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ELRCPartially AllowedCause No 2 of 2022· [2024] KEELRC 2604 (KLR)

Murimi v Mini Bakeries (Nairobi) Limited (Cause 2 of 2022) [2024] KEELRC 2604 (KLR)

Employment and Labour Relations Court
24 October 2024
5,544 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~22 min to read original · ~4 min brief

The bottom line

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What this practically means

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Executive summary

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The Claimant, an Assistant Operations Manager, sued the Respondent for unfair and unlawful termination following a show cause letter dated 23rd May 2019 and a termination letter dated 6th June 2019, seeking a declaration of unfair termination and terminal benefits of Kshs 4,364,300.28. The Respondent maintained the termination was for gross misconduct (negligence leading to embezzlement at the Machakos branch) and followed due process under the Employment Act. The court framed four issues: date of employment, validity of reason, procedural fairness, and reliefs. On the first issue, relying on NSSF records and 2008 confirmation letters and the employer's statutory duty to keep records under sections 74 and 10 of the Employment Act, the court found the Claimant was employed orally in 1997. On substantive fairness, the court found the reasons in the termination letter differed from those in the show cause letter, that the Claimant never responded to the termination grounds, that he did not personally participate in the fraud, and that his contract did not outline his duties; the termination therefore lacked valid reason. However, the disciplinary process itself satisfied section 41, so procedure was fair. On remedies, the court granted the declaration, one month's notice pay (Kshs 159,265), 96 days' leave pay (Kshs 600,204.40), refund of unlawful 35% deductions (Kshs 75,832), and 10 months' salary compensation. Salary arrears and leave travelling allowance were refused, and the claim for 12 months' compensation was reduced. Costs and interest from judgment were awarded to the Claimant. Note: the compensation figure is internally inconsistent (Kshs 1,911,180 in reasoning versus Kshs 1,592,650 in the summary of awards).

Key legal issues

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01

Date of commencement of employment

Holding

The Claimant was employed by the Respondent in 1997 orally, before the contract was reduced to writing in 2008 and 2011

Reasoning

The court considered the appointment and confirmation letters of 2008 issued by the Respondent's sister company by the Respondent's own Legal and Administration Manager, and the NSSF records showing contributions by Mini Bakeries from 2001. The Respondent produced no evidence rebutting the Claimant's averment, and under sections 74 and 10(6) and (7) of the Employment Act the burden of keeping and producing employment records lies on the employer.

p. 5
02

Whether there was valid reason for termination

Holding

The termination was without valid reason and therefore unfair

Reasoning

The show cause letter and the termination letter advanced different grounds, and the reasons in the termination letter were never put to the Claimant. The Respondent's own witness admitted the Claimant did not participate in the embezzlement, that his juniors who committed it had been terminated, and that the audit found the Respondent's systems weak. The contract did not specifically outline the Claimant's duties, so the negligence ground failed the valid reason test under sections 43 and 45.

p. 10
03

Whether fair procedure was followed

Holding

The Respondent followed fair procedure under section 41 of the Employment Act

Reasoning

The Claimant was issued with a notice to show cause, given adequate time to respond, and given adequate notice to attend a disciplinary hearing where he appeared with a colleague of his choice. The court found this satisfied the procedural requirements of section 41 and section 45(2)(c), so only the substantive fairness limb failed.

p. 10
04

Remedies for unfair termination

Holding

Notice pay for one month, 96 days' leave pay, refund of unlawful deductions, and 10 months' salary compensation were awarded

Reasoning

Having served over 10 years, the Claimant was entitled to 3 months' notice pay, of which two months had been paid. The Respondent's leave form showing an amended balance of 12 days did not tally with its own figures, supporting 96 unpaid leave days. The 35% deduction for alleged losses had no justification. Considering section 49(4) factors and over 20 years of service, 10 months' compensation was awarded instead of the 12 sought.

p. 12

Legal principles established

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  • The employer bears the burden of proving the reason or reasons for termination, and where it fails to do so, the termination is deemed unfair
  • Where an employer fails to keep employment records, the burden of disproving the employee's averments as to terms and duration of employment lies on the employer
  • An employee cannot be compelled to take leave during terminal notice so as to defeat the right to be paid in lieu of leave
  • Grounds for termination not raised in the show cause letter, on which the employee was never heard, cannot sustain a lawful termination

Court orders

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  1. 1.Declaration that the termination of the Claimant's employment was unfair and unlawful
  2. 2.Payment of 1 month's salary in lieu of notice of Kshs 159,265
  3. 3.Payment in lieu of annual leave not taken of Kshs 600,204.40
  4. 4.Refund of the 35% deductions of Kshs 75,832.00
  5. 5.Compensation of 10 months' salary of Kshs 1,592,650 for unfair termination
  6. 6.Respondent to pay the Claimant's costs
  7. 7.Interest at court rates from the date of judgment

Authorities

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Legislation

  • Employment Actsection 41
  • Employment Actsection 42(1)
  • Employment Actsection 43
  • Employment Actsection 44(3) and (4)
  • Employment Actsection 45(2)(c)
  • Employment Actsection 47(5)
  • Employment Actsection 49(4)
  • Employment Actsection 10(6) and (7)
  • Employment Actsection 74(1)
  • Employment Actsection 28
  • Constitution of KenyaArticle 41
  • Evidence Act
  • Civil Procedure Act/Rules

Cases cited (2)

  • Postal Corporation of Kenya v Andrew K. Tanui
    [2019] eKLR
  • Pius Machafu Isindu v Lavington Security Guards Limited
    [2017] eKLR
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under Article 41 of the Constitution and 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, "Murimi v Mini Bakeries (Nairobi) Limited (Cause 2 of 2022) [2024] KEELRC 2604 (KLR)", Case Analysis (2024). Cause No 2 of 2022. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/2604/eng@2024-10-24

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