Skip to content
AI-generated case briefs sourced from Kenya Law · Not legal advice
AI-generated case brief
Case Brief · caselaw.co.ke
ELRCPartially AllowedCause No E543 of 2022· [2024] KEELRC 1842 (KLR)

Nzue & 3 others v Riverbank Solutions Ltd (Cause E543 of 2022) [2024] KEELRC 1842 (KLR)

Employment and Labour Relations Court
12 July 2024
4,351 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~17 min to read original · ~4 min brief

The bottom line

#

A Kenyan employment court ordered an employer to pay workers unpaid salaries and pension, and rejected its attempt to charge them notice pay.

What this practically means

#

Executive summary

#
Four former employees of the Respondent claimed unpaid salaries for mid-to-late 2020, unremitted pension deductions, general damages for mistreatment, costs and interest, alleging they resigned because of withheld pay. The Respondent admitted salary delays caused by COVID-19 business disruption, asserted that it had since settled the arrears in good faith, and counterclaimed against the 2nd and 4th Claimants for salary in lieu of the two months' notice required by their contracts, alleging their resignations fell short of contractual notice. At hearing, the 1st, 2nd and 4th Claimants quantified outstanding salaries; the 3rd Claimant confirmed all his arrears were settled. The Court first excluded the constructive dismissal argument as unpleaded, holding that parties are bound by pleadings and submissions cannot replace evidence. It found the salary claims of the 1st, 2nd and 4th Claimants proved and undisputed, awarding Kshs 15,401.20, Kshs 270,056.56 and Kshs 113,417.40 respectively with interest from filing. Only the 4th Claimant's pension remained unremitted; the Respondent was directed to pay Kshs 181,373.52 into her pension account within 30 days. General damages were declined as unpleaded and unclear. The Counterclaim was dismissed as unconscionable given the Respondent's own breaches. The Claim was allowed in part, with the Respondent bearing the costs of the Claim and the Counterclaim being disallowed with costs. Judgment was delivered at Nairobi on 12th July 2024 by Stella Rutto, Judge.

Key legal issues

#
01

Entitlement to unpaid salaries

Holding

1st, 2nd and 4th Claimants proved unpaid salaries; 3rd Claimant's arrears were settled

Reasoning

The Respondent did not dispute owing the salaries, attributing delays to COVID-19 impacts. The Claimants' testimony was supported by the evidence on record, and the Respondent had admitted settling arrears in good faith. The amounts still outstanding as admitted in testimony were awarded with interest from filing.

p. 8
02

Unremitted pension contributions

Holding

Only the 4th Claimant's pension claim remained outstanding and the Respondent was directed to remit Kshs 181,373.52

Reasoning

The Respondent did not rebut the assertion that deductions were made but not remitted. The 1st and 3rd Claimants confirmed remittance, leaving only the 4th Claimant's claim of Kshs 181,373.52 unrebutted, which the Court ordered remitted within 30 days.

p. 8
03

General damages for mistreatment

Holding

Declined as unpleaded and not flowing from the Claim

Reasoning

The relief was not clearly crafted and the Claimants had not pleaded mistreatment or unfair labour practices. Although the Respondent withheld salaries and pension remittances, the Claimants did not seek damages on that basis; the Court could not award damages outside the pleadings.

p. 8
04

Respondent's Counterclaim for notice pay

Holding

Counterclaim dismissed; unconscionable to order notice pay

Reasoning

It was common ground that the Claimants resigned while the Respondent had failed to pay salaries and remit pensions. Given those circumstances, it would be unconscionable to require the 2nd and 4th Claimants to pay salary in lieu of notice, so the Counterclaim was declined.

p. 9
05

Constructive dismissal raised in submissions

Holding

Extraneous and not considered as it was never pleaded

Reasoning

The Court noted the Claimants argued constructive dismissal extensively but had not pleaded it. Parties are bound by pleadings and submissions cannot replace evidence or pleadings; the issue therefore did not arise for consideration.

p. 7

Legal principles established

#
  • Parties are bound by their pleadings; issues not pleaded, such as constructive dismissal advanced only in submissions, cannot be considered
  • Submissions cannot take the place of evidence or pleadings
  • An employer cannot rely on COVID-19 economic hardship to indefinitely withhold earned salaries and unremitted pension deductions
  • It is unconscionable for an employer in breach of salary and pension obligations to claim salary in lieu of notice from departing employees

Court orders

#
  1. 1.The 1st Claimant is awarded Kshs 15,401.20 being outstanding salary
  2. 2.The 2nd Claimant is awarded Kshs 270,056.56 being outstanding salary
  3. 3.The 4th Claimant is awarded Kshs 113,417.40 being outstanding salary
  4. 4.The Respondent is directed to remit pension contributions of Kshs 181,373.52 to the 4th Claimant's pension account within 30 days from the date of the judgment
  5. 5.Interest at court rates on the salary awards from the date of filing the suit until payment in full
  6. 6.The Counterclaim against the 2nd and 4th Claimants is disallowed with costs
  7. 7.The Respondent shall bear the costs of the Claim

Authorities

#

Legislation

  • Employment ActNot specified
  • Civil Procedure RulesOrder 21 Rule 1
  • Constitution of KenyaArticle 159(2)(d)
  • Constitution of KenyaArticle 48
  • Civil Procedure ActSection 1B

Cases cited (4)

  • Nicodemus Ochieng Ogutu v Village of Hope Kenya
    (2018) eKLR
  • Wanjala v Gillys Security and Investigation Services Limited
    (Cause 522 of 2017) (2024) KEELRC 140 (KLR) (6 February 2024)
  • D.K. Njagi Marete v Teachers Service Commission
    (2013) eKLR
  • Hema Hospital v Wilson Makongo Marwa
    (2015) eKLR Civil Appeal No 72 of 2014
Jurisdiction invoked
Original employment and labour relations jurisdiction (Employment and Labour Relations Court)

Key timeline

#

Practical implications

#

Frequently asked questions

#

Cite this brief

#

Cite this brief

Caselaw, "Nzue & 3 others v Riverbank Solutions Ltd (Cause E543 of 2022) [2024] KEELRC 1842 (KLR)", Case Analysis (2024). Cause No E543 of 2022. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/1842/eng@2024-07-12

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