Teresia Wanjiku Njoroge v G. North & Son Ltd & 4 others

of constructive dismissal. By an amended statement of claim dated 20 th February 2023, the Claimant sought for the following relief against the Respondentsa) A declaration that the Respondents have breached and violated its contractual obligations to the Claimant. b) A declaration that the 1st Respondent has breached and violated its fiduciary duty owed to the Claimant. c) A declaration that the actions of the 1 st Respondent amounted to constructive dismissal. d) An order for special damages for constructive dismissal. e) An order for exemplary damages for unlawfully retaining the Claimant’s provident fund and loan repayment monies for the Respondent’s own use. f) Certificate of service. g) Interest on (d) and (e) herein. h) Costs of the suit. 2. The Claimant’s claim was accompanied by her witness statement dated 20 th February 2023; list of witnesses of even date; and list and bundle of documents of even date. 3. In response to the claim, the 2nd Respondent entered appearance through the law firm of Ronn Law Advocates LLP, and filed a memorandum of response dated 15th June 2022. In support of their response, the 2 nd Respondent filed their list of witnesses dated 15th June 2022; witness statement of SAM ODERA of even date; and a list and bundle of documents of even date. The same law firm of Ronn Law J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 2 | 26

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Advocates LLP later entered appearance for the 3rd and 4th Respondents and filed a memorandum of response on their behalf dated 8 th October 2024. The same was accompanied by a list of witnesses of even date; witness statements of SAM ODERA and VICTOR MWANGO both of even date; and a list and bundle of documents of even date. 4. On its part, the 5th Respondent entered appearance through the law firm of Wainaina Ireri Advocates LLP, and filed a statement of defence dated 8 th November 2023. The same was accompanied by a witness statement of GILBERT KISIAH dated 22nd April 2024. 5. To counter the 5th Respondent’s case, the Claimant filed a Reply dated 31 st January 2024. Hearing and evidence 6. The case was heard to completion by Justice Nderi Nduma (as he then was). The parties agreed that I write the judgment, relying on the typed proceedings. The claimant’s case was heard on 9 October 2024, when she testified as CW1, adopted her witness statement dated 20 February 2023, and produced her documents as exhibits C. She was cross-examined by counsel for the respondent. 7. The respondent’s case was heard on the 21st January 2026. RW1 was Samuel Otieno Odera who adopted his statement dated 8th October 2024. He produced the respondent’s documents as exhibits 1 -7. RW1 was cross-examined by J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 3 | 26

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counsel for the 5th Respondent and for the claimant. He was cross-examined by counsel for the 3rd and 4th respondents. RW2 was Victor Kiema Mwango (for 3 rd and 4th respondents) and adopted his witness statement dated 8 th October 2024 and was cross-examined by counsel for the claimant and the 5 th respondent. The 5th Respondent called Gilbert Kisiah as its witness, adopted his witness statement 22nd April 2024. The Claimant’s case in summary 8. The Claimant’s case was that she was employed by the 1 st Respondent on 15th August 2011 vide a letter of offer of employment bearing the same date, at the position of account assistant in the cash office. She was placed on probation for three months, and her employment was confirmed thereafter on 30th August 2012, at which point her entitlement to all employee benefits matured. The letter of offer of employment contained terms regarding remuneration, territory, and probation period, and indicated that all other terms and conditions of employment would be in accordance with the Mitchell Catts Kenya (Group) General Instructions No. 6/1, revised September 2006. Further, upon confirmation, the Claimant was provided with, and informed that she was subject to, the Mitchell Catts Kenya (Group) Standard Terms for Locally Engaged Staff, which laid out the terms and Conditions of employment in respect of staff locally engaged by the 1st Respondent. 9. It is averred that the Claimant was employed under a tripartite agreement between herself and the 1st and 2nd Respondents, whereby she was directly J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 4 | 26

