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ELRCPartially Allowed· [2024] KEELRC 2243 (KLR)

Kenya Union of Commercial, Food and Allied Workers v Bestrock Sacco Ltd (Employment and Labour Relations Cause 848 of 2019) [2024] KEELRC 2243 (KLR)

Employment and Labour Relations Court
19 September 2024
BMB. O. M. Manani
3,118 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~12 min to read original · ~4 min brief

The bottom line

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A Kenyan Sacco was ordered to pay a dismissed employee ten months' salary because it fired her for involving her trade union without holding a proper hearing.

What this practically means

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Executive summary

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The Claimant trade union challenged the Respondent Sacco's termination of the contract of its member, Rachael Mutheu (the Grievant), an accounts clerk hired in September 2014, contending she was victimised for joining the union and consulting it over workplace grievances. The Respondent maintained she was dismissed for misconduct, arrogance and insubordination. The court framed three issues: lawfulness of the termination, alleged underpayment, and entitlement to reliefs. On the first, the court found the show cause letter of 10th November 2017 and the Respondent witness's testimony revealed that the real grievance was the Grievant's involvement of her union, contrary to section 46 of the Employment Act. Procedurally, the Respondent conceded no disciplinary hearing was held; reading section 4(3) of the Fair Administrative Action Act with section 41 of the Employment Act, the court held an oral hearing is required and distinguished Kenya Revenue Authority v Menginya Salim Murgani as decided under different circumstances and pre-dating the current statutes. The termination was declared substantively and procedurally unfair. On underpayment, the court found the pleaded figure unsupported and the Grievant's own payslips and testimony showed earnings above the statutory minimum, so the claim failed. On reliefs, the court awarded compensation equivalent to ten months' gross salary and a Certificate of Service under sections 49 and 51 of the Employment Act, declined reinstatement as time-barred under section 12(3)(vii) of the ELRC Act, and allowed recovery only of actual disbursements, not Advocates Act costs, since the proceedings were not instituted by an advocate. Judgment delivered online on 19th September 2024 by B. O. M. Manani, Judge.

Key legal issues

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01

Whether the termination was substantively fair

Holding

The termination was substantively unfair because it was motivated by the Grievant's association with and use of her trade union

Reasoning

The show cause letter of 10th November 2017 and the Respondent's witness's oral evidence showed the employer was incensed that the Grievant involved her union, the Claimant, in a workplace dispute. Section 46 of the Employment Act forbids dismissal for trade union membership or participation, and no evidence supported the allegation of excessive union activity.

p. 4
02

Whether the termination was procedurally fair

Holding

The termination was procedurally unfair as the Grievant was never afforded a disciplinary hearing

Reasoning

The Respondent's witness conceded no disciplinary hearing was held. Section 4(3) of the Fair Administrative Action Act and section 41 of the Employment Act require an opportunity to be heard; the court held these provisions contemplate an oral hearing, not merely written memoranda, and declined to follow KRA v Menginya Salim Murgani as inapplicable.

p. 5
03

Whether the Grievant was underpaid

Holding

The Grievant was not underpaid

Reasoning

The pleaded figure of Kshs 13,851.00 was unsupported; the Grievant's own July 2016 payslip showed a salary of Kshs 16,067.00, above the alleged statutory minimum of Kshs 15,519.95, and she conceded in oral testimony to earning between Kshs 17,000 and Kshs 18,000.

p. 6
04

Entitlement to reliefs

Holding

Compensation of ten months' gross salary (Kshs 160,670.00 computed, ordered as Kshs 167,670.00) and a Certificate of Service were granted; reinstatement refused

Reasoning

Section 49 of the Employment Act empowers compensation for unfair termination; the court awarded ten months' gross salary based on the July 2016 salary. Section 51 entitles every departing employee to a certificate of service. Reinstatement was time-barred under section 12(3)(vii) of the ELRC Act.

p. 6

Legal principles established

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  • An employer may not terminate an employee's contract because of membership of or participation in the activities of a trade union (section 46, Employment Act).
  • Sections 4(3) of the Fair Administrative Action Act and 41(2) of the Employment Act, read together, require an oral hearing of the employee, not consideration of written representations alone.
  • Korea Revenue Authority v Menginya Salim Murgani does not apply to terminations governed by the current Employment Act and Fair Administrative Action Act.

Court orders

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  1. 1.Declaration that the Respondent unfairly terminated the services of the Grievant (termination without hearing declared procedurally unfair)
  2. 2.Finding that the Grievant was not underpaid during the term of her employment
  3. 3.Respondent ordered to pay the Grievant compensation for unfair termination in the sum of Kshs 167,670.00 (ten months' gross salary)
  4. 4.Respondent ordered to issue the Grievant with a Certificate of Service
  5. 5.Reinstatement declined as unavailable under section 12(3)(vii) of the ELRC Act, more than three years having elapsed
  6. 6.Claimant permitted to recover only actual expenses/disbursements incurred in mounting and prosecuting the claim, not costs under the Advocates Act

Authorities

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Legislation

  • Employment Actsections 41(1)(a) and (b), 42(1), 44(3) and (4), 46, 49, 51
  • Fair Administrative Action Actsection 4(3)
  • Employment and Labour Relations Court Actsection 12(3)(vii)
  • Advocates Actcosts provisions (general reference)
  • Minimum General Wage Ordergeneral reference
  • ELRC (Procedure) RulesRule 28(3)

Cases cited (1)

  • Kenya Revenue Authority v Menginya Salim Murgani
    [2010] eKLR
Jurisdiction invoked
Employment and Labour Relations Court Act, section 12 (fair termination and remedies under the Employment Act)

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, "Kenya Union of Commercial, Food and Allied Workers v Bestrock Sacco Ltd (Employment and Labour Relations Cause 848 of 2019) [2024] KEELRC 2243 (KLR)", Case Analysis (2024). . Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/2243/eng@2024-09-19

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