Skip to content
AI-generated case briefs sourced from Kenya Law · Not legal advice
AI-generated case brief
Case Brief · caselaw.co.ke
ELRCPartially AllowedMemorandum of Appeal dated 22nd December, 2023

Anirita Poultry Farms Ltd v Juma (Appeal E269 of 2023) [2024] KEELRC 2487 (KLR)

Employment and Labour Relations Court
11 October 2024
4,337 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~17 min to read original · ~4 min brief

The bottom line

#

Kenya's Employment Court cut a dismissed worker's compensation in half but confirmed employers lose when they cannot prove valid reasons and follow fair disciplinary procedure.

What this practically means

#

Executive summary

#
The Employment and Labour Relations Court at Nairobi, Abuodha Nelson Jorum, Presiding Judge - Appeals Division, disposed of this appeal by written submissions. The Appellant appealed against the judgment of Hon. G. Omodho delivered on 30th November 2023 in MCELRC/278/2020, in which judgment was entered for the Claimant (Respondent herein) in the sum of Kshs 267,286.21 under heads of house allowance, unfair termination, service pay and pay in lieu of notice, with costs and interest. The Appellant, an employer, contended the Respondent resigned voluntarily after organising an illegal industrial action, that allegations of forged signatures were raised only in submissions, and that the trial court's maximum 12 months' compensation, service pay and house allowance awards were unjustified. The court framed two issues: whether the trial magistrate erred in finding unfair termination, and whether she erred in awarding maximum compensation and other reliefs. Applying Selle v Associated Motor Boat Company, the court held the Appellant failed to prove valid reasons for termination under sections 43 and 47(5), and failed to follow the mandatory notification and hearing procedure under section 41, since no show cause notice was produced and the Respondent's name and signature were absent from the minutes. It also found the awards of service pay (Respondent being an NSSF member under section 35(6)) and house allowance (payment details showing he was paid house allowance) were erroneous. The court allowed the appeal in part, substituting 12 months' compensation with 6 months' salary (Kshs 93,600) plus one month's notice pay (Kshs 15,600), totalling Kshs 109,200, and ordered each party to bear their own costs of the appeal.

Questions the Court framed

#

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 unfairly terminated.
  2. 2.Whether the trial learned Magistrate erred in awarding the Respondent maximum compensation of 12 months' salary and other awards.

Key legal issues

#
01

Whether the Respondent was unfairly terminated

Holding

Yes - the Appellant failed to prove valid reasons for termination and failed to follow the fair procedure under section 41 of the Employment Act

Reasoning

The stated grounds (deserting work and making calls on the supervisor's phone) were not proved; the Appellant knew the Respondent had accompanied a sick colleague to hospital and even sent Kshs 3,000 for the bill. No show cause notice or notice of disciplinary hearing was produced, the Respondent's name and signature were absent from the minutes, and the informal reading of charges did not amount to a disciplinary hearing. The resignation letter was contested and never mentioned in the Appellant's witness statement and documents at first instance.

p. 7
02

Whether the trial court erred in awarding 12 months' salary as compensation

Holding

Yes - the award was reduced to 6 months' salary

Reasoning

The award of 12 months' compensation is discretionary but must be guided by section 49(4) of the Employment Act and justified on sound judicial principles. The matter was disposed of by written submissions so the trial court did not hear evidence or observe witness demeanour; the case for maximum compensation was not adequately laid out, and the Respondent could still secure other employment. Considering the unfairness of the termination and about two years of service, the court substituted 6 months' salary.

p. 8
03

Whether the trial court erred in awarding service pay and house allowance

Holding

Yes - both awards were set aside

Reasoning

Under section 35(6), an NSSF member is not entitled to service pay; payment details at page 35 of the record of appeal showed the Respondent was registered with NSSF. The same payment details showed the Respondent's salary breakdown included house allowance, so the lower court erred in allowing that prayer. The Appellant did not challenge the notice pay, which the court therefore left undisturbed.

p. 8

Legal principles established

#
  • The burden of justifying the grounds for termination lies with the employer, and unproved reasons render termination unfair
  • An employee must be accorded notification and hearing under section 41 of the Employment Act even in cases of gross misconduct
  • An appellate court will only interfere with the exercise of discretion where there is an error leading to an erroneous decision
  • An award of the maximum 12 months' pay must be based on sound judicial principles, with the trial judge justifying the maximum award
  • Under section 35(6) of the Employment Act, an employee who is a member of NSSF is not entitled to service pay

Court orders

#
  1. 1.Six months' salary as compensation for unfair termination of Kshs 93,600/= in substitution of the 12 months' salary awarded by the trial court
  2. 2.One month's salary in lieu of notice of Kshs 15,600/= maintained, bringing the total to Kshs 109,200/=
  3. 3.The trial court's award of service pay set aside, the Respondent being an NSSF member under section 35(6) of the Employment Act
  4. 4.The trial court's award of house allowance set aside, payment details showing the Respondent was paid house allowance
  5. 5.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
Employment and Labour Relations Court (Magistrates' Court)
MCELRC/278/2020
Jurisdiction invoked
Appellate jurisdiction of the Employment and Labour Relations Court over appeals from the subordinate court (Magistrates' Court ELRC jurisdiction)

Relief refused

#

Setting aside the entire judgment of the lower court and dismissal of the Respondent's claim with costs

The court upheld the finding of unfair termination, finding the Appellant had neither valid reasons nor followed fair procedure

p. 7

Maximum compensation of 12 months' salary

The case for maximum compensation was not adequately laid out and the Respondent could still secure other employment

p. 8

Costs

The appeal being partially successful hence 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. 6 Months' salary as compensation for unfair termination Kshs 93,600 /= b. One-month salary in lieu of Notice Kshs 15,600/= Total Kshs 109,200/=
p. 8Final orders - partial success and substituted awards
The appeal being partially successful hence each party shall bear their own costs of this Appeal.
p. 9Costs order
In conclusion the court finds that the Appellant had no valid reason to dismiss the Respondent and equally failed on the procedure under section 41 of the Act hence this amounted to unfair termination under section 45 of the Act.
p. 7Unfair termination - valid reasons and procedure
The court fully agrees with the trial court that due procedure was not followed as provided for under section 41 of the Employment Act.
p. 7Procedural fairness
The court will therefore allow this ground of appeal and substitute the 12 months compensation with 6 months' salary due to unfairness of the termination and the fact that the Respondent had served the Appellant for around two years.
p. 8Compensation reduced to 6 months
The court therefore finds that the trial court erred in awarding service pay. This ground of appeal is therefore allowed.
p. 8Service pay - NSSF membership

Issues in the judgment

#
minor

The judgment's ground (v) states the trial court found the Respondent 'was never notified of the charges' while ground (vi) states the trial court found the Respondent 'was not present during the disciplinary hearing', and the Appellant's own submissions describe these as contradictory findings by the trial court

minor

The judgment repeatedly transposes the parties' roles when discussing the desertion ground, referring to the Appellant where the Respondent is meant

Key timeline

#

Practical implications

#

Frequently asked questions

#

Cite this brief

#

Cite this brief

Caselaw, "Anirita Poultry Farms Ltd v Juma (Appeal E269 of 2023) [2024] KEELRC 2487 (KLR)", Case Analysis (2024). Memorandum of Appeal dated 22nd December, 2023. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2024/2487/eng@2024-10-11

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