Flashcom Security Limited v Malika (Appeal E239 of 2023) [2024] KEELRC 2182 (KLR)
The bottom line
#A Kenyan court cut a security guard's unfair dismissal award from twelve to three months' pay but confirmed employers must pay the legal minimum wage even if a contract says less.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether this court should interfere with the trial court's discretion on statutory awards as well as compensation for unfair termination
Key legal issues
#Interference with the trial court's award of maximum 12 months' compensation for unfair termination
Award reduced to 3 months' compensation given the 15 months served and the contract having only three months remaining
Although the award is discretionary, section 49(4) factors must be considered and the trial court had to justify the maximum award. The claimant served only 15 months and his contract had three months to run, so the employment relationship would in any event have ended shortly. Three months' compensation was therefore justified and the maximum award was not.
Award of underpayment against a contractually agreed salary below the statutory minimum wage
Underpayment award upheld; the contract rate of Kshs 8,800 could not displace the statutory minimum of Kshs 17,413.24
The trial court relied on section 48 of the Labour Institutions Act, under which a Wages Order constitutes minimum terms that may not be varied by agreement. The contract of employment was subservient to the express provisions of the law, so the shortfall between the minimum wage and the agreed salary was properly awarded.
Public holidays award without documentary evidence
Award reduced from 17 to 15 days to conform to the pleadings, since the employer produced no records to rebut the claim
Section 74 of the Employment Act places the duty to produce employment records on the employer; the shift checklists did not capture public holidays. However, the claimant pleaded and submitted on 15 days, not 17, and parties are bound by their pleadings, so only 15 days could be awarded.
Salary in lieu of notice
Award upheld as conceded by the Appellant's failure to submit on the ground
Neither party submitted on this ground of appeal, which the court took as an admission that the respondent, having been unfairly terminated without notice, was entitled to payment in lieu of notice under section 36 of the Employment Act.
Legal principles established
#- An appellate court interferes with the exercise of discretion only where the lower court misdirected itself or was clearly wrong, occasioning injustice
- An award of the maximum 12 months' pay for unfair termination must be justified on sound judicial principles, having regard to section 49(4) of the Employment Act
- Parties are bound by their pleadings; submissions do not take the place of pleadings
Court orders
#- 1.Appeal allowed in part: compensation for unfair termination reduced to 3 months' salary (Kshs 52,239.72)
- 2.One month salary in lieu of notice of Kshs 17,413.24 upheld
- 3.Underpayments award of Kshs 129,198.63 upheld
- 4.Public holidays award reduced to 15 days at Kshs 8,706.62
- 5.Total award of Kshs 207,558.21 substituted for the trial court's award
- 6.Each party to bear their own costs of the appeal
The bench
#One judgment of the whole court — no separate or dissenting opinions.
Wrote the judgment
- On appeal from
- Milimani Chief Magistrates Court
- Employment Cause No. E1951 of 2021
- Jurisdiction invoked
- First appellate jurisdiction over the Chief Magistrate's Court employment cause
Relief refused
#Setting aside of the award of one month salary in lieu of notice
Parties never submitted on this head, taken as admission of entitlement under Section 36 of the Employment Act
Setting aside of the underpayment award
Minimum wage under the Regulation of Wages (General) (Amendment) Order 2018 could not be contracted out of
Appellant's prayer for the appeal to be allowed in full with costs
The appeal only partially succeeded
Costs
Each party shall bear their own costs of 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.
In the upshot the Appeal partially succeeds as follows; _
a. 3 months’ salary as compensation for unfair termination Kshs. 52,239.72/= b. One month salary in lieu of Notice Kshs……… 17,413.24 c. Underpayments …………………..Kshs 129,198.63 d. Public Holidays ( 15 days) ………………….. Kshs 8,706.62 Total Kshs 207,558.21
The appeal partially succeeds hence each party shall bear their own costs of this Appeal.
This court notes that parties are bound by their pleadings and submissions do not take place of pleadings.
The trial court relied on section 48 of the Labour Institutions Act which states that Wages Order constitutes minimum terms which may not be varied by any agreement.
Issues in the judgment
#Discrepancy in underpayment figure between submissions (Kshs 129,198.03) and elsewhere in the judgment (Kshs 129,198.63)
Blank figure in the final orders for one month salary in lieu of notice
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Flashcom Security Limited v Malika (Appeal E239 of 2023) [2024] KEELRC 2182 (KLR)", Case Analysis (2024). Employment Appeal at Milimani (appeal against Milimani Chief Magistrates Court Employment Cause No. E1951 of 2021). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/2182/eng@2024-09-06
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.