Nthiga v Mundigi, MP (Cause E009 of 2023) [2024] KEELRC 1900 (KLR)
The bottom line
#Kenya's Employment Court ruled that even a valid reason for firing isn't enough—employers must also state the reason and give the employee a hearing before termination.
What this practically means
#Executive summary
#Key legal issues
#Court jurisdiction versus the arbitration clause in the employment contract
The court had jurisdiction because the respondent never filed a formal application under section 6(1) of the Arbitration Act to stay the proceedings, and instead took steps in the proceedings.
Jurisdiction is conferred by Article 162(2)(a) and section 12 of the ELRC Act. Section 6(1) of the Arbitration Act mandates a stay only where a party applies not later than entry of appearance or filing of pleadings. The respondent only pleaded the arbitration clause in its defence without filing an application for stay, thereby submitting to the court's jurisdiction. The court also found the parties had abandoned the arbitration agreement.
Whether the termination was substantively justified
Yes - the claimant's absence from work and failure to answer calls, causing the respondent to miss an official trip to Italy, constituted a valid reason for termination.
The claimant admitted he did not report to work on the morning of 6th February 2023 and had his phone on silent mode. The consequence was the respondent's loss of an official trip to Italy. This conduct was related to the employee's conduct and capacity and warranted summary dismissal under section 44 of the Employment Act.
Whether the termination was procedurally fair
No - the respondent failed to cite a reason or accord the claimant a hearing, contrary to sections 41 and 45(2)(c) of the Employment Act.
The respondent admitted in cross-examination that the termination letter did not state a reason and that no hearing or written warning was given. Although he paid one month's salary in lieu of notice, compliance with the contract did not displace the statutory requirement to explain the grounds and hear the employee before termination.
Remedies for unfair termination
The claimant was awarded one month's salary as compensation, gratuity of Kshs. 372,000 for the six months served, pro rata leave of Kshs. 76,666.66, a declaration, costs and interest; pay in lieu of notice was refused as already paid.
Compensation was limited to one month's salary given the short service of six months and the claimant's contributory misconduct. Gratuity was payable under clause 7 of the contract for termination under clause 5(1), calculated at 31% of salary for the period served. Leave was computed pro rata at 21 days per year for six months.
Legal principles established
#- A party who does not apply under section 6(1) of the Arbitration Act within the prescribed time submits to the court's jurisdiction notwithstanding an arbitration clause.
- Termination must be both substantively justified and procedurally fair under sections 41, 43, 45 and 47(5) of the Employment Act.
Court orders
#- 1.Declaration that the termination of the claimant's contract of employment was unfair and unlawful.
- 2.Respondent to pay the claimant compensation of Kshs. 200,000.00, gratuity of Kshs. 372,000.00 and leave of Kshs. 76,666.66, totalling Kshs. 648,666.66.
- 3.Respondent to pay costs of the suit plus interest at court rates from the date of the judgment.
- 4.The award of damages is subject to statutory deductions.
- Jurisdiction invoked
- Article 162(2)(a) of the Constitution and section 12 of the Employment and Labour Relations Court Act
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Nthiga v Mundigi, MP (Cause E009 of 2023) [2024] KEELRC 1900 (KLR)", Case Analysis (2024). Cause No E009 of 2023. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/1900/eng@2024-07-19
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.