Weithaga Farm Extension Limited v Maina Ng'ang'a

2. According to the Respondent, he continued reporting to the Appellant’s premises, but Mr. Mbugua declined to assign him any work. He averred that on 10th January 2020, he was instructed to report to the Appellant’s premises on 14th January 2020 to collect his final dues, having been informed that his services had been terminated. He further averred that despite the Appellant’s undertaking to settle his terminal dues, the same remained unpaid. 3. The Respondent contended that the termination of his employment was unlawful and unfair, and contrary to the Constitution, the Employment Act and the principles of fair labour practices. He maintained that he had committed no misconduct warranting his dismissal and that the Appellant neither issued him with notice of the intended termination nor subjected him to due process. 4. Consequently, the Respondent sought an award of Kshs. 1,263,647.00, comprising one (1) month’s salary in lieu of notice, unpaid public holidays for 12 years, service pay, accrued leave pay for 12 years, unpaid overtime, unpaid house allowance, underpaid salary, and compensation for unfair termination. He also sought a declaration that the termination of his employment was unfair and unlawful, as well as the costs of the suit. 2

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5. In opposition to the Claim, the Appellant filed a Statement of Defence dated 19th April 2021, contending, in the first instance, that the suit was statute-barred, having been instituted out of time without leave of the Court. 6. The Appellant further denied that the Respondent was its employee, maintaining that he had not produced a letter of appointment to confirm the existence of an employment relationship. 7. According to the Appellant, the Respondent was initially engaged as a casual coffee picker and only worked as a watchman on rotational shifts for a period of three (3) years. The Appellant averred that the Respondent was granted one (1) day off each week, did not work overtime or on public holidays, and had no outstanding leave entitlement. 8. The Appellant further averred that the Respondent was offered accommodation by the company but declined it and was therefore not entitled to a house allowance. 9. The Appellant denied unlawfully terminating the Respondent’s employment and maintained that the termination was effected in strict compliance with the applicable labour laws. 3

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10.On account of the foregoing, the Appellant urged the Trial Court to dismiss the Respondent's claim with costs. 11.The suit proceeded for hearing before the Trial Court on 24 th October 2023, during which both parties adduced oral and documentary evidence and subsequently filed written submissions. During the hearing, the Respondent testified on his own behalf, while the Appellant called one witness, Mwangi Gathuri, a director of the company. 12.Having considered the pleadings, the evidence on record, and the parties' respective submissions, the learned Trial Magistrate entered judgment in favour of the Respondent as prayed. In allowing the Respondent’s Claim, the Trial Court found that the Respondent was an employee of the Appellant and had been engaged for more than 24 hours and that his wages were paid on a monthly basis and beyond the period allowed for a casual employee. Consequently, the Trial Court held that by operation of Section 37 of the Employment Act the Respondent’s casual employment automatically converted into term employment, thereby entitling him to the statutory protections afforded under the Act. 4

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The Appeal 13.Dissatisfied with the decision of the Trial Court, the Appellant lodged the present Appeal, advancing the following six (6) grounds in support thereof: 1) THAT the Learned Magistrate erred in law and fact by finding for a Claimant who, without any reasonable explanation or leave of the Court, failed to appear to prosecute her claim. 2) THAT the Learned Magistrate erred in law and fact in making a finding that the Respondent worked continuously from 1993 contrary to documentary evidence before the Court.in reaching 3) THAT the Learned Magistrate erred in law and fact in reaching the conclusion that the Appellant deducted dues of NSSF from the Respondent’s wages without any proof and further failing to appreciate that membership to NSSF is retained by a member regardless of the number of times the member may change employment. 4) THAT the Learned Magistrate erred in law and fact by awarding amounts that were neither enumerated nor explained. 5) THAT the Learned Magistrate erred in law and fact by imputing an admission to the Claim by the Appellant contrary to the evidence of the Appellant’s witness and further by shifting the burden of proof from 5

