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ELRCPartially AllowedMavoko CMEL Appeal (Memorandum of Appeal dated 8th June, 2022)

Royal Garments Industries EPZ Limited v Wanyonyi (Appeal E202 of 2023) [2024] KEELRC 2480 (KLR)

Employment and Labour Relations Court
11 October 2024
2,639 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~11 min to read original · ~4 min brief

The bottom line

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Even when an employee clearly commits gross misconduct, Kenyan employers must still give them a hearing or the dismissal is unfair — though compensation may be minimal.

What this practically means

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Executive summary

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This is a judgment of the Employment and Labour Relations Court (Appeals Division, Nairobi) delivered on 11th October 2024 by Abuodha Nelson Jorum, Presiding Judge - Appeals Division, dismissing in part and allowing in part an appeal against the judgment of Hon. S. Jalango in Mavoko CMEL No. 80 of 2020, which had awarded a former employee Kshs 180,000/= (12 months' compensation for unfair termination) plus notice pay of Kshs 15,000/=. The appeal was disposed of by written submissions. On the first issue, the court held that although the Respondent's summary dismissal was substantively justified - she admitted in her response to the show cause letter that she was involved in a fight, constituting gross misconduct under section 44 of the Employment Act - the Appellant failed to follow the mandatory hearing procedure under section 41; even in gross misconduct cases, an employee must be heard. The termination was therefore procedurally unfair under section 45. On quantum, applying Selle v Associated Motor Boat Company and Kenya Revenue Authority v Darasa Investments on interference with discretionary awards, and Kenya Broadcasting Corporation v Wakio and Ol Pejeta Ranching on the requirement to justify maximum awards, the court found the 12 months' compensation excessive. The Respondent was only months into a one-year contract ending December 2019, contributed to her own misfortune, and had secured alternative employment through the Appellant's HR. The court substituted the award with one month's salary (Kshs 15,000/=) and declined notice pay, each party bearing its own 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 trial learned Magistrate erred in finding that the Respondent was unprocedurally terminated
  2. 2.Whether the trial learned Magistrate erred in awarding the Respondent maximum compensation of 12 months' salary

Key legal issues

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01

Whether the Respondent's summary dismissal was substantively justified

Holding

The Appellant had a valid reason to dismiss the Respondent - she admitted in her response to the show cause letter that she was involved in a fight, amounting to gross misconduct under section 44 of the Employment Act

Reasoning

The court noted that the Respondent responded to the show cause letter admitting involvement in the fight and apologizing. Upon her own admission, it was clear she was dismissed for gross misconduct of fighting as provided under section 44. The trial court therefore erred in finding the Respondent was unfairly terminated on substantive grounds.

p. 4
02

Whether the dismissal procedure complied with section 41 of the Employment Act

Holding

The court agreed with the trial court that due procedure was not followed; the Respondent ought to have been heard on the allegations despite the show cause letter being issued

Reasoning

The court held that even where gross misconduct warrants dismissal, section 41 sets up a mandatory and elaborate process requiring notification and hearing before termination. Issuing a show cause letter and receiving a response was not enough; the Respondent ought to have been heard on the allegations of fighting. The dismissal was therefore procedurally unfair under section 45.

p. 5
03

Whether the trial court erred in awarding maximum 12 months' compensation

Holding

The award of 12 months' compensation was too high; it was substituted with one month's salary (Kshs 15,000/=) as compensation

Reasoning

The trial court did not justify the maximum award on sound judicial principles as required by section 49(4) of the Employment Act. The Respondent was only months into a one-year contract expiring December 2019, contributed to her own misfortune by fighting, and had secured alternative employment with the assistance of the Appellant's HR, which should not be penalized. These section 49 considerations warranted a reduced award.

p. 5

Legal principles established

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  • Even in cases of gross misconduct warranting summary dismissal, an employee must be heard before termination under section 41 of the Employment Act
  • The burden of justifying the grounds of termination lies with the employer, and unproved reasons amount to unfair termination
  • An award of maximum 12 months' compensation must be justified by the court on sound judicial principles, considering section 49(4) factors
  • An appellate court will not interfere with the trial court's discretion on damages unless it misdirected itself leading to a wrong decision or injustice

Court orders

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  1. 1.One month's salary as compensation for unfair termination of Kshs 15,000/= in substitution for the 12 months' compensation of Kshs 180,000/= awarded by the trial court
  2. 2.Notice pay of Kshs 15,000/= not to be awarded, the court having found justifiable grounds for summary dismissal
  3. 3.Each party to bear their own costs of the Appeal

The bench

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

Wrote the judgment

On appeal from
Mavoko Chief Magistrate's Court
CMEL No. 80 of 2020
Jurisdiction invoked
Appellate jurisdiction over appeals from the Chief Magistrate's Employment and Labour Court (ELRC Act, Appeals Division)

Relief refused

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Setting aside of the entire judgment and entry of judgment in favour of the Appellant

Though the Appellant had a valid reason for dismissal, procedural fairness under section 41 was not followed, so the termination remained unfair

p. 5

Payment in lieu of notice

The court found justifiable grounds for summary dismissal existed and the Appellant did not challenge the notice pay issue in a way that preserved the award

p. 6

Costs

The appeal partially succeeds hence each party shall bear their own costs of this Appeal

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 court therefore consider the maximum award of 12 month's salary as too high and in the circumstances taking ingo account that the appellant had justifiable reasons to dismiss the hereby substitutes the 12 months compensation with one month's salary as compensation for unfair termination
p. 6Substitution of compensation award
The appeal partially succeeds hence each party shall bear their own costs of this Appeal
p. 6Final orders - costs
In conclusion this court finds that the Appellant had a valid reason to dismiss the Respondent but failed on the procedural part under section 41 of the Act hence this amounted to unfair termination under section 45 of the Act
p. 5Substantive validity vs procedural fairness
The courts have always held that even in cases of gross misconduct warranting dismissal an employee must be heard
p. 4Right to be heard despite gross misconduct
an award of the maximum 12 months' pay must be based on sound judicial principles
p. 5Maximum compensation award

Issues in the judgment

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minor

Internal tension: the court found valid reasons for dismissal and refused notice pay, yet still awarded compensation for unfair termination based solely on procedural lapse; also the judgment's heading references a first-instance appeal structure but the substituted notice pay treatment is ambiguous

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, "Royal Garments Industries EPZ Limited v Wanyonyi (Appeal E202 of 2023) [2024] KEELRC 2480 (KLR)", Case Analysis (2024). Mavoko CMEL Appeal (Memorandum of Appeal dated 8th June, 2022). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/2480/eng@2024-10-11

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