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ELRCPartially AllowedMavoko CMEL Appeal from Cause No. 055 of 2019 (Memorandum of Appeal dated 22nd August 2024)· [2025] KEELRC 3733 (KLR)

Sinohydro Tianjin Engineering Company Limited v Kalee & another (Employment and Labour Relations Appeal E015 of 2024) [2025] KEELRC 3733 (KLR)

Employment and Labour Relations Court
17 December 2025
JKJ. W. Keli
3,669 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Employment Court confirmed the workers' dismissal was unfair but slashed their compensation, ruling maximum awards need strong justification.

What this practically means

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Executive summary

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The Appellant employer appealed against the judgment of Hon. D. Kuto (M) delivered on 31st July 2024 in Mavoko CMEL Cause No. 055 of 2019, in which the Respondents' claim for unfair termination was allowed with an award of 12 months' gross salary as compensation to each claimant, plus costs and interest. The appeal was canvassed by written submissions. The court, sitting as a first appellate court, framed two issues: whether the trial court erred in finding unfair termination, and whether it erred in the relief granted. On the first issue, on re-evaluation of the evidence, the court agreed with the trial magistrate that the termination was unfair. The appellant's own witness indicated the respondents were arrested on site on 21st February 2019, and the produced notices to show cause of even date were not supported by the pleadings and were found not to have been served; the disciplinary minutes of 26 February 2019 showed no attendance by the respondents, failing the procedural fairness threshold of section 41 of the Employment Act. On relief, the court found that the maximum 12 months' compensation lacked justification, contrary to settled jurisprudence that such awards must be based on sound judicial principles and justified, considering section 49(4) factors including length of service and the employee's contribution to termination. Given short service (1 year 1 month and 1 year 8 months respectively) and suspected theft (though not charged), the maximum awards were set aside and substituted with 1 month's compensation for the 1st claimant and 2 months' for the 2nd claimant, with notice pay upheld. The appeal was allowed in part; the trial judgment was set aside and substituted, claimants' costs and interest at first instance were awarded, and the appellant received costs of the appeal.

Key legal issues

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01

Whether the termination of the Respondents was substantively and procedurally unfair

Holding

The court upheld the trial court's finding of unfair termination: the notices to show cause dated 21st February 2019 were not supported by the pleadings and were not served; the disciplinary minutes did not show the respondents' attendance, breaching section 41 of the Employment Act.

Reasoning

Re-evaluating the evidence, the appellant's own witness stated the respondents were arrested on site on 21st February 2019 with no mention of issuing notices to show cause the same day. Both respondents denied receiving the notices, and the minutes of 26 February 2019 recorded no attendance by them. The notices were found to be an unsuccessful attempt to mislead the court, and the process failed the procedural fairness threshold under sections 41 and 45(2) of the Employment Act.

p. 4
02

Whether the award of 12 months' gross salary as compensation was excessive

Holding

The maximum compensation was set aside and substituted with 1 month's compensation for the 1st respondent (1 year 1 month service) and 2 months' for the 2nd respondent (1 year 8 months service); notice pay of 1 month was upheld for both.

Reasoning

Section 49(4) requires consideration of length of service and the employee's contribution to the termination. The trial court gave no justification for the maximum award, contrary to the rule that a 12-month award must rest on sound judicial principles. Given the short service and the claimants' suspected theft (though not charged), the maximum award was disproportionate; proportionate reductions were warranted guided by Kenya Ports Authority v Munyao and CMC Aviation v Mohammed Noor.

p. 7

Legal principles established

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  • An award of the maximum 12 months' pay under section 49(1)(c) of the Employment Act must be based on sound judicial principles and justified by the court; the exercise of discretion must not be capricious or whimsical.
  • Where an employee's own conduct contributed to the termination, the court may reduce the compensatory award proportionately, though this does not bar recovery altogether.
  • The duty of a first appellate court is to re-evaluate, re-assess and re-analyse the evidence on the record and determine whether the conclusions of the trial court should stand.

Court orders

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  1. 1.The appeal is allowed.
  2. 2.The Judgment and Decree of the Hon. D. Kuto (M) delivered on 31st July 2024 in Mavoko CMEL Cause No. 055 of 2019 is set aside and substituted with reduced awards for the 1st and 2nd Claimants.
  3. 3.1st Claimant awarded: 1 month's compensation for unfair termination Kshs.13,573/-; notice pay Kshs.13,573; minimum wage balance Kshs.22,187; unpaid leave Kshs.14,930/=; house allowance Kshs.26,875.
  4. 4.2nd Claimant awarded: compensation of 2 months Kshs.27,146; notice pay Kshs.13,573; minimum wage balance Kshs.37,547; unpaid leave Kshs.24,431; house allowance Kshs.37,547.
  5. 5.The claimants are awarded costs and interest on the sums awarded and on the costs from the date of the Judgment.
  6. 6.The appellant is awarded costs of the appeal.
  7. 7.It is so Ordered.

Authorities

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Legislation

  • Employment Actsection 45(2)
  • Employment Actsection 41
  • Employment Act, 2007section 49(1)(c)
  • Employment Actsection 49(4)

Cases cited (13)

  • Walter Ogal Anuro v Teachers Service Commission
    [2013] eKLR
  • Abok James Odera t/a AJ Odera & Associates v John Patrick Machira t/a Machira
    e KLR
  • Karuga v Style Industries Ltd
    (2023) KEELRC 3359 (KLR)
  • CMC Aviation Limited v. Mohammed Noor
    [2015] eKLR
  • Kenya Airways Limited v. Aviation & Allied Workers Union Kenya & 3 Others
    [2014] eKLR
  • Alex Wainaina Mbugua v. Kenya Airways Limited
    [2017] eKLR
  • Kimathi v Ericsson Kenya Limited
    (Civil Appeal 601 of 2019) [2023] KECA 106 (KLR)
  • Cofiee Board of Kenya v Thika Cofiee MU/s Limited & 2 Others
    [2014] eKLR
  • Kenya Broadcasting Corporation v Geoffrey Wakio
  • Ol Pejeta Ranching Limited vs. David Wanjau Muhoro
    [2017] eKLR
  • KenFreight (E.A) Limited v Benson K. Nguti
    SC Pet. No. 37 of 2018 [2019] eKLR
  • KenFreight (EA) Limited v Benson Nguti
    (2019) eKLR
  • Kenya Ports Authority v Munyao & 4 others
    (Petition E008 of 2023) [2023] KESC 112 (KLR) (28 December 2023)
On appeal from
Principal Magistrate's Court (Mavoko), ELRC Cause
Mavoko CMEL Cause No. 055 of 2019
Jurisdiction invoked
First appellate jurisdiction over the subordinate court's judgment in the employment cause (Memorandum of Appeal dated 22nd August 2024)

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, "Sinohydro Tianjin Engineering Company Limited v Kalee & another (Employment and Labour Relations Appeal E015 of 2024) [2025] KEELRC 3733 (KLR)", Case Analysis (2025). Mavoko CMEL Appeal from Cause No. 055 of 2019 (Memorandum of Appeal dated 22nd August 2024). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2025/3733/eng@2025-12-17

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