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the Respondent to the Appellant in an apparent claim for liquidated damages. 6) THAT the Learned Magistrate erred in law and fact for disregarding uncorroborated documentary evidence tendered by the Appellant, thus showing open bias against the Appellant. 14.Consequently, the Appellant prays that the Judgment of the Trial Court delivered on 23rd April 2025, together with all consequential orders and the decree, be set aside and an order do issue dismissing the Respondent's claim in Murang'a CMELRC Cause No. 18 of 2020 in its entirety. The Appellant further seeks the costs of both the Appeal and the proceedings before the Trial Court. The Submissions 15.The Appeal was canvassed by way of written submissions. On its part, the Appellant submitted that although the Trial Court correctly cited the law governing casual employment and its conversion into term employment, it failed to consider the evidence it (Appellant) had adduced regarding the nature of the Respondent's engagement. In this regard, the Appellant maintained that the Respondent did not qualify for conversion under Section 37 of the Employment Act and could not therefore invoke the said provisions with regard to his terms and conditions of employment. 6

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16.The Appellant further contended that there was no evidence that the Respondent was employed in 1996. 17.The Appellant further submitted that it had adduced evidence demonstrating the specific days during which the Respondent worked and did not work, and that, in the circumstances, he was not entitled to payment in respect of annual leave. 18.The Appellant further contended that the Trial Court wrongly exercised its judicial discretion as she did not give any reason for awarding the Respondent maximum compensation. 19.It was further submitted by the Appellant that it proved the number of days the Respondent worked and did not work and that he was not entitled to annual leave 20.On the other hand, the Respondent submitted that having asserted and proved that he was employed by the Appellant for over 10 years, the burden shifted to the Appellant to prove that he had been engaged on specific terms of employment, in accordance with Sections 9, 10 and 11 of the Employment Act. He further submitted that even if he was a casual employee, it was incumbent upon the Appellant to demonstrate compliance with the relevant provisions of 7

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Section 37 of the Employment Act. That similarly, where there had been any change in the terms of his employment, the Appellant was required to demonstrate that he had been duly notified pursuant to Section 13 of the Employment Act. 21.The Respondent contended that the muster roll produced by the Appellant was unreliable, as it contained missing pages and dates and did not disclose the terms upon which he had been engaged. In his view, the muster roll was therefore of little evidentiary value. 22.It was further submitted that the nature of the Respondent’s engagement as a Security Guard (Watchman) undermined the Appellant’s assertion that he was engaged intermittently and only during peak seasons, as opposed to off-peak periods. 23.Referencing the case of Kenyatta University v Maina (Civil Appeal 261 of 2020) [2022] КЕСА 1201 (KLR), the Respondent posited that an employer cannot mask itself from any liabilities appurtenant to their unfair and unlawful labour practices by holding employees under the guise of there being peak and off-peak seasons. 8

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Analysis and Determination 24.As this is a first appeal, this Court is obligated to reconsider, re-evaluate, and re-analyse the entire evidence on record, together with the impugned Judgment, and to draw its own independent conclusions. In undertaking that exercise, however, the Court must remain mindful that it neither saw nor heard the witnesses testify and should therefore accord due deference to the Trial Court's findings on matters of credibility. This principle was aptly restated in the case of Abok James Odera t/a A.J Odera & Associates v John Patrick Machira t/a Machira & Co. Advocates [2013] eKLR. 25.Being mindful of the Court's mandate on a first appeal, and upon considering the grounds set out in the Memorandum of Appeal, the Record of Appeal in its entirety, the rival submissions and the applicable law, the Court has isolated the following issues for determination: a) Whether the Trial Court erred in finding that the Respondent's engagement as a casual employee had automatically converted into a term contract; b) Subject to the determination of issue (a), whether the Respondent's employment was unfairly terminated; 9

