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ELRCPartially AllowedMemorandum of Claim dated 20th September 2017, filed 15/11/2017

Kimotho v All in One Software EA Limited (Cause 2289 of 2017) [2023] KEELRC 2081 (KLR)

Employment and Labour Relations Court
20 June 2023
3,105 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~12 min to read original · ~4 min brief

The bottom line

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A Kenyan court ruled an employee's same-day dismissal unfair because the employer gave shifting reasons and never held a disciplinary hearing, awarding him Kshs 264,000.

What this practically means

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Executive summary

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The claimant, employed as a sales manager from early January 2017 on a one-year contract, was terminated on 7th June 2017 following a dispute with a client, Java House, over quotations and a trial project. He claimed unlawful and unfair termination, alleging contravention of the employment contract and labour laws, absence of any prior warnings or disciplinary hearing, and denial of his dues including 30% commission on sales. The respondent denied the claimant was a bona fide employee (having not signed the contract), alleged he received numerous warning letters for misconduct including drunkenness, and blamed him for losing the Java House deal, invoking section 44 of the Employment Act for summary dismissal. The court framed two issues: whether the termination was unfair/unlawful and whether the reliefs were merited. Applying sections 41, 43 and 45 of the Employment Act, and the 'range of reasonable responses' test from the Court of Appeal in Kenya Revenue Authority v Reuwel Waithaka Gitahi, the court found the reasons in the warning letters differed from the stated reason for termination, amounting to a fishing expedition, and that the claimant was terminated the same day without a hearing. Both substantive justification and procedural fairness were absent. The claimant was awarded two months' salary as compensation (Kshs 160,000), nine leave days (Kshs 24,000) and one month's pay in lieu of notice (Kshs 80,000), totalling Kshs 264,000, plus a certificate of service within 30 days, costs and interest from the date of judgment.

Questions the Court framed

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

  1. 1.Whether the termination of the engagement on the 07 June 2017 was unfair/unlawful
  2. 2.Whether the reliefs sought are merited

Key legal issues

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01

Whether the respondent had a valid and fair reason for terminating the claimant's employment under sections 43 and 45(1) of the Employment Act

Holding

No valid reason was established; the reasons in the warning letters differed from the stated reason for termination, indicating a fishing expedition

Reasoning

The termination letter cited failure to deliver Kshs 500,000 sales and issuing wrong quotations, but the respondent's witness testified the dismissal was for disobeying the Director's orders. The warning letters alleged drunkenness and lateness - reasons inconsistent with the termination letter. Under section 43, the employer must prove reasons it genuinely believed to exist. The shifting reasons showed no genuine, verifiable justification.

p. 6
02

Whether the termination complied with the procedural requirements of section 41 of the Employment Act

Holding

Procedure was not followed; the claimant was not given a hearing, no notice to show cause, and was terminated the same day as the Java incident

Reasoning

Section 41 mandates that before termination on grounds of misconduct, the employer must explain the reasons to the employee in a language they understand and allow them to be accompanied by a colleague or union representative. No disciplinary hearing minutes were produced; the claimant testified he was never called to a hearing or given a show-cause notice, and was terminated on the same day as the dispute.

p. 6
03

Whether the reliefs sought are merited

Holding

Claimant awarded the equivalent of two months' salary as compensation, 9 leave days, one month's pay in lieu of notice, a certificate of service, and costs with interest

Reasoning

Having found the dismissal unfair and unlawful contrary to sections 41, 43 and 45 of the Employment Act, the court exercised its discretion to compensate the claimant with two months' salary, in addition to accrued leave days, notice pay and the certificate of service sought in the claim.

p. 6

Legal principles established

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  • An employer must have both substantive justification and procedural fairness before terminating employment; absence of either renders dismissal unfair.
  • The standard of proof for the employer's reasons for dismissal is on a balance of probability, and the reasonableness of dismissal is tested against the range of reasonable responses of a reasonable employer.

Court orders

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  1. 1.Award of 2 months' salary equivalent as compensation for unfair termination, Kshs 160,000
  2. 2.Award of 9 leave days, Kshs 24,000
  3. 3.One month's pay in lieu of notice, Kshs 80,000 (total award Kshs 264,000)
  4. 4.Costs awarded to the claimant with interest at court rates from date of judgment till full payment
  5. 5.Claimant to be issued certificate of service within 30 days

The bench

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

Wrote the judgment

Jurisdiction invoked
Employment and labour relations jurisdiction (Employment Act, 2007); claims of unfair/unlawful termination of employment

Relief refused

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30% commission on sales (as pleaded in the claim regarding the Java House contract)

The court's remedies did not include any commission award; the contract was never signed and the claimant was compensated instead

p. 3

Costs

Costs are awarded to the claimant and interest at court rates from date of judgment till full payment.

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.

Having failed to present a clear, verifyable reason and having failed to follow the procedures well mandated in section 41 of the Employment Act the court must hold the respondent dismissed the claimant unfairly and unlawfully.
p. 6Unfair termination - substantive and procedural fairness
The reasons in the warning letters are difierent from the reason the claimant was terminated for. That can only lead to the conclusion that the respondent was on a fishing expedition as to the reason for termination.
p. 6Shifting reasons for termination
The claimant was not given a chance to represent himself in a disciplinary hearing in the presence of a witness who would be a fellow colleague or a shop fioor union representative.
p. 6Right to be heard under section 41 Employment Act
Costs are awarded to the claimant and interest at court rates from date of judgment till full payment.
p. 6Final orders - costs and interest

Issues in the judgment

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minor

The judgment inconsistently records the claimant's employment start date - the appointment letter is described in testimony as dated 13/12/2017 while employment is elsewhere stated to have run from 5th January 2017

minor

The court quotes section 45(1) as stating only 'No employer shall terminate the employment of an employee unfairly.' and then immediately discusses warning letters in a passage that appears disjointed

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, "Kimotho v All in One Software EA Limited (Cause 2289 of 2017) [2023] KEELRC 2081 (KLR)", Case Analysis (2023). Memorandum of Claim dated 20th September 2017, filed 15/11/2017. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2023/2081/eng@2023-06-20

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