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within the employ of G. North & Son Limited, the 1 st Respondent, but the Mitchell Catts Kenya (Group) General Instructions expressly provided that the 1 st Respondent was a member of the Mitchell Catts Kenya Group. 10. One of the key terms of employment highlighted by the Claimant which was contained within the Mitchell Catts Kenya (Group) Standard Terms for Locally Engaged Staff was that upon completion of the probation period and confirmation as permanent employees, staff became members of the Retirement Benefits Scheme of the Mitchell Catts Group, Kenya. Pursuant to this term, she states that she became a member of the 2 nd Respondent's Retirement Benefits Scheme, and was subjected to pension deductions from her monthly salary. 11. Over the duration of her employment, the Claimant avers that she served the Respondents as an account assistant, Credit Controller and Accountant. She received several promotions and salary increments following the annual yearly reviews, with her salary increasing from Kshs. 35,000 to Kshs. 63,750 by the time of the parties’ separation. 12. The Plaintiff’s case is that her troubles with the Respondents began in early 2020, when the 1st Respondent delayed payment of her monthly salary for several months. The issue escalated when the 1st Respondent failed to pay her monthly salary for June, July, October and November 2020, and for January to April 2021, and/or to remit her statutory deductions and pension contributions, despite deducting them from her salary. Prior to this, the Claimant states that she had applied for and been granted a loan facility by KCB Bank Limited on 13th April 2018, and had authorised the repayments to be deducted from her monthly J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 5 | 26

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salary. However, she received a letter from KCB Bank Limited dated 10th March 2019 indicating that her loan was in arrears because the 1st Respondent had not remitted her monthly instalments since January 2019. The 1st Respondent’s failure to remit her loan instalments resulted in breach of contract, a late payment penalty, and an adverse listing with the Credit Reference Bureau. Further, the adverse Credit Reference Bureau listing adversely affected the Claimant’s credit ratings, thereby impairing her ability to obtain financing from other sources. The Claimant states that the loan issued to her by KCB Bank Kenya Limited continues to accrue interest and attract late payment penalties to date. 13. The Claimant avers that on 26 March 2021, an internal memo was circulated among staff announcing the closure of the 1st Respondent’s office for isolation and fumigation to mitigate the spread of COVID-19, and directing employees of the Nairobi office to work remotely until 13 April 2021. However, on 12 April 2021, the 1st Respondent company circulated messages through the Human Resource Department stating that the offices would not open on 13 April 2021 as anticipated. The message stated that new opening dates would be communicated. The Claimant states that, due to the Respondents’ failure to address her grievances and the unsustainable working conditions they created, she was forced to resign. Respondents’ case in brief 2nd, 3rd and 4th Respondents case J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 6 | 26

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14. The 2nd, 3rd and 4th Respondents clarify that there is no existing entity by the name MITCHELL COTTS KENYA GROUP, the 2 nd Respondent herein, but rather MITCHELL COTTS KENYA GROUP is a name that was coined to refer to Michell Cotts Kenya Limited and its subsidiaries, Mitchell Cotts Freight Kenya Limited; Mitchell Cotts Shipping; G. North & Son Limited; and Manson Hart Kenya Limited. They state that each entity was a distinct and separate legal entity and a participating employer/founder in a pension scheme administered by ICEA Lion Trust Company Limited, with each entity being responsible for its own employees. The said pension scheme was set up under the name "Mitchell Cotts Group in Kenya Staff Provident Fund." 15. The 2nd, 3rd and 4th Respondents deny that the 3rd Respondent was involved in a tripartite employment arrangement with the Claimant and 1 st Respondent and/or that it owes her employment benefits, and instead emphasise that the 3 rd Respondent is a distinct and separate legal entity from the 1 st Respondent, as evidenced by official searches obtained from the Companies Registry. They further deny that there has ever existed an employer-employee relationship between the Claimant and the 3rd Respondent, and state that none of the documents produced in court by the Claimant relate to or were issued by the 3 rd Respondent. 16. It is averred that the 3rd Respondent had very limited interactions with the 1st Respondent, as they had common shareholders and were both subsidiaries of Mitchell Cotts Kenya Limited. However, the 1st Respondent ceased to be a subsidiary of Mitchell Cotts Kenya Limited around June or July 2014, when its J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 7 | 26