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c) Subject to the determination of issue (b), whether the reliefs awarded to the Respondent by the Trial Court are sustainable in law. Conversion of the Respondent’s employment to a term contract 26.Before the Trial Court, the Respondent asserted that he was in the continuous employment of the Appellant from 10th June 2013 until 3rd January 2020, when he was ordered by one Stephen Mbugua to leave the Appellant’s premises. The Appellant, on the other hand, contended that the Respondent was initially engaged as a casual coffee picker and only worked as a watchman on rotational shifts for a period of three (3) years. 27.In support of its case, the Appellant produced before the Trial Court muster rolls covering the period from December 2011 to August 2019. The records indicate that between 21st May 2013 and 20th June 2013, the Respondent worked for 11 days; between 21st June 2013 and 20th July 2013, he worked for 15 days; between 21st July 2013 and 20th August 2013, he worked for 15 days; between 21st August 2013 and 20th September 2013, he worked for 15 days; and between 21st September 2013 and 20th October 2013, he worked for 15 days. 10

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28.The records further indicate that the Respondent worked for 16 days between 21st October 2013 and 20th November 2013, 15 days between 21st November 2013 and 20th December 2013, and 15 days between 21st December 2013 and 20th February 2014. 29.In essence, a perusal of the entire record indicates that the Respondent worked continuously through 2013, 2014, 2016, 2017, 2018 and up to August 2019. Notably, the Appellant did not produce the muster roll for the year 2015. 30.Under Section 2 of the Employment Act, 2007, a casual employee is defined as follows: “A person the terms of whose engagement provide for his payment at the end of each day and who is not engaged for a longer period than twentyfour hours at a time.” 31.In essence, a casual employee is one whose engagement is on a day-to-day basis, with each engagement not exceeding 24 hours. Under Section 35(1)(a) of the Employment Act, such employment is terminable by either party at the close of the day without the necessity of notice. 11

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32.As stated hereinabove, the record demonstrates that the Respondent remained in continuous employment from 2013 until August 2019. His engagement therefore extended well beyond 24 hours and could not, by that fact alone, fall within the definition of casual employment under Section 2 of the Employment Act, 2007. 33.Having established that the Respondent’s engagement extended beyond 24 hours and, in fact, continued for close to six (6) years, it follows that, by virtue of Section 37 of the Employment Act, 2007, even if his engagement commenced as casual employment, it subsequently converted into a contract of service under which wages are payable monthly and to which Section 35(1)(c) of the Act applies. 34.In the circumstances, and with regard to the facts of the present case, I find no error in the Trial Magistrate’s conclusion that the Respondent’s employment converted into a term contract by operation of law. 35.This finding brings me to the next issue for determination, namely, whether the Respondent’s employment was unfairly terminated. Unfair termination of employment 36.Having found that the Trial Magistrate correctly held that the Respondent’s employment had converted by operation of law into a term contract, it follows 12

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that the Respondent was entitled to the statutory protection against unfair termination. 37.Consequently, the Appellant was required, pursuant to Sections 43 and 45(2)(a) and (b) of the Employment Act, to prove the reasons for the termination and demonstrate that those reasons were valid, fair and related to the Respondent’s conduct, capacity or compatibility, or were based on the Appellant’s operational requirements. 38.The Appellant was further required to demonstrate that the Respondent was accorded a fair hearing in accordance with Section 41 of the Employment Act. 39.At the Trial Court, the Appellant’s defence on this issue was that the Respondent’s employment had been terminated in accordance with the applicable labour laws. Notwithstanding this assertion, the Appellant neither disclosed nor advanced any reason for the termination of the Respondent’s employment. 40.In the absence of a reason for termination, there is consequently no basis upon which the Court can interrogate its validity or fairness against the criteria set out in Sections 45(2)(a) and (b) of the Employment Act. 13

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41.It follows, therefore, that the Respondent’s employment was terminated without the Appellant establishing a valid and fair reason, contrary to Sections 43 and 45(2)(a) and (b) of the Employment Act. 42.What’s more, there is no evidence that the Respondent was notified, prior to the termination, that the Appellant was contemplating bringing his employment to an end or was considering taking any disciplinary action against him. 43.Therefore, the Appellant also failed to demonstrate compliance with the procedural safeguards for fair termination prescribed under Section 41 of the Employment Act. 44.Accordingly, this Court finds that the termination of the Respondent’s employment was both substantively and procedurally unfair. Remedies? 45.It is noteworthy that the Trial Court granted the Respondent all the reliefs sought in the Memorandum of Claim, including compensation for unfair termination equivalent to 12 months’ salary, being the maximum award permissible under Section 49(1)(c) of the Employment Act. 46.As held by the Court of Appeal in Kenya Revenue Authority v Mwongela [2025] KECA 262 (KLR), the Court’s discretion under Section 49(1) of the 14

