Muga v Sbc Kenya Limited (Cause 346 of 2019) [2025] KEELRC 1391 (KLR)
The bottom line
#Kenya's Employment Court ruled that forced transfers and demotions that pushed a manager to resign amounted to constructive dismissal, awarding him over Kshs 1.1 million.
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 Claimant was constructively dismissed by the Respondent.
- 2.Whether the parties are entitled to the reliefs sought.
Key legal issues
#Whether the Claimant was constructively dismissed
Yes - the Respondent breached the employment contract by unilaterally varying terms without consultation and by unreasonable transfers and demotion, amounting to unfair labour practice that caused the resignation.
The court held that although the employer had a contractual prerogative to transfer under clause 11, it had to be exercised reasonably. The Respondent transferred the claimant from Eastern Region to Nairobi without consultation, withdrew his vehicle, banned travel to the region he was to oversee, issued a warning and show cause without hearings, and then issued hasty demoting transfers to Magadi and Garissa within hours. Section 10(5) of the Employment Act required consultation and written notification of any change. The poor performance justification was unsubstantiated where the claimant had been barred from the region. These actions made continued employment intolerable, compelling the resignation.
Whether the parties are entitled to the reliefs sought
Claimant awarded 6 months' salary as compensation and the withheld one month's salary in lieu of notice; counterclaim dismissed.
Having found constructive and unfair dismissal, the court invoked section 49-type compensation. Considering the roughly three years of service and the contract's termination clause, 6 months' salary (Kshs 990,000/=) was deemed reasonable rather than the 12 months claimed. Because the Respondent had withheld one month's salary (Kshs 165,000/=) from terminal dues as notice pay, and the claimant proved unfair termination, that sum was payable to him. The Respondent's counterclaim for notice pay would have amounted to unjust enrichment and failed with the main claim.
Scope of the employer's transfer prerogative and the duty to consult
The transfer discretion must be exercised reasonably and fairly with due notice and facilitation; unilateral variation of an essential term without consultation is repudiation.
Relying on Henry Ochido v NGO Co-ordination Board, the court accepted that it is not for the employee to dictate the station of work, but the employer must give sufficient and reasonable notice, facilitation, and hear the employee regarding the transfer, including extension of time or review of job requirements. Section 10(5) of the Employment Act obliges the employer, in consultation with the employee, to revise the contract to reflect changes and notify the employee in writing. Kenya County Government Workers Union v Wajir County Government confirmed the common law rule against unilateral variation is subsumed in fair labour practice principles.
Legal principles established
#- An employer's prerogative to transfer or deploy employees must be exercised reasonably and not arbitrarily.
- An employer cannot unilaterally vary an employment contract without consultation; such variation is unlawful and amounts to repudiation and breach of contract, subsumed within fair labour practices.
- Ingredients of constructive dismissal: employer's breach of contract, breach must be repudiatory, employee must resign in response, and must not delay in resigning.
- Employer conduct that constitutes unfair labour practice causing an employee's resignation amounts in law to constructive dismissal.
Court orders
#- 1.6 months' salary as compensation for unfair termination of employment - Kshs 990,000/=.
- 2.1 month's salary that was withheld from the Claimant's terminal dues - Kshs 165,000/=.
- 3.Costs and interests of the suit.
- 4.Total award of KSHS 1,155,000/=.
The bench
#One judgment of the whole court — no separate or dissenting opinions.
Wrote the judgment
- Jurisdiction invoked
- Articles 41 and 162(2) of the Constitution and the Employment Act, 2007 (employment and labour relations jurisdiction of the ELRC)
Relief refused
#Claimant's prayer for 12 months' salary as compensation for unfair termination (Kshs 1,980,000/=)
The court found 6 months' salary reasonable compensation given the roughly three years of service, rather than the maximum 12 months sought.
Respondent's counterclaim for Kshs 165,000/= being one month's salary in lieu of notice, declaration of non-clearance, and general damages for breach of contract
The claimant succeeded; the court found the withheld month's salary was payable to the claimant as pay in lieu of notice, defeating the counterclaim.
Costs
Costs of the suit awarded to the Claimant, together with interests.
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.
an employer has the prerogative to transfer/deploy its employees. However, that prerogative should be exercised reasonably and not arbitrarily.
Thus, in law, the Respondent could not unilaterally vary the Claimant's employment contract without consultation.
The actions of the Respondent from June 2017 therefore amounted to unfair labour practice and caused the claimant to resign as the only reasonable response in the circumstances. This amounted in law to constructive dismissal.
In conclusion the Claimant's claim is hereby allowed with costs as follows;
6 months' salary as compensation for unfair termination of employment….….Kshs. 990,000/=.
1 month's salary (that was withheld from the Claimant's terminal dues) …………Kshs 165,000/
An award of 6 months' salary would be reasonable compensation in the circumstances.
Issues in the judgment
#The judgment records a partial hearing before a different judge - the Claimant's case was heard by Lady Justice Monica Mbaru - but the judgment is delivered and signed by Abuodha Nelson Jorum without explaining the transition.
The judgment states the claimant worked from 2016 to 2019, whereas the pleadings and evidence show the claimant resigned on 3rd September 2018 (roughly two and a half years of service).
Paragraph numbering in the judgment is duplicated after paragraph 21 (two paragraphs numbered 20 and 21 appear in sequence, and numbering restarts erratically in the submissions section).
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Muga v Sbc Kenya Limited (Cause 346 of 2019) [2025] KEELRC 1391 (KLR)", Case Analysis (2025). Memorandum of Claim dated 9th May 2019 (ELRC). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/1391/eng@2025-05-09
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.