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shares in the 1st Respondent were sold to Sarastro Holdings Limited and Paul Wanderi Ndung'u. In addition to both being subsidiaries of Mitchell Cotts Kenya Limited, the 1st Respondent was a tenant of the 3rd Respondent at various premises owned by the 3rd Respondent, including the Mitchell Cotts Logistics Centre on Mombasa Road, Nairobi, between 2012 and 2019. The tenancy relationship terminated when the 1st Respondent vacated the premises. The 3rd Respondent is adamant that none of its engagements with the 1st Respondent involved the Claimant. 17. With respect to the 4th Respondent, the 2nd, 3rd and 4th Respondents’ case is that the 4th Respondent is a dormant company which ceased its operations sometime in the year 2000. As such, the Claimant’s allegation that she was employed by the 4th Respondent in the year 2011 cannot possibly be true, as the 4th Respondent was not in operation at that time. 18. The 2nd, 3rd and 4th Respondents therefore take the position that the Claimant has no reasonable cause of action against them and there is no basis for any compensation being ordered or other relief being granted as against the them. They further state that the Claimant's complaints and claims in relation to unremitted pension fall within the purview of the Retirement Benefits Authority and the Retirement Benefits Appeals Tribunal. It is their prayer that the Claimant's claim against the 2nd, 3rd and 4th Respondents should be struck out and the entire suit against them dismissed with costs. 5th Respondent’s case J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 8 | 26

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19. The 5th Respondent denies that it is related and/or forms part of the 1 st to 4th Respondents' Companies. It clarifies that it has no associations with them and there exists no common shareholding and/or directorships between the 1 st to 4th Respondents on one hand and 5th Respondent on the other hand. 20. Further the 5th Respondents is categorical that the Claimant has never been a current or past employee of the 5 th Respondent at any given time. It therefore avers that it is a stranger to the cause of action established in the Claimant’s claim and prays that the claim against it be dismissed with costs. DETERMINATION 21. The parties took directions on submissions. Issues for determination 22. The claimant identified the following issues for determination in the suita) Whether the claims against the 1st Respondent are uncontroverted and whether the 1st Respondent breached its obligations to the Claimant by failing to pay salaries, failing to remit deductions, failing to make matching provident fund contributions, and converting the Claimant's loan deductions. b) Whether the 2nd Respondent is liable alongside the 1st Respondent, given the composition of the 2nd Respondent as a group of companies, the existence of a tripartite agreement, the 2nd Respondent's creation of the terms and conditions of employment and the provident fund, and its failure to ensure compliance by its member companies. c) Whether the Claimant was constructively dismissed. J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 9 | 26

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d) Whether the Claimant is entitled to the remedies sought and, if so, what distinct awards should be made against the 1st Respondent and the 2nd Respondent, respectively. 23. The 3rd and 4th Respondents submit that the following issues arise for determination by this Honourable Court in respect of the claims against them:A. Whether the 3rd and 4th Respondents had an employment relationship with the Claimant. B. Whether the Claimant has established a tripartite employment arrangement that binds the 3rd and 4th Respondents. C. Whether the 3rd and 4th Respondents were properly joined to these proceedings. D. Whether this Honourable Court has jurisdiction to hear and determine the claims against the 3rd and 4th Respondents. 24. The 5th Respondent case was that it had no employer-employee relations with the claimant thus the court lacks jurisdiction over it. 25. The court finds that in its issues the claimant left out the 3, 4 th and 5th respondents yet stated they were jointly liable for breach of terms of contract. The 3rd respondent raised issue of lack of employer employee relationships with the claimant and denied employment relations with the other respondents. The court then finds that the issues for determination to beA. whether there is proof of employee-employer relationship between the claimant and the 3, 4th and 5th respondents. B. Whether the Claimant has established a tripartite employment arrangement that binds the 3rd, 4th and 5th Respondents. J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 10 | 26

