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ELRCPartially AllowedMombasa ELRC Appeal (arising from Mombasa CMELRC No. E150 of 2023)· [2025] KEELRC 2663 (KLR)

Greatlaes Trans (K) Limited v Robert Mackoy Limited (Appeal E081 of 2025) [2025] KEELRC 2663 (KLR)

Employment and Labour Relations Court
2 October 2025
MMM. Mbarū
1,805 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenyan employers must still follow due process and issue a termination notice even when an employee deserts, and cannot pay below the legal minimum wage.

What this practically means

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Executive summary

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This is a first appeal against the judgment of the magistrate's court in Mombasa CMELRC No. E150 of 2023, delivered on 25 April 2025, in which the respondent was awarded various dues for unfair termination of employment. The appellant employer challenged the commencement date of employment, the award of house allowance alongside underpayments as double payment, the failure to offset a consented Ksh. 60,000 deduction, and the award of 3 months' compensation for only two years of service. The court found that a written contract dated 6 April 2020 fixed the commencement of employment, rejecting the respondent's claim of a January 2019 start. It held that the negotiated consolidated wage of Ksh. 25,000 fell below the prescribed minimum wage plus 15% house allowance, and that underpayment inclusive of house allowance could not be awarded twice; it recomputed the underpayment at Ksh. 194,893.40. On desertion, it held that even where an employee abandons duty, the employer must follow due process under Sections 41 and 44 of the Employment Act and issue a notice terminating employment to bring closure; failure to do so rendered the termination unfair, vindicating the magistrate. However, the court varied the quantum: compensation and notice pay were recalculated on the last gross wage of Ksh. 39,448.15 under Section 49(2), yielding Ksh. 118,344.45 for 3 months' compensation, and the unlawful deductions award was reduced to Ksh. 127,241 after offsetting the consented Ksh. 60,000 deduction for negligently caused loss. Trial court costs were preserved; each party to bear its own costs of the appeal.

Key legal issues

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01

Date of commencement of employment

Holding

Employment commenced on 6 April 2020 per the written contract, not 7 January 2019 as the respondent claimed.

Reasoning

The employer is the custodian of work records. A written employment contract dated 6 April 2020 existed, and the respondent was confirmed as heavy commercial truck driver at Ksh. 25,000 per month. The court therefore rejected the respondent's earlier start date.

p. 3
02

Minimum wage and house allowance / underpayment

Holding

The negotiated wage of Ksh. 25,000 fell below the prescribed minimum wage plus 15% house allowance; underpayment inclusive of house allowance computed at Ksh. 194,893.40, not to be awarded separately.

Reasoning

Employment terms cannot fall below the Wage Order thresholds. As a heavy commercial truck driver, the respondent was entitled to minimum wage of Ksh. 30,627.45 plus 15% house allowance from April 2020, and higher rates from May 2022. Awarding house allowance separately from underpayment would double-count.

03

Unfair termination / desertion

Holding

Termination was unfair; issuance of a notice to show cause without closure or a notice of termination does not suffice where an employee allegedly deserts.

Reasoning

The employer issued a notice to show cause and scheduled a disciplinary hearing the respondent did not attend, but took no further step. Desertion is gross misconduct under section 44(4)(a), but the employer must still accord due process under sections 41 and 44 and issue a termination notice to bring closure.

p. 4
04

Compensation quantum and notice pay

Holding

3 months' compensation and notice pay recalculated on the last gross wage of Ksh. 39,448.15 per section 49(2).

Reasoning

The magistrate's award of 3 months' compensation was justified in length given two years of service, but the rate applied was wrong; section 49(2) requires the last gross wage, which includes house allowance, hence Ksh. 39,448.15 × 3 = Ksh. 118,344.45 and the same figure for notice pay.

p. 4
05

Unlawful salary deductions

Holding

The consented Ksh. 60,000 deduction for negligently caused loss is lawful and must be offset; net unlawful deductions payable are Ksh. 127,241.

Reasoning

Sections 17 and 19 of the Employment Act permit deductions where an employee's negligence causes loss. The respondent admitted the mistake, apologised and consented to repay Ksh. 60,000, so the award of Ksh. 178,241 must be reduced accordingly.

p. 5

Legal principles established

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  • On desertion, the employer must still bring the employee to account under Sections 41 and 44 of the Employment Act and issue notice terminating employment to bring closure.
  • Parties to an employment contract cannot agree to a wage below the prescribed minimum wage inclusive of house allowance; the two cannot be awarded separately.
  • Compensation and notice pay under section 49(2) must be computed on the last gross wage.

Court orders

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  1. 1.Employment terminated unfairly
  2. 2.3 months' compensation Ksh. 118,344.45
  3. 3.Notice pay Ksh. 39,448.15
  4. 4.Underpayment inclusive of house allowance Ksh. 194,893.40
  5. 5.Unlawful deductions Ksh. 127,241
  6. 6.Costs of the suit before the trial court to the respondent
  7. 7.For the appeal, each party to bear its own costs
On appeal from
Magistrates' Court (ELRC), Mombasa
CMELRC No. E150 of 2023
Jurisdiction invoked
First appeal to the Employment and Labour Relations Court from the subordinate court (Section 12, Employment and Labour Relations Court 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, "Greatlaes Trans (K) Limited v Robert Mackoy Limited (Appeal E081 of 2025) [2025] KEELRC 2663 (KLR)", Case Analysis (2025). Mombasa ELRC Appeal (arising from Mombasa CMELRC No. E150 of 2023). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/2663/eng@2025-10-02

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