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ELRCPartially AllowedMemorandum of Appeal dated 18th March 2024 (ELRC Appeal from Principal Magistrate's Court)· [2025] KEELRC 1169 (KLR)

Hatari Security Guards Limited v Dalu (Appeal E043 of 2024) [2025] KEELRC 1169 (KLR)

Employment and Labour Relations Court
24 April 2025
3,605 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~14 min to read original · ~4 min brief

The bottom line

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Kenya's Employment Court confirmed a security guard was constructively dismissed after being denied work, but cut his compensation to five months' salary.

What this practically means

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Executive summary

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The Appellant, a security services company, appealed against the judgment and decree of the Learned Principal Magistrate delivered on 29th February 2024, which found that the Respondent, a night security guard formerly deployed at the NSSF premises in Mombasa, had been unfairly terminated and awarded him reliefs including salary in lieu of notice, leave pay, underpayments, overtime compensation, twelve months' gross salary as compensation, and costs. The Respondent had claimed constructive dismissal, alleging the Appellant failed to allocate work after its NSSF contract lapsed and coerced him to resign to obtain terminal dues. The Appellant contended the Respondent resigned voluntarily and sought dismissal of the suit. On appeal, Ocharo Kebira J, applying the retrial role of a first appellate court, framed two issues: whether the employment was unfairly terminated, and whether the reliefs were properly granted. The court found the Appellant's claim that it had instructed employees to attend training in Nairobi to be a bare assertion unsupported by cogent evidence, held that ceasing to supply work was a repudiatory breach, and concluded the Respondent was constructively dismissed, noting the trial magistrate had wrongly analysed the claim through procedural and substantive fairness rather than constructive dismissal. On reliefs, the court held the trial magistrate improperly granted discretionary awards without reasons, reduced the twelve months' compensation to five months' gross salary (KShs. 87,066.2), and upheld the awards for notice pay, underpayment and overtime, holding wages orders cannot be contracted out and the employer bore the record-keeping burden. The appeal succeeded to a limited extent, with each party bearing its own costs of the appeal.

Key legal issues

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01

Whether the Respondent's resignation amounted to constructive dismissal

Holding

The Respondent was constructively dismissed because the Appellant ceased to supply work after losing the NSSF contract, evincing an intention not to be bound by the contract, and this conduct caused the resignation.

Reasoning

The court found the Appellant's assertion that employees were instructed to attend training in Nairobi was a bare assertion without cogent evidence, given the employees were stationed in Mombasa. Failure to supply work is a fundamental breach. The conduct directly caused the resignation. The trial magistrate erred by analysing procedural and substantive fairness, which are irrelevant to constructive dismissal, but the appellate court reached the same ultimate conclusion on fresh evaluation.

p. 6
02

Whether the award of twelve months' gross salary as compensation was proper

Holding

The discretionary award required reasons; the appellate court exercised its own discretion and reduced compensation to five months' gross salary.

Reasoning

Section 49(1)(c) of the Employment Act confers a discretionary power that must be exercised with regard to the circumstances of each case. The trial magistrate granted twelve months' gross pay without setting out the factors considered. Considering that the Respondent did not contribute to the termination, his length of service, and that the situation was induced by the loss of the NSSF contract, five months' gross salary was appropriate.

p. 6
03

Whether the Respondent was entitled to salary in lieu of notice

Holding

Yes; employment was terminable by twenty-eight days' notice under section 35 of the Employment Act and notice pay followed from the constructive dismissal.

Reasoning

Having successfully litigated the constructive dismissal claim, notice pay was a relief the Respondent was entitled to. The award of KShs. 17,413.24 was not disturbed.

p. 6
04

Whether the claim for underpayment was made out despite contractual remuneration

Holding

Yes; minimum wages under a wages order constitute statutory terms of employment that cannot be varied by agreement, so the trial court did not err in applying the minimum wage.

Reasoning

Section 48(1) of the Labour Institutions Act provides that minimum rates of remuneration and conditions in a wages order constitute terms of employment and may not be varied by agreement. The Appellant's argument that the Respondent was paid his contractual remuneration ignored this provision. The Respondent's evidence that he was a night guard was not discounted since the Appellant's witness could not confirm otherwise.

p. 7
05

Whether the overtime claim was proved absent worksheets

Holding

Yes; the legal duty to keep records and ensure compliance with working hours rested on the employer, so the trial court did not err in allowing the overtime claim.

Reasoning

The Regulations placed a legal duty on the employer to ensure employees did not exceed stipulated hours and to pay for overtime. Under section 74 of the Employment Act the employer is the custodian of employment records and was expected to produce worksheets. The contract did not stipulate hours of work, so under section 10 of the Employment Act the onus was on the Appellant to prove compliance, which it failed to do.

p. 7

Legal principles established

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  • A first appellate court must subject the evidence before the trial court to fresh scrutiny and reach its own independent findings and conclusions
  • Failure by an employer to supply work to an employee is a breach of a fundamental term of the contract of employment capable of grounding constructive dismissal
  • Minimum wages and conditions in a wages order cannot be contracted out and apply as terms of the contract of employment
  • The employer is the custodian of employment records under section 74 of the Employment Act and bears the burden of producing worksheets to disprove overtime claims

Court orders

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  1. 1.The appeal succeeds to a limited extent
  2. 2.The Learned Trial Magistrate's award of twelve months' gross salary for unfair termination is disturbed and in place thereof five months' gross salary, KShs. 87,066.2, is awarded
  3. 3.Each party is to bear its own costs of this appeal

Authorities

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Legislation

  • Employment ActSection 47(5)
  • Employment ActSection 49(1)(c)
  • Employment ActSection 35
  • Employment ActSection 74
  • Employment ActSection 10
  • Labour Institutions ActSection 48(1)
  • Regulation of Wages [Protective Security Services] Order 1998Rule 6

Cases cited (6)

  • Selle v Associated Motor Boat Co.
    [1968] EA 123
  • Abdul Hameed Saif v Ali Mohamed Sholan
    [1955], 22 E.A.C.A. 270
  • German School Society & another v Ohany & another
    (Civil Appeal 325 & 342 of 2018 (Consolidated) [2023] KECA 894 (KLR) (24 July 2023)
  • Kenya Ports Authority v Kuston (Kenya) Limited
    (2009) 2 EA 212
  • Porter v N.B Legal Aid
    [2015] 1. S.R.C.
  • Coca Cola East & Central Africa Limited v Maria Ligaga
    [2015] eKLR
On appeal from
Principal Magistrate's Court
not stated in the judgment
Jurisdiction invoked
First appellate jurisdiction over an appeal from the Principal Magistrate's Court in an employment matter

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, "Hatari Security Guards Limited v Dalu (Appeal E043 of 2024) [2025] KEELRC 1169 (KLR)", Case Analysis (2025). Memorandum of Appeal dated 18th March 2024 (ELRC Appeal from Principal Magistrate's Court). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/1169/eng@2025-04-24

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