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C. Whether the Claimant was constructively dismissed. D. Whether the claimant was entitled to relief sought The law 26. Section 47(5) of the Employment Act provides for the manner of proving employment claims as follows‘47(5) For any complaint of unfair termination of employment or wrongful dismissal the burden of proving that an unfair termination of employment or wrongful dismissal has occurred shall rest on the employee, while the burden of justifying the grounds for the termination of employment or wrongful dismissal shall rest on the employer.’ 27. The burden of proof is that of balance of probabilities. 28. The fairness of termination is as stated in section 45(2) of the Employment Act to wit ‘A termination of employment by an employer is unfair if the employer fails to prove— (a)that the reason for the termination is valid; (b)that the reason for the termination is a fair reason— (i)related to the employees conduct, capacity or compatibility; or (ii)based on the operational requirements of the employer; and (c)that the employment was terminated in accordance with fair procedure.’ Whether there is proof of employee-employer relationship between the claimant and the 3, 4th and 5th respondents J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 11 | 26

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29. The claimant summarised her case as follows- the Claimant received an offer of employment from the 1st Respondent dated 15th August 2011 as an Accounts Assistant. After a three-month probation period, she was confirmed as a permanent employee effective 30th August 2012. Both the offer letter and the confirmation letter expressly stated that all terms and conditions of the Claimant's employment would be governed by the Mitchell Cotts Kenya (Group) (the 2nd Respondent) General Instruction No. 6/1, the Standard Terms for Locally Engaged Staff. 30. The claimant contended that the General Instruction No. 6/1 was created, issued, and promulgated solely by the 2nd Respondent. It was designed to apply uniformly to all locally engaged staff across every company within the Mitchell Cotts Group. The Mitchell Cotts Group Retirement Benefits Scheme, the provident fund was established, administered, and maintained by the 2nd Respondent. The employer was obliged to deduct the employee's contribution, add a matching employer contribution, and then remit both amounts to the 2nd Respondent's fund. 31. The Claimant contended that she worked faithfully for nearly nine years, with her monthly salary increasing from Kshs. 35,000 to Kshs. 63,750. 32. On the 13th April 2018, the Claimant obtained a personal check-off loan from Kenya Commercial Bank (KCB). She executed a Loan Repayment Memorandum of Understanding, authorising KCB to instruct the 1st Respondent to make J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 12 | 26

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monthly deductions from her salary and remit them directly to the bank. The 1st Respondent accepted this mandate. 33. Beginning June 2020, the 1st Respondent failed to pay the Claimant's salary for the months of June, July, October and November 2020, and for January, February, March and April 2021, eight separate months without any salary. 34. The 1st Respondent deducted the Claimant's monthly provident fund contributions but did not remit them to the 2nd Respondent's scheme, and failed to make matching contributions. 35. The 1st Respondent also deducted the monthly KCB loan instalments but retained those sums for its own use, never remitting them to the bank. 36. The Claimant repeatedly complained to the Respondents, but they ignored her complaints. On 7th May 2021, left with no viable alternative, the Claimant resigned. Even after resignation, the Respondents failed to pay terminal dues or issue a certificate of service. 37. The 1st Respondent did not enter appearance. 38. The 2nd, 3rd and 4th Respondents clarify that there is no existing entity by the name MITCHELL COTTS KENYA GROUP, the 2 nd Respondent herein, but rather MITCHELL COTTS KENYA GROUP is a name that was coined to refer to Michell Cotts Kenya Limited and its subsidiaries, Mitchell Cotts Freight Kenya Limited; Mitchell Cotts Shipping; G. North & Son Limited; and Manson Hart Kenya Limited. They state that each entity was a distinct and separate legal entity and a J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 13 | 26

