NSSF entitles the employee to service pay
- Where an employer fails to file work records and the employee serves continuously beyond an expired fixed-term contract, the employee is deemed protected under Section 37
Court orders
#- 1.Compensation Ksh. 397,020
- 2.Notice pay Ksh. 132,340
- 3.Leave pay Ksh. 145,574
- 4.Certificate of service to be issued under Section 51 of the Employment Act, 2007
- 5.Dues (a), (b) and (c) to be paid less Ksh. 227,000 value for the computer withheld by the claimant
- 6.Each party bears its costs
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 (first-instance employment claim)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Bernd v Bahari Dhow Limited & another (Cause E123 of 2023) [2024] KEELRC 1556 (KLR)", Case Analysis (2024). Not stated in judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/1556/eng@2024-06-13
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.