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Case Brief · caselaw.co.ke
ELRCPartially AllowedELRC Cause No. 646 of 2019 (lead file, consolidated with ELRC Cause E525 of 2019)· [2025] KEELRC 2002 (KLR)

Mutugi & another v Career Readiness Social Initiative Ltd (Cause 646 of 2019 & E525 of 2021 (Consolidated)) [2025] KEELRC 2002 (KLR)

Employment and Labour Relations Court
8 July 2025
4,427 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~18 min to read original · ~4 min brief

The bottom line

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A Kenyan court awarded two former employees over Kshs 2 million because their employer fired them without completing investigations or holding fair hearings.

What this practically means

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Executive summary

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The 1st Claimant, a Technical Coordinator promoted to Programme Regional Lead, and the 2nd Claimant, a Sewing Machine Operator Instructor, sued their employer for unfair and unlawful termination arising from allegations that, during a meeting of 19 February 2019, they solicited contributions of Kshs 10,000 from instructors as appreciation for a manager's role in salary increments. The two claims were consolidated with ELRC Cause 646 of 2019 as the lead file. The Respondent maintained that the claimants were terminated for gross misconduct after investigations prompted by a whistleblower and that due process was followed; the 1st Claimant denied the allegations and complained of inadequate time and denial of her witness, while the 2nd Claimant said she received no hearing and later resigned. The court framed three issues: validity of reasons, propriety of the disciplinary process, and entitlement to remedies. It found no valid reasons were established: the Respondent's investigation report was dated 7 August 2019, after the 1st Claimant's hearing of 26 July 2019, no evidence was presented at the hearing, and the 2nd Claimant was never heard at all. Under sections 43 and 45 of the Employment Act the terminations were therefore unfair. The court awarded each claimant 8 months' salary as compensation, one month's salary in lieu of notice, certificates of service, costs, and interest at court rates from the date of judgment, less statutory deductions.

Key legal issues

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01

Whether there were valid reasons to warrant the claimants' dismissal

Holding

No valid reasons were established. The Respondent's own investigation report was dated 7 August 2019, after the 1st Claimant's disciplinary hearing of 26 July 2019, showing she was dismissed before investigations were completed, and no evidence was presented against her at the hearing.

Reasoning

The court examined the chronology: notice to show cause dated 25 July 2019, hearing on 26 July 2019, but the investigation report relied upon was dated 7 August 2019. The Respondent called no witnesses at the disciplinary hearing, and witnesses who later implicated the claimants never testified at the hearing. Minutes did not record any evidence adduced. Under section 43 of the Employment Act, the employer failed to prove the reasons for termination.

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02

Whether the claimants were subjected to a proper disciplinary process

Holding

The process was improper. The 1st Claimant was given only 24 hours to respond and no evidence was presented at her hearing; the 2nd Claimant was never subjected to any disciplinary hearing at all.

Reasoning

Section 41 of the Employment Act requires that an employee be informed of the allegations, afforded an opportunity to respond, and heard. The 2nd Claimant received no show cause letter and no hearing. The 1st Claimant's hearing produced no recorded evidence and the Respondent called no witnesses. The 2nd Claimant's position that she resigned was rejected because no valid process preceded the events and the court found she was condemned unheard.

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03

Whether the claimants are entitled to the remedies sought

Holding

Partly. Each claimant was awarded 8 months' salary as compensation for unfair termination plus one month's salary in lieu of notice, a certificate of service, and costs.

Reasoning

Having found the terminations lacked valid reasons and proper process, the court awarded compensation. It settled on 8 months' salary as adequate for claimants terminated without due process, rather than the 12 months claimed. It awarded one month rather than three months' notice pay and ordered issuance of certificates of service and costs.

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Legal principles established

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  • An employer must prove valid reasons for termination; failure to do so renders the termination unfair
  • Termination is unfair where the employer fails to prove a valid and fair reason and that fair procedure was followed
  • An employee condemned without any disciplinary hearing is unfairly terminated

Court orders

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  1. 1.Damages for unfair termination equivalent to 8 months' salary: Kshs 1,142,844 to the 1st Claimant and Kshs 774,992 to the 2nd Claimant
  2. 2.One month's salary in lieu of notice: Kshs 190,474 to the 1st Claimant and Kshs 96,874 to the 2nd Claimant
  3. 3.Total awards of Kshs 1,333,318 for the 1st Claimant and Kshs 871,866 for the 2nd Claimant, each less statutory deductions
  4. 4.The Respondent to issue each Claimant with a certificate of service
  5. 5.The Respondent to pay costs of the suit plus interest at court rates with effect from the date of judgment
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act, 2007 over claims of unfair and unlawful termination of employment

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, "Mutugi & another v Career Readiness Social Initiative Ltd (Cause 646 of 2019 & E525 of 2021 (Consolidated)) [2025] KEELRC 2002 (KLR)", Case Analysis (2025). ELRC Cause No. 646 of 2019 (lead file, consolidated with ELRC Cause E525 of 2019). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/2002/eng@2025-07-08

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