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participating employer/founder in a pension scheme administered by ICEA Lion Trust Company Limited, with each entity being responsible for its own employees. The said pension scheme was set up under the name "Mitchell Cotts Group in Kenya Staff Provident Fund." 39. The 2nd, 3rd and 4th Respondents deny that the 3rd Respondent was involved in a tripartite employment arrangement with the Claimant and 1 st Respondent and/or that it owes her employment benefits, and instead emphasizes that the 3rd Respondent is a distinct and separate legal entity from the 1 st Respondent, as evidenced by official searches obtained from the Companies Registry. They further deny that there has ever existed an employer-employee relationship between the Claimant and the 3rd Respondent, and state that none of the documents produced in court by the Claimant relate to or were issued by the 3 rd Respondent. 40. It is averred that the 3rd Respondent had very limited interactions with the 1st Respondent in that they had common shareholders and were both subsidiaries of Mitchell Cotts Kenya Limited. However, the 1 st Respondent ceased to be a subsidiary of Mitchell Cotts Kenya Limited around June or July 2014 when its shares in the 1st Respondent were sold to Sarastro Holdings Limited and Paul Wanderi Ndung'u. In addition to both being subsidiaries of Mitchell Cotts Kenya Limited, the 1st Respondent was a tenant of the 3rd Respondent in various premises owned by the 3rd Respondent including in Mitchell Cotts Logistics Centre on Mombasa Road, Nairobi, between 2012 and 2019. The said tenancy relationship terminated when the 1st Respondent vacated the said premises. The J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 14 | 26

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3rd Respondent is adamant that none of its engagements with the 1 st Respondent involved the Claimant. 41. In respect of the 4th Respondent, it is the 3rd and 4th Respondent’s case that the 4th Respondent is a dormant company which ceased its operations sometime in the year 2000. As such, the allegation by the Claimant that she was employed by the 4th Respondent in the year 2011 cannot possibly be true it was not in operation at that time. 42. The 2nd, 3rd and 4th Respondents therefore take the position that the Claimant has no reasonable cause of action against them, and there is no basis for any compensation being ordered or other relief being granted as against them. They further state that the Claimant's complaints and claims regarding unremitted pension fall within the purview of the Retirement Benefits Authority and the Retirement Benefits Appeals Tribunal. It is their prayer that the Claimant's claim against the 2nd, 3rd and 4th Respondents should be struck out and the entire suit against them dismissed with costs. 5th Respondent 43. The 5th Respondent denies that it is related and/or forms part of the 1 st to 4th Respondents' Companies. It clarifies that it has no associations with them and there exists no common shareholding and/or directorships between the 1 st to 4th Respondents on one hand and 5th Respondent on the other hand. 44. Further the 5th Respondents is categorical that the Claimant has never been a current or past employee of the 5 th Respondent at any given time. It therefore J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 15 | 26

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avers that it is a stranger to the cause of action established in the Claimant’s claim and prays that the claim against it be dismissed with costs. Decision on issue No. 1 45. An employer is defined under the Employment Act in section 2 as follows‘ "employer" means any person, public body, firm, corporation or company who or which has entered into a contract of service to employ any individual and includes the agent, foreman, manager or factor of such person, public body, firm, corporation or company; 46. It was not in dispute that the claimant held a contract of employment dated 15th August 2011. The letter of offer stated the claimant was offered employment as an account assistant in G. NORTH & SON LIMITED, the 1 st respondent. The letter was signed for G. North & Son Limited. The contract stated that contract was subject to probation and could be terminated by the said company. The letter, further stated‘all other terms and conditions of employment are as per Mitchell Cotts Kenya (Group) instructions No. 6/1 revised September 2006’. 47. The offer further indicated that the instructions No. 6/1 was enclosed. The claimant accepted the offer. The employment was confirmed vide a letter dated 30th August 2012 by the said company and on same terms. 48. The court perused the said Mitchell Cotts Kenya (Group) instructions No. 6/1 revised September 2006’ (C-exhibits no. 4) It was titled Mitchell Cotts Kenya J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 16 | 26