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Employment Act must be exercised judicially, taking into account all relevant factors and ensuring fairness to all parties. 47.Indeed, Section 49(4) of the Employment Act specifically enumerates 13 factors to guide the Court in determining the quantum of compensation for wrongful dismissal or unfair termination. 48.In the present case, the trial Court did not indicate any factor considered in awarding the maximum compensation. 49.Given that 12 months’ salary represents the maximum compensation under Section 49(1)(c) of the Employment Act, it was reasonably expected that the trial Court would identify special circumstances justifying the award of the full statutory limit. 50.In view of the foregoing, and guided by the principle of “a fair go all round,” this Court finds that an award equivalent to 12 months’ salary would be excessive in the circumstances of the present case. Having regard, in particular, to the length of the employment relationship, the Court considers compensation equivalent to seven (7) months’ salary to be fair and reasonable for the unfair termination. 15

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51.In addition to the foregoing, and having found that the termination of the Respondent’s employment was substantively and procedurally unfair, this Court awards him one (1) month’s salary in lieu of notice. 52.The Trial Court further awarded the Respondent payment for accrued annual leave for 12 years, as pleaded and prayed. 53.Section 28(4) of the Employment Act prescribes the timeframe within which an employee must take statutory annual leave, preventing indefinite accumulation and potential forfeiture. Under this provision, an employee is required to take leave within the initial 12 consecutive months in which it is earned, with any remaining leave to be taken no later than 18 months after the end of the leaveearning period. 54.Applying Section 28(4) to the present case, it is clear that the Respondent is entitled to recover accrued leave only up to a maximum of 18 months, rather than the 12 years claimed and awarded by the Trial Court. 55.The Respondent further claimed that his salary had been underpaid during the entire duration of his employment with the Appellant. Although the Trial Court awarded him the amount claimed under this head, it did not undertake a 16

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comparison between the salary pleaded as having been earned and the applicable statutory minimum wage during the relevant periods. This was an error on the part of the Trial Court. 56.The Respondent pleaded that he was employed by the Appellant as a security guard with effect from 10th June 2013. Accordingly, pursuant to Legal Notice No. 197 of 2013, he was entitled to a consolidated monthly salary, inclusive of house allowance, of Kshs. 7,157.14, being Kshs. 6,223.60 plus 15% thereof, for the period from 10th June 2013 to 30th April 2015. Since it is undisputed that the Respondent was earning a monthly salary of Kshs. 8,400.00 during this period, it follows that he was not underpaid. 57.For the period from 1st May 2015 to 30th April 2017, Legal Notice No. 117 of 2015 prescribed a consolidated monthly salary, inclusive of house allowance, of Kshs. 8,015.96, being Kshs. 6,970.40 plus 15% thereof. In view of the Respondent’s monthly salary of Kshs. 8,400.00, it follows that he was not underpaid during this period. 58.For the period from 1st May 2017 to 30th April 2018, the applicable minimum consolidated monthly salary, inclusive of house allowance, was Kshs. 9,458.81, being Kshs. 8,225.05 plus 15% thereof, pursuant to Legal Notice No. 112 of 17

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2017. As the Respondent continued to earn Kshs. 8,400.00 per month, he was underpaid by Kshs. 1,058.81 per month during this period. 59.With effect from 1st May 2018 until 3rd January 2020, when the Respondent contended that his employment was terminated, the applicable minimum consolidated monthly salary, inclusive of house allowance, was Kshs. 9,931.75, being Kshs. 8,636.30 plus 15% thereof, pursuant to Legal Notice No. 2 of 2018. Since the Respondent continued to earn Kshs. 8,400.00 per month, he was underpaid by Kshs. 1,531.75 per month during this period. 60.In light of the foregoing, this Court is satisfied that the Respondent was underpaid during part of his employment and is therefore entitled to the amount established as due on account of such underpayment. 61.The Respondent further sought an award of Kshs. 25,200.00 as service pay for six (6) years. Under Section 35(5) of the Employment Act, an employee whose contract of service is terminated under subsection (1)(c) is entitled to service pay for each completed year of service, the terms of which are to be fixed. 62.It is, however, noteworthy that Section 35(6) sets out circumstances in which an employee is excluded from entitlement to service pay. These include membership in the National Social Security Fund (NSSF), a registered pension 18

