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ELRCPartially AllowedELRC Appeal No. E030 of 2025

Kingiri v Surtech Ltd & another (Appeal E030 of 2025) [2026] KEELRC 2440 (KLR)

Employment and Labour Relations Court
31 August 2026
2,410 words in judgment
View original judgmentRead on Kenya Law Watch case
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The bottom line

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Kenya's Employment Court confirmed that an employer who stops paying salary constructively dismisses the employee, even if the employer claims the worker absconded.

What this practically means

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Executive summary

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This is a first appeal to the Employment and Labour Relations Court at Nairobi against the judgment of the learned magistrate in Milimani CMELRC E1981 of 2022 delivered on 24 January 2025, in which the appellant's claim for constructive dismissal was rejected. The appellant, employed as a driver from 1988, alleged that the respondents stopped paying his monthly salary from September 2021, constituting a fundamental breach amounting to constructive dismissal, and sought declarations, terminal dues, compensation, accrued leave, notice pay, aggravated damages and a certificate of service. The respondent maintained that the appellant was not terminated but absented himself from work during the COVID-19 pandemic, was paid until November 2021, and that service pay and leave claims were misconceived and time-barred. Allowing the appeal, M. Mbarũ J held that the magistrate failed to make any finding on constructive dismissal. The court found that the admitted non-payment of salary from November 2021 was, under section 44(3) of the Employment Act, a fundamental breach; further, an employer cannot plead abscondment without formally terminating the employment relationship. Reliance on the COVID-19 pandemic without invoking section 40 was inadequate. The court concluded the appellant was constructively and unfairly dismissed and, considering over 33 years of unblemished service, awarded compensation of 10 months' gross salary (Ksh. 636,290), notice pay of Ksh. 63,629 and a certificate of service. Claims for salaries after September 2021, leave of 166 days, service pay, breach-of-contract and aggravated damages were refused. The trial court's judgment was set aside, with costs of the appeal and trial court awarded to the appellant against the 1st respondent.

Questions the Court framed

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

  1. 1.Whether the learned magistrate misapprehended the claim as one of termination by notice rather than constructive dismissal
  2. 2.Whether the respondent constructively and unfairly terminated the appellant's employment
  3. 3.Whether the alleged abscondment/desertion of duty was proved and whether the employer could rely on it without terminating the employment relationship
  4. 4.Whether the appellant was entitled to compensation, notice pay, terminal dues, accrued leave, service pay and other prayers
  5. 5.Whether the claim for leave days and service pay was sustainable

Key legal issues

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01

Constructive dismissal by non-payment of salary

Holding

The respondent's failure to pay salary from November 2021 was an unjustified fundamental breach amounting to constructive unfair dismissal

Reasoning

The respondent admitted no salary was paid from November 2021. Under section 44(3) of the Employment Act non-payment of salary is a fundamental breach. The alleged abscondment was never addressed through termination or a report to the labour officer under section 18(5). Citing Coca Cola v Ligaga and CAFS v Spangler, the breach repudiated the employment relationship and justified a claim of constructive dismissal.

p. 7
02

Employer's duty where abscondment is alleged

Holding

An employer cannot rely on abscondment without formally ending the employment relationship

Reasoning

Following Nyali Academy v Muli and Ayub Kombe Ziro v Umoja Rubber Products, the duty to terminate where an employee is absent without authority rests on the employer. The employer should have summoned the employee and, where absence persists, reported to the labour officer under section 18(5) of the Act. The failure to close the employment relationship exposed the respondent to a claim for constructive dismissal.

p. 7
03

Remedies: compensation and notice pay

Holding

Compensation of 10 months' gross salary (Ksh. 636,290) and notice pay of Ksh. 63,629 awarded for over 33 years of unblemished service