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(Group) G. North & Son Ltd General Instruction No. 6/1 Standard terms for locally engaged staff(Male or female). The claimant stated that while she was in direct employment of the 1st respondent, the said general instructions expressly provided that the 1st respondent was a member of the Mitchell Cotts Kenya Group and therefore her contract of employment was a tripartite nature as between herself and the 1st and 2nd respondent. 49. During the hearing the claimant said that she had direct employment with the 1st respondent. She told the court she did not work for 3 rd and 4th respondents. Her salary was paid by the 1 st respondent. The pays lips were by the 1 st respondent. The 3rd and 4th respondent had no status on her salary payment. No demand letter was issued to the 3 and 4th respondents. The demand letter was to the 1st respondent only. The claimant admitted that she had no documents from the 5th respondent nor did she issue any demand letter to the 5 th respondent. In reexamination the claimant told the court that in her witness statement she had sued 2nd respondents but the other respondent were sued as related to pension. 50. On perusal of the proceedings the court found it was not in dispute the claimant was an employee of the 1st respondent. The 2nd respondent was not a legal entity but appeared to the court to be comprised of various companies, including the 1st, 3rd, and 4th respondents, who had common standards in terms of staff engaged in Kenya. The 5 th respondent denied association and the claimant in her documents only claimed against the 1st and 2nd respondents. J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 17 | 26

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51. The court finds that the 2 nd respondent being not a legal entity cannot enter into a tripartite agreement between it and the claimant that can bind the 3, 4 and 5th companies which are distinct legal entities. A written contract would be necessary to created obligations and duties for the parties. No such contract was produced. 52. The Employment Act envisages that it is the employer to issue an employment contract. Section 9 (2) states‘2)An employer who is a party to a written contract of service shall be responsible for causing the contract to be drawn up stating particulars of employment and that the contract is consented to by the employee in accordance with subsection (3)’. 53. The agreement before the court did not indicate the members of the group and their relationship. A company is a distinct legal entity. The court finds that the 1st respondent adopted the standard terms to apply to the conditions of employment just like the 3rd and 4th respondents or any other company as shareholders agree, could have done under the contracts held by their direct employees. Adoption of common standards cannot by any stretch of imagination create liability to other parties which have adopted the standards. 54. In the upshot, I hold that the employer of the claimant was the 1 st respondent. The 3rd, 4th and 5th respondents were wrongly joined in the suit as there was no cause of action against them. There was no single document placed before the court to demonstrate the liability of the 3rd, 4th, and 5th respondents for the employment contract of the claimant. All correspondence produced by the J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 18 | 26

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claimant only indicated the 1st respondent as the employer. The claimant produced a document by ICEA Lion Trust Company titled ‘Mitchell Cotts Group Kenya Staff Provident Fund- G North & Son Kenya Limited.’ The policy indicated that the remittance of the pension was by the 1 st respondent. Sharing of staff provident fund by employers cannot create liability on the non-employer members on contributions due from the employer. In any case, even if that was the case, the court has no jurisdiction over pension funds as held by the Supreme Court in Albert Chaurembo Mumbo & 7 others v Maurice Munyao & 148 others; SC Petition No 3 of 2016, [2019] eKLR. At paragraph 146, the Court stated: [146] In our view, once a member leaves the employment of a Sponsor, by becoming a pensioner, there is no longer a relationship of employer-employee that exists between such a pensioner and the sponsor. The relationship that exists in that case becomes that of trustee and beneficiaries (members) of a trust and that relationship is governed by the Retirement Benefits Act, Trustee Act Cap 167 of the laws of Kenya and the general common law on the law of trusts. It is important to note that nowhere in the Employment and Labour Relations Court Act is there jurisdiction conferred on the Employment and Labour Relations court to resolve issues between trustees of a pension scheme and members of the scheme (pensioners).’ 55. In the upshot, I hold the employer was the 1st respondent. The court has no jurisdiction over pension funds. Consequently, I hold that the 2nd, 3rd, 4th, and J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 19 | 26

