Imara Steel Mills Limited v Mulatya (Employment and Labour Relations Appeal E112 of 2021) [2025] KEELRC 131 (KLR)
The bottom line
#Kenya's Employment Court ruled that if your salary contract says it already includes house allowance, you cannot claim it separately.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether the Respondent is entitled to payment of the house allowance awarded by the lower court
- 2.Whether the trial magistrate erred in awarding Kshs 30,000 as unpaid house allowance despite a contractual clause stating salary was inclusive of house allowance
- 3.Whether the Respondent pleaded and strictly proved the special damages claimed
Key legal issues
#Entitlement to house allowance where the contract makes salary inclusive of house allowance
The claim fails; the Respondent knowingly and voluntarily accepted a contract stipulating an inclusive salary, and awarding house allowance rewrote the contract
The court examined the contract of service signed on 29th July 2016, paragraph four of which provided compensation of Kshs 9,126 inclusive of house allowance. Relying on National Bank of Kenya Ltd v Pipeplastic Samkolit (K) Ltd & Another, the court held that awarding the allowance in the face of this clause effectively rewrote the parties' contract, which courts cannot do absent coercion, fraud or undue influence, none pleaded or proved.
Burden and standard of proof for special damages on first appeal
Two payslips were inadequate; special damages must be specifically pleaded and strictly proven under sections 107, 108 and 109 of the Evidence Act
As a first appeal, the court re-evaluated the evidence afresh. The Respondent relied on only two payslips to prove non-payment of house allowance over the employment period. The court found this insufficient to discharge the evidentiary burden imposed by sections 107, 108 and 109 of the Evidence Act, rendering the Kshs 30,000 award unjustified.
Legal principles established
#- Where a signed contract of service expressly states that the salary is inclusive of house allowance, a court cannot award additional house allowance as that would rewrite the contract
- A claimant must meet the burden of proof under sections 107, 108 and 109 of the Evidence Act and strictly plead and prove special damages
Court orders
#- 1.The appeal is allowed
- 2.The judgment of the trial court awarding Kshs 30,000 as unpaid housing allowance is set aside
- 3.Each party shall bear their own costs
The bench
#One judgment of the whole court — no separate or dissenting opinions.
Wrote the judgment
- On appeal from
- Principal Magistrates Court at Kajiado
- Kajiado ELRC No. 2 of 2018
- Jurisdiction invoked
- First appellate jurisdiction over the Principal Magistrates Court (ELRC matters)
Relief refused
#Assessment of liability and quantum of the Respondent with regard to housing allowance
The court instead set aside the award, finding the contract was explicit that salary was inclusive of house allowance
Costs of the appeal
Each party was ordered to bear their own costs
Costs
Each party shall bear their own costs.
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
It is therefore my finding that the appeal has merit and is allowed. The judgment of the trial court awarding Kshs 30,000 as unpaid housing allowance is hereby set aside. Each party shall bear their own costs.
Paragraph four of the contract on compensation was explicit that the salary payable was kshs 9126 which was inclusive of house allowance a term the Respondent knowingly and voluntarily accepted.
The reliance on only two payslips was inadequate to substantiate the claim, and the award was, therefore, unjustified.
This being a first appeal to this court, this court is obligated to re-evaluate the evidence afresh and make a finding accordingly
Issues in the judgment
#The Appellant's name is not stated anywhere in the judgment; only party roles (Appellant/Respondent) are used
Inconsistency in stated basic salary: facts summary says Kshs 6,669 per month while the contract clause is quoted as Kshs 9,126 inclusive of house allowance
Typographical error 'efiectively' and misspelling 'suficient' indicating OCR/rendering defects
The judgment does not state the appeal case number of the present appeal, only the lower court case number
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Imara Steel Mills Limited v Mulatya (Employment and Labour Relations Appeal E112 of 2021) [2025] KEELRC 131 (KLR)", Case Analysis (2025). Kajiado ELRC Appeal arising from Kajiado ELRC No. 2 of 2018. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/131/eng@2025-01-28
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.