Reasoning

The appellant worked from August 1988 until September 2021 with no record of poor performance filed under section 45(5) of the Act. Compensation of 10 months' gross salary was found appropriate. Notice pay was calculated at the last due salary of Ksh. 63,629. Salaries from September 2021 to date were refused because no service was rendered after September 2021.

p. 8
04

Service pay and leave claims

Holding

Service pay not due under section 35(5); leave cannot be accumulated beyond 18 months under sections 28 and 18 of the Act

Reasoning

The payment statement filed confirmed statutory dues were paid, so service pay was not payable. The magistrate's finding that leave may only accrue for up to 18 months was upheld; payments until November 2021 without service rendered sufficed, and the appellant's claim for 166 accrued leave days failed.

p. 8

Legal principles established

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  • Failure to pay an employee's due salary is a fundamental breach of the employment contract under section 44(3) of the Employment Act, entitling the employee to claim constructive dismissal
  • An employer cannot lawfully plead abscondment without bringing the employment relationship to a close; the duty to terminate rests on the employer
  • Non-payment of salaries for long periods places the employee under inhuman and degrading circumstances and the employment contract no longer binds the employee

Court orders

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  1. 1.The judgment in Milimani CMELRC E1981 of 2022 is set aside
  2. 2.Declaration that employment was terminated through constructive unfair dismissal
  3. 3.Compensation of Ksh. 636,290
  4. 4.Notice pay of Ksh. 63,629
  5. 5.Certificate of service
  6. 6.Costs of the appeal and the trial court proceedings

The bench

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

majority

Wrote the judgment

On appeal from
Milimani Chief Magistrate's Court (CMELRC)
E1981 of 2022
Jurisdiction invoked
First appeal to the Employment and Labour Relations Court against the judgment in Milimani CMELRC E1981 of 2022

Relief refused

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Payment of salaries from September 2021 to date

The appellant did not offer any service to the respondents after September 2021 and was paid until November 2021; compensation for constructive dismissal suffices

p. 8

Damages for breach of contract and aggravated damages

The issue was constructive dismissal, which was particularised and addressed, and the appellant did not address mitigation of loss

p. 8

Accrued/unpaid leave of 166 days (Kshs. 223,213 and Kshs. 80,472)

Annual leave may be accumulated for only up to 18 months; payments until November 2021 without rendering service suffice

p. 8

Service pay at 15 days for 34 years

Statutory dues were paid and service pay is not due under section 35(5) of the Employment Act

p. 8

Costs

Costs of the appeal and trial court proceedings awarded to the appellant against the 1st respondent

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.

Accordingly, the judgment in Milimani CMELRC E1981 of 2022 is hereby set aside. Judgment is entered for the appellant against the 1st respondent in the following terms:
p. 9Final orders setting aside the trial judgment
a) Employment terminated through constructive unfair dismissal. b) Compensation Ksh. 636,290. c) Notice pay Ksh. 63,629. d) Certificate of service. e) Costs of the appeal and trial court proceedings.
p. 9Disposition
where the employer fails to pay the due salary to the employee, under section 44(3) of the Act, there is a fundamental breach of the employment contract.
p. 6Non-payment of salary as fundamental breach
The employer initiates the termination of employment. Without a salary, the employee has no reason to report to work.
p. 6Effect of non-payment on the employment relationship
The lapse in addressing the alleged circumstances of the COVID pandemic, the lapse in failing to bring the employment relationship to a close, opened the respondent to a claim for constructive dismissal.
p. 7COVID-19 and abscondment

Issues in the judgment

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minor

Judgment cites a future-dated authority (Ogada v Kwale International Sugar Co Limited [2026] KEELRC 1790 (KLR)) in a judgment delivered 31 August 2026; internally consistent in year but the citation is unusual

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, "Kingiri v Surtech Ltd & another (Appeal E030 of 2025) [2026] KEELRC 2440 (KLR)", Case Analysis (2026). ELRC Appeal No. E030 of 2025. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2026/2440/eng@2026-08-31

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