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5th respondents were wrongly joined in the suit and strike out their names from the suit. Whether the Claimant has established a tripartite employment arrangement that binds the 3rd, 4th and 5th Respondents. 56. From my findings in issue no. 1, I return in the negative. Whether the Claimant was constructively dismissed. 57. The 1st respondent, the employer, did not enter an appearance. The claim for constructive dismissal was thus undefended. The burden of proof of constructive dismissal is with the employee, as held in Coca Cola East & Central Africa Limited v Maria Kagai Ligaga [2015] KECA 394 (KLR) , also cited by the claimant. There is no provision of constructive dismissal in Kenyan statutes. It is a common law doctrine. The Court of Appeal in the case outlined the threshold to apply in a claim of constructive dismissal as follows: ‘The legal principles relevant to determining constructive dismissal include the following: a. What are the fundamental or essential terms of the contract of employment? b. Is there a repudiatory breach of the fundamental terms of the contract through conduct of the employer? c. The conduct of the employer must be a fundamental or significant breach going to the root of the contract of employment or which shows that J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 20 | 26

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the employer no longer intends to be bound by one or more of the essential terms of the contract. d. An objective test is to be applied in evaluating the employer’s conduct. e. There must be a causal link between the employer’s conduct and the reason for employee terminating the contract i.e. causation must be proved. f. An employee may leave with or without notice so long as the employer’s conduct is the effective reason for termination. g. The employee must not have accepted, waived, acquiesced or conducted himself to be estopped from asserting the repudiatory breach; the employee must within a reasonable time terminate the employment relationship pursuant to the breach. h. The burden to prove repudiatory breach or constructive dismissal is on the employee.” i. Facts giving rise to repudiatory breach or constructive dismissal are varied.’ 58. The claimant stated she was not paid salary for 8 months, and further the employer did not remit deducted bank loans and contributions to the provident fund. she stated that she resigned on the 7 th May 2021. The burden to prove repudiatory breach or constructive dismissal is on the employee (Coca-Cola case above). The court, on perusal of the documents produced by the claimant, did not find the resignation letter by the claimant. The letter dated 7th may 2021 was a demand letter for unpaid salary, benefits, and remittances by Rachier Advocates. The letter indicated that the claimant had presumed J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 21 | 26

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constructive dismissal for repudiation of the contract and had tendered her resignation. The court finds there is no standard way of resignation under the law. The advocate is a recognised agent under the Civil Procedure Act and rules. The advocates stated they had instructions to tender the resignation. I find the claimant met one of the conditions of having resigned on grounds of repudiation of the contract for lack of payment of salary, non-remittance of loan deductions and contributions to the provident fund. The court noted that the 1 st respondent responded to the demand letter, but the claimant omitted to produce the response. The court found that the claim for non-remittance of salary was not defended. The claimant stated that salary was not paid in the months of June, July, October, and November 2020, and in January to April 2021. This was the same claim in the demand letter, which was responded to by the 1 st respondent in letter dated 11th May 2021 referred to in letter dated 17th May 2021 by the claimant. The claim appeared to have been admitted with a defence of COVID-19 impact. 59. The claim for loan was supported by check-off forms (c-exhibit 12). There was a demand by the bank, dated 4th June 2021, post-resignation, to the effect that no remittance had been made since January 2019 (C-exhibit 15). The court finds that the non-payment of salary constitutes a material breach of the employment contract. The employee is only on the shop floor in exchange for services with wages. The court, for the foregoing reasons, holds that the claimant was entitled to hold themselves as constructively dismissed. 60. The claim for constructive dismissal is proved on the balance of probabilities. J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 22 | 26

