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Court of AppealDismissedCivil Appeal No. 121 of 2015

Peter Muriithi Mwarania v Family Bank Limited & another [2018] KECA 183 (KLR)

Court of Appeal of Kenya
18 October 2018
3,103 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Court of Appeal confirmed that employees claiming higher pay or more compensation must prove it with documents, not estimates.

What this practically means

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Executive summary

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The Court of Appeal (Musinga, Sichale and ole Kantai, JJA) dismissed this first appeal against the judgment of Radido, J. of the Employment and Labour Relations Court at Nakuru, which had declared the appellant's summary dismissal by Family Bank Limited unfair and awarded him Kshs 2,242,562.30, comprising three months' salary in lieu of notice, outstanding leave and six months' salary as compensation, while rejecting claims for exemplary damages and pension dues. The appellant, though he had won at trial, sought enhancement: a higher salary figure of Kshs 249,000 rather than Kshs 225,000, more leave days, twelve months' compensation instead of six, damages for discrimination, pension of Kshs 824,489.53 and interest. The Court affirmed the trial judgment on every contested head. It held that the documentary record fixed the salary at Kshs 225,000 per month, with no written communication or payslip proving any increase. The six months' compensation was a lawful exercise of the section 49 discretion, which an appellate court may interfere with only sparingly; the judge had weighed the appellant's service length and job prospects. The claim of discrimination failed because the dismissal rested on the appellant's professional conduct in irregularly opening accounts, not personal characteristics. The pension claim failed for want of evidence and the appellant's unexplained refusal to complete withdrawal forms, despite instructions in the dismissal letter. The appeal was dismissed with costs, the appellant paying the respondents' costs.

Questions the Court framed

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The issues the Court set itself to decide, in its own words.

  1. 1.Whether the appellant's monthly salary at the time of dismissal was Kshs 249,000 or Kshs 225,000
  2. 2.Whether the appellant was entitled to 26 days (or 24 days) of leave rather than the 21 days found by the trial court
  3. 3.Whether the compensation for unfair termination should have been 12 months' salary rather than 6 months' salary under section 49 of the Employment Act
  4. 4.Whether the appellant was discriminated against in being singled out for dismissal
  5. 5.Whether the appellant was entitled to pension dues of Kshs 824,489.53
  6. 6.Whether exemplary damages, compensation for loss of income and interest should have been awarded

Key legal issues

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01

Proof of the appellant's salary at the time of dismissal

Holding

The salary was Kshs 225,000 per month as per the letter of 14th May 2010, not Kshs 249,000

Reasoning

The only documents evidencing salary were the offer letter of 29th December 2008 (Kshs 190,000) and the review letter of 14th May 2010 (Kshs 225,000 consolidated). An increase to Kshs 249,000 would, given past practice, have been communicated in writing and produced in evidence. The appellant's computation from the summary dismissal payment was speculative and contradicted by his own documentary record. The trial judge's finding was squarely supported by the evidence.

p. 4
02

Quantum of compensation for unfair termination under section 49 of the Employment Act

Holding

The award of 6 months' salary (Kshs 1,350,000) was a proper exercise of discretion and was not disturbed

Reasoning

Section 49(4) requires the decision-maker to consider the circumstances of termination, including the employee's contribution to it, length of service, reasonable expectation of continued employment and prospects of comparable employment. The judge considered the appellant's roughly three years of service and inability to secure alternative employment. Discretionary awards attract only sparing appellate interference; the judge neither considered irrelevant factors nor ignored relevant ones.

p. 5
03

Leave days entitlement

Holding

The appellant was entitled to 24 leave days per completed year, not 26, and the leave award computed on Kshs 225,000 was upheld

Reasoning

The letter of employment provided 24 days of leave per completed year of service. The appellant was dismissed on 23rd November 2011 before the end of the year. His pleaded figure of Kshs 431,599 had no evidential basis and was computed on the wrong salary of Kshs 249,000. The trial court's finding on leave was affirmed as supported by the record.

04

Pension dues

Holding

The claim for pension was rejected for want of evidential basis and the appellant's failure to follow the scheme's withdrawal procedure

Reasoning

The respondents did not dispute the pension entitlement but the appellant never filled in the pension withdrawal forms as instructed in the summary dismissal letter. A party who lays no evidential basis for relief cannot obtain it, even against an unresponsive defendant. The appellant's inaction, despite clear instructions, defeated the claim.

p. 5

Legal principles established

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  • On a first appeal, the court re-analyzes and re-assesses the evidence but will not disturb findings of fact by the trial judge unless they are unsupported by the evidence or perverse
  • An appellate court may interfere only sparingly with discretionary decisions, including the award of months of compensation under section 49(1)(c) of the Employment Act
  • Where a respondent fails to file a response or attend the hearing, the facts put forth by the claimant in the pleadings and testimony are taken as uncontroverted

Court orders

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  1. 1.The appeal is dismissed
  2. 2.The appellant shall pay the respondents' costs of the appeal

The bench

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One judgment of the whole court — no separate or dissenting opinions.

majority
majority
majority
On appeal from
Environment and Labour Relations Court of Kenya at Nakuru
Industrial Cause No. 18 of 2014
Jurisdiction invoked
First appeal to the Court of Appeal under the applicable appellate provisions (appeal from the Employment and Labour Relations Court); no specific constitutional provision cited

Relief refused

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Enhanced salary-based awards (notice pay and leave pay based on Kshs 249,000 per month)

The only documentary evidence was the letter of 14th May 2010 fixing salary at Kshs 225,000; no letter or payslip proved an increase to Kshs 249,000

p. 4

Compensation of 12 months' salary in lieu of 6 months

The award under section 49(1)(c) is discretionary and the Court of Appeal interferes only sparingly; the trial judge considered the relevant statutory factors

p. 5

Damages for discrimination

The dismissal was grounded on the appellant's conduct in irregularly opening accounts, not on personal characteristics

p. 3

Pension dues

The appellant laid no evidential basis for the claim and failed to complete the pension withdrawal forms as instructed

p. 5

Interest on the awards

Abandoned/relied on Rule 29(3) of the Labour Relations Court (Procedure) Rules 2016 but no interest was awarded; the appeal was dismissed in its entirety

Costs

Appeal dismissed with costs - the appellant to pay the respondents' costs of the appeal ("It is hereby dismissed with costs.")

Quotable passages

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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 of the above is that we find no merit in this appeal. It is hereby dismissed with costs.
p. 5Final orders - dismissal of appeal
our duty is to re-analyze and re-assess the evidence and the record and reach our own findings and conclusions on the same
p. 3Duty of a first appellate court
we should respect the findings of fact by the trial Judge unless those findings are not backed by the evidence or the findings are perverse
p. 4Deference to trial court findings of fact
The decision of how many months' worth of compensation a litigant ought to get under Section 49(1) (c) is left to the courts' discretion.
p. 5Discretion in compensation under section 49 Employment Act
The legal consequence of the failure to file a response or attend during the hearing is that the facts put forth by the Claimant in the pleadings and testimony have not been controverted.
p. 4Effect of failure to file a response

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, "Peter Muriithi Mwarania v Family Bank Limited & another [2018] KECA 183 (KLR)", Case Analysis (2018). Civil Appeal No. 121 of 2015. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2018/183/eng@2018-10-18

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