Rift Valley Railways (K) Limited v William Nembe Obora & 74 others [2016] KECA 69 (KLR)
The bottom line
#Kenya's Court of Appeal ruled that even genuine staff misconduct cannot justify dismissal without a hearing, though it cut the employees' payout.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.What was the nature of the respondents' activities of 30th June, 2011?
- 2.Could these activities found a proper basis for summary dismissal of the respondents?
- 3.What were the consequences of those activities and the subsequent actions of the appellant against the respondents?
- 4.Was the appellant's counter-claim proved on a balance of probabilities?
- 5.What orders should be made in this appeal?
Key legal issues
#Whether the activities of 30th June, 2011 constituted an unlawful strike justifying summary dismissal
The Court found it unnecessary to determine whether the activities amounted to a strike; the appeal turned on whether the dismissal conformed to the contracts and the Employment Act, which it did not
The learned Judge of the trial court had made no determination on whether the activities amounted to an unlawful or unprotected strike. The Court held that the respondents had legitimate concerns about the twin early retirement/retrenchment programmes, which the appellant had not explained prior to 30th June 2011, and that the legality of the actions was immaterial because the dismissal breached sections 41, 42 and 45 of the Employment Act in any event.
Whether the summary dismissal was procedurally fair
The dismissal was unfair: no explanation or hearing preceded the dismissal letters, the appellant's own Human Resource manual was breached, and the appeal process was a sham tainted by bias
Section 41 requires an employer to explain the reasons for termination and hear representations before dismissal. The appellant wrote dismissal letters the day after the events, heard no one, and discriminated by reinstating the rest of the workforce while keeping the respondents dismissed. The Chief Human Resource Officer who orchestrated the dismissals also participated in the appeals, offending the rule against bias.
Whether the award of 21 months' salary was ultra vires the statutory twelve-month cap
Section 49(1) permits any or all of the listed remedies; twelve months is not a maximum, so the combined award was lawful in principle, but the extra eight months' gross salary award had no statutory basis
Section 49(1) allows remedies under (a), (b) and (c) singly or in combination, and section 50 directs the court to be guided by those provisions. The award of one month in lieu of notice plus twelve months' compensation was therefore permissible. However, the further award of eight months' gross salaries under section 12(3)(viii) of the E&LRCA was not justified where the respondents had not worked during the period.
Whether the appellant's counter-claim for Kshs.42,300,000.00 was proved
The counter-claim failed because the special damages were neither particularised nor strictly proved nor attributed to the respondents
A claim in special damages must be specifically pleaded and strictly proved. The counter-claim carried no particulars; the loss could not be apportioned between passenger and cargo trains, or between the respondents and the larger reinstated workforce. Passenger services were cancelled mainly for safety reasons unconnected to the respondents.
Whether the respondents' contribution to the dismissal should have reduced the compensation
Although prima facie persuasive, the argument failed because the appellant's discriminatory singling out of the respondents for summary dismissal justified the full awards
Relying on CMC Aviation, the appellant argued the respondents' contributory conduct should reduce compensation. The Court held the appellant had over 500 employees in its Nairobi workforce who participated in the same activities, yet only the respondents were denied reinstatement and the benefits of the voluntary early retirement/retrenchment programme, which smirched of discriminatory conduct and justified the awards.
Legal principles established
#- Even where gross misconduct is alleged, an employer must hear the employee before summary dismissal; dismissal without notification and hearing under section 41 of the Employment Act is unfair termination
- Twelve months' salary is not the maximum compensation awardable under section 49 of the Employment Act; remedies may be combined
- An employer must not be a judge in his own cause; officers who orchestrate a dismissal should not participate in the appeal process
- Special damages must be specifically pleaded and strictly proved
- On a first appeal, the Court of Appeal re-appraises the facts and draws its own conclusions while allowing for not having heard the witnesses
Court orders
#- 1.Set aside the award of gross salaries from 4th July, 2011 to 26th March, 2012 amounting to Kshs.20,871,664.00
- 2.Varied the judgment of the Employment and Labour Relations Court to that extent
- 3.The sums left intact to attract interest at court rates from the date of filing suit until payment in full
- 4.Each party to bear its/their own costs in the appeal
The bench
#One judgment of the whole court — no separate or dissenting opinions.
Wrote the judgment
Wrote the judgment
Wrote the judgment
- On appeal from
- Employment and Labour Relations Court of Kenya at Nairobi (Industrial High Court)
- H.C. Industrial Cause No. 499 of 2012
- Jurisdiction invoked
- First appeal under Article 164(1) of the Constitution, Section 3 of the Appellate Jurisdiction Act, Section 78 of the Civil Procedure Act and Rule 29(1) of the Court of Appeal Rules
Relief refused
#Setting aside the awards of twelve months' salary compensation and one month's salary in lieu of notice
The appellant's discriminatory singling out of the respondents from a workforce of over 500 who participated in the same activities justified the awards
Allowance of the appellant's counter-claim of Kshs.42,300,000.00
Special damages must be specifically pleaded and strictly proved; the loss was not particularised or attributed to the respondents
Appellant's application to substitute an order dismissing the respondents' claim
The dismissal of the respondents was unfair and unprocedural contrary to sections 41, 42 and 45 of the Employment Act
Costs
Each party shall bear its/their own costs in this appeal
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.
The upshot is that we set aside the award of gross salaries from 4 th July, 2011 to 26th March, 2012 amounting to Kshs.20,871,664.00. The judgment of the Employment and Labour Relations Court is varied to that extent.
The sums left intact shall attract interest at court rates from the date of filing suit until payment in full.
the order which commends itself to us on the issue of costs is that each party shall bear its/their own costs in this appeal.
An appeal to this Court from a trial by the High Court is by way of retrial, and the principles upon which this Court Acts in such an appeal are well settled.
Unfair termination involves breach of statutory law. Where there is a fair reason for terminating an employee's service but the employer does it in a procedure that does not conform with the provisions of a statute, that still amounts to unfair termination.
Plaintiffs must understand that if they bring actions for damages it is for them to prove their damages, it is not enough to write down the particulars, and, so to speak, throw them at the head of the Court
Issues in the judgment
#The counter-claim amount is inconsistently stated: paragraph 20 pleads a loss of Kshs.43,200,000.00 while paragraph 26 pleads Kshs.42,300,000.00 for the same claimed loss, and the judgment adopts the latter figure
The heading describes the respondents as 'WILLIAM NEMBE OBORA AND 74 OTHER' while the body refers to 'William Nembe & 73 Others' and 'all the 75 claimants'
Key timeline
#Practical implications
#Frequently asked questions
#Later judgments citing this (1)
#Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.
- Abdulrahman v Transafrica Motors Limited (Civil Appeal E141 of 2023) [2026] KECA 912 (KLR)[2026] KECA 912 (KLR)15 May 2026followed
Cite this brief
#Cite this brief
Caselaw, "Rift Valley Railways (K) Limited v William Nembe Obora & 74 others [2016] KECA 69 (KLR)", Case Analysis (2016). Civil Appeal No. 265 of 2015. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2016/69/eng@2016-12-02
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.