Anirita Poultry Farms Ltd v Juma (Appeal E269 of 2023) [2024] KEELRC 2487 (KLR)
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
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Whether the trial learned Magistrate erred in finding that the Respondent was unfairly terminated.
- 2.Whether the trial learned Magistrate erred in awarding the Respondent maximum compensation of 12 months' salary and other awards.
Key legal issues
#Whether the Respondent was unfairly terminated
Yes - the Appellant failed to prove valid reasons for termination and failed to follow the fair procedure under section 41 of the Employment Act
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.
Whether the trial court erred in awarding 12 months' salary as compensation
Yes - the award was reduced to 6 months' salary
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.
Whether the trial court erred in awarding service pay and house allowance
Yes - both awards were set aside
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.
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.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.One month's salary in lieu of notice of Kshs 15,600/= maintained, bringing the total to Kshs 109,200/=
- 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.The trial court's award of house allowance set aside, payment details showing the Respondent was paid house allowance
- 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
Maximum compensation of 12 months' salary
The case for maximum compensation was not adequately laid out and the Respondent could still secure other employment
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/=
The appeal being partially successful hence each party shall bear their own costs of this Appeal.
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.
The court fully agrees with the trial court that due procedure was not followed as provided for under section 41 of the Employment Act.
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.
The court therefore finds that the trial court erred in awarding service pay. This ground of appeal is therefore allowed.
Issues in the judgment
#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
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.