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or provident fund scheme, a gratuity or service pay scheme established under a collective agreement, or any other scheme established and operated by an employer whose terms are more favourable than those of the service pay scheme provided under the Act. 63.In the present case, there is no evidence on record demonstrating that the Respondent fell within any of the exclusions contemplated under Section 35(6) aforementioned. He is therefore entitled to service pay at the rate of 15 days’ salary for each completed year of service. 64.The Trial Court also awarded the Respondent compensation for untaken rest days and unpaid overtime as pleaded and prayed. This award was made notwithstanding the absence of evidence demonstrating that the Respondent worked beyond the prescribed normal working hours without corresponding compensation. 65.On this issue, this Court is guided by the decision in Rogoli Ole Manadiegi v General Cargo Services Limited [2016] eKLR, where it was held that although an employer is the custodian of employment records, an employee does not automatically establish a claim for overtime merely because such records are not produced in court by the employer. As the Court rightly held, the burden 19

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remains on the employee to prove that he worked in excess of the legal maximum. 66.In the present case, the Respondent did not demonstrate when he worked extra hours, or when he worked on public holidays or rest days and was not compensated accordingly. 67.As such, the award for unpaid rest days, public holidays and overtime cannot be sustained in the absence of evidence establishing that the Respondent worked during such periods without due compensation. Orders 68.In light of the foregoing, the Appeal partly succeeds. Accordingly, the global award of Kshs. 1,263,647.00 made by the Trial Court is hereby set aside and substituted with the following awards: a) The Respondent is awarded Kshs. 9,931.75, being one (1) month’s salary in lieu of notice, calculated on the basis of the last salary to which he was entitled at the time of termination. b) The Respondent is awarded Kshs. 69,522.25, being compensation for unfair termination equivalent to seven (7) months’ salary. 20

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c) The Respondent is awarded Kshs. 10,428.34 as accrued leave pay, limited to the statutory period of 18 months. d) The Respondent is awarded Kshs. 29,795.25 as service pay for the six (6) completed years of service. e) The Respondent is awarded Kshs. 23,069.12 in respect of salary underpayments for the period from 1st May 2017 to 3rd January 2020. f) The total decretal sum is accordingly revised from Kshs. 1,263,647.00 to Kshs. 142,746.71. g) The decretal sum shall attract interest at court rates from the date of this Judgment until payment in full. 69.Costs in this Court and at the Trial Court shall be borne by the Appellant and shall be pegged on the final award. DATED, SIGNED and DELIVERED at NYERI this 25th day of September 2026. ……………………………… STELLA RUTTO JUDGE In the presence of: For the Appellant Mr. Kimani For the Respondent Mr. Wanyangu instructed by Mr. Namada 21

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Court Assistant Ndati ORDER In view of the declaration of measures restricting Court operations due to the COVID-19 pandemic and in light of the directions issued by His Lordship, the Chief Justice on 15th March 2020 and subsequent direction of 21st April 2020 that judgments and rulings shall be delivered through video conferencing or via email. They have waived compliance with Order 21 Rule 1 of the Civil Procedure Rules, which requires that all judgments and rulings be pronounced in open Court. In permitting this course, this Court had been guided by Article 159(2)(d) of the Constitution which requires the Court to eschew undue technicalities in delivering justice, the right of access to justice guaranteed to every person under Article 48 of the Constitution and the provisions of Section 1B of the Civil Procedure Act (Chapter 21 of the Laws of Kenya) which impose on this Court the duty of the Court, inter alia, to use suitable technology to enhance the overriding objective which is to facilitate just, expeditious, proportionate and affordable resolution of civil disputes. STELLA RUTTO JUDGE 22

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