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Whether the claimant was entitled to relief sought 61. The claimant sought various reliefs which are considered as follows- i) On the orders sought of a declaration that the Respondents have breached and violated its contractual obligations to the Claimant; and A declaration that the 1st Respondent has breached and violated its fiduciary duty owed to the Claimant; and A declaration that the actions of the 1 st Respondent amounted to constructive dismissal. I returned in the positive having held the Claimant was constructively dismissed from employment of the 1st Respondent. ii) The claimant sought 8 months' salary arrears of Kshs. 324,852. The claim for non-payment of salary for the months of June, October, November 2020 and January to 1pril 2021 was consistent with the demand letter dated 7th May 2021 and was undefended. I find the claim is proved on a balance of probabilities and is allowed for Kshs. 324,852. iii) The claimant prayed for payment for annual leave in lieu of Kshs. 60,750. On perusal of her witness statement, the court found no pleading on the issue of leave. What was the period of accrued leave, how many days? The claimant had the burden to plead the claim for untaken leave days with precision. The court found the claim for leave was not proved on a balance of probabilities. iv) The claim for provident fund lies with the Retirement Benefits Authority. The court has no jurisdiction over pension funds. J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 23 | 26

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v) The claim for unremitted loan for Kshs. 319,451.64 is supported by a letter by the KCB bank dated 4th June 2021, which indicated there was a check off of 13th April 2018 for a loan of Kshs. 320 ,000 repayable at Kes. 10,024 over 42 months had not been remitted since January 2019. It was obvious to the court that the 1st respondent was only responsible for the loan up to the date of resignation. The loan was taken in April 2018. It was repayment in 42 months. As at January 2021 payslip, the loan amount due was Kshs. 90,216. That is if the deductions had been remitted as per check off. The payments then, for the months as of end April, the loan balance would be 10024 x 4 (Kshs 40,096), leaving a loan due from the end of April 2021 of Kshs. 50,120/of which is the burden of the claimant. Thus, the due amount for which the employer is responsible, after deducting the amount under check-off and failing to remit, is Kshs. 319,451.64 LESS Kshs. 50120 thus Kshs. 269,331.64 plus accrued interest effective 1st May 2021. j) On compensation for constructive dismissal – the court considered that the non-payment of salary was just post the COVID-19 pandemic, which affected business adversely. The court has taken judicial notice of that fact. The court, however, noted that the deductions for loan non-remittance had already begun. The claimant had worked for almost 10 years. There was no evidence placed before the court why the claimant could not find a similar job in the market to mitigate her losses. The court, for the foregoing reasons, awards the claimant 6 months' compensation for the constructive dismissal. The claimant pleaded a salary of KSS 63,750, supported by a payslip produced for J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 24 | 26

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January 2021. Thus, 63750 x 6; thus compensation awarded at gross salary Kshs. 382,500/-. k) Certificate of service. The same is a right of the claimant and ought to be issued pursuant to section 51 of the Employment Act Disposition 62. The claim is allowed against the 1st respondent only as followsa. A declaration that the claimant was constructively dismissed from employment by the 1st respondent for non-payment of salary and nonrepayment of the deducted loan amounts. 63. The 1st respondent to pay the claimant as followsa. Claimed Unpaid salary for 8 months for Kshs. 324,852. b. Unremitted loan of Kshs. 269,331.64 plus accrued interest effective 1 st May 2021. c. Compensation for constructive dismissal equivalent to 6 months' gross salary. 382,500/Total sum Kshs. 976,683.64. d. Costs and interest at court rate. e. Certificate of service to issue pursuant to section 51 of the Employment Act through the claimant’s advocates within 30 days of this Judgment. 64. Stay of 30 days granted. 65. It is so Ordered. J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 25 | 26

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DATED, SIGNED, AND DELIVERED VIRTUALLY AT NAIROBI THIS 25 TH DAY OF SEPTEMBER, 2026. JEMIMAH KELI, JUDGE. IN THE PRESENCE OF: Court Assistant: Otieno Claimant: Amimo h/b Ometo 1st Respondent: no appearance 2nd respondent -absent 3rd and 4th respondents Lepski h/b Omondo 5th respondent - Njuguna J U D G M E N T I N N A I R O B I E L R C C A U S E N O . E 8 2 7 O F 2 0 2 1 P a g e 26 | 26

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