REPUBLIC OF KENYA

IN THE EMPLOYMENT AND LABOUR RELATIONS COURT

AT NAKURU

ELRC CAUSE NUMBER 229  OF 2018

GEORGE MWANGI ...........................................................CLAIMANT

-VERSUS-

HAPPY GO LIMITED.................................................. RESPONDENT

(BEFORE HON. JUSTICE DAVID NDERITU)

JUDGMENT

I. INTRODUCTION

1. In an amended memorandum of claim dated 5^th October,   2018 the Claimant prays for the following:-

A. An order to set aside and declare the same as null  and void the summary dismissal letter dated 20^th  July, 2018 consequently reinstating and/or re- engaging the Claimant to his previous position  without making changes to his wages, allowances  or dues thereto.

B. That the Respondent do issue the Claimant with  adequate compensation as a shareholder in terms  of unpaid dividends. Finance Director in the  terms of unpaid Director Remuneration and as an  Accountant.

C. An order for the Respondent to determine the  shareholding interest of the Claimant with regard  to all capital contributions made from 2006 to  date.

IN THE ALTERNATIVE

D. Kshs.6,920,175/= in wages and benefit due as  currently paid by the Respondent.

D. (i) Unpaid Salary for 23 years – Kshs.23,632,000/=.

E. Damages for unfair/wrongful Dismissal from  employment.

F. Costs and interest at court rates

G.  Any other relief deemed as appropriate.

2. Together with the original memorandum of claim dated  31^st July, 2018 were filed a verifying affidavit by the  Claimant,  Claimant’s witness statement, and copies of  several documents annexed thereto.

3. During the hearing the Claimant abandoned the main  prayers and proceeded to testify in support of the  alternative prayers.  Counsel for Claimant in his written  submissions concentrated on the alternative prayers as he  had informed the court during the hearing that the  Claimant was abandoning the main prayers in favour of  the alternative prayers.

4. In a reply to the amended claim dated 27^th February, 2020  the Respondent prayed for dismissal of the entire claim  with costs for want of merit.  Along with the amended  reply to the claim the Respondent filed witness statements,  list of documents, and copies thereof.

5. This cause proceeded for hearing on 1^st November, 2021  when the Claimant (CW1) testified alone in support of his  case.  The defence was heard on 6^th December, 2021  whereby CATHERINE MWAURA (RW1) testified in  support of the Respondent’s position.

6. Counsel for both parties summed up their respective  positions by way of written submissions, Claimant’s dated  24^th January, 2022 and Respondent’s dated on even date.

II.   CLAIMANT’S CASE

7. Based on the amended statement of claim, the oral  and  documentary evidence tendered, and the written  submissions by his Counsel, the Claimant’s case is that he  was originally engaged by the Respondent in 1995 as a  part-time accountant.

8. The Claimant further alleged that in 1996 he was engaged  on full-time basis at gross salary of Kshs.208,246/= per  month.  He avers that in 2015 the Respondent started  defaulting in paying the monthly salary and other  allowances and that in 2016 the Respondent hired external  auditors to perform the same duties that the Claimant had  been executing.  The Claimant alleged that by 2017 the  Respondent had established a new finance department that  was running parallel functions to that of the Claimant.

9. The Claimant alleged that he complained severally to the  managing director in regard to the parallel department but  no action was taken.

10. On 20^th July, 2018 after a long strained relationship with  the Respondent the Claimant was served with a letter of  summary dismissal from Respondent’s Advocates.  The  said notice stated that the Claimant had absconded duty for  over 12 months which the Claimant claimed to be false  and  total fabrication by the Respondent to allegedly  sanitize what the Claimant considered unfair, wrongful,  and  unlawful dismissal.  The Claimant alleged that as at  the  time of the dismissal he had served the Respondent  for over 20 years.

11. In his oral testimony in court the Claimant testified that he  was not given a hearing before or during the termination or  even thereafter to express and explain his side of the story  and events.  He alleged that as at the time of dismissal his  gross salary stood at Kshs.209,146/= .   He cried out that  his dismissal was grossly unprocedural.   He stated that it  was unprocedural for the notice to be issued by the  Respondent’s lawyers and that he was totally denied  procedural fairness.  He alleged that he had not been  issued with a warning prior to the dismissal.

12. The Claimant produced 13 documents as exhibits attached  to and filed with his original statement of claim.

13. In cross examination the Claimant admitted that he had no  letter of appointment or contract for 1995.  He further  admitted that he was not earning a salary for the first 10  years of working with the Respondent.  He alleged that he  used to send fee notes for accountancy services rendered to  the Respondent during the first 10 years of his relationship  with the Respondent.

14. The Claimant admitted that the first and only contract of  employment between him and the Respondent was that  dated 16^th January, 2006.  He alleged that he was not paid  dues upon dismissal.

15. It is on the basis of the foregoing that the Claimant  pleaded with the court to be granted the alternative prayers  in the amended statement of claim as set out at the onset of  this judgment.

III. RESPONDENT’S CASE

16. In a nutshell, the Respondent’s case, as expressed and  captured in amended reply to the claim, oral and  documentary evidence as produced through CATHERINE  MWAURA (RW1), and the written submissions by its  Counsel, is that the Claimant was originally engaged as an  accountant in 2005.

17. RW1, the general manager of the Respondent, testified  that  from 2005 to 2013 the Claimant was on a monthly  salary of Kshs.55,000/= which was enhanced to  Kshs.208,000/=  for the period from 2013 to 2018.

18. Further, RW1 testified that for the period from 1995 to  2004 the Claimant was a financial or accounting  consultant for the Respondent and that the Claimant  became a fulltime employee of the Respondent in January  2005.  She testified that the Claimant ceased to be a  consultant in November, 2004 and took up the job of a  full-time accountant of the Respondent in January, 2005.

19. RW1 testified that in 2015 the Claimant abruptly and  without notice stopped reporting to work on allegation that  his life was in danger and it is then that the Respondent  decided to hire another accountant.

20. RW1 stated that the Claimant stayed away for long and on  20^th July, 2018 the Respondent decided to terminate the  Claimant through a notice issued by the Respondent’s  lawyer. The notice of termination was produced as  Respondent’s exhibit 5.  RW1 testified that the Claimant  had been issued with several warnings and that for the  period between 2015 and 2018 the Claimant was paid a  salary without working.  RW1 testified that the Claimant  worked for the Respondent for a period of 13 years.

21. RW1 testified that no gratuity was payable to the Claimant  and no leave pay was due as the Claimant took so many  days out of work yet he was paid full monthly salary for  almost three(3) years without reporting to work.

22. In cross-examination RW1 admitted that the Claimant was  not issued with a show cause letter and that there were no  records of disciplinary hearing before the dismissal.  She  also admitted that there were no records of any terminal  dues paid to the Claimant although she alleged that the  Claimant was paid a sum of Kshs.318,000/= and a further  Kshs.200,000/= was applied in purchasing a car for the  Claimant.  But she admitted that there was no evidence of  such payments filed in court.

23. RW1 testified that the Respondent keeps employees’ work  attendance register but admitted that the same had not  been availed in court to illustrate the attendance of the  Claimant.

24. Further, RW1 testified that the Claimant refused to sign  letters of appointment in 2005 and 2013 and that in  particular he destroyed the one of 2005.

25. It is on the basis of the foregoing that the Respondent  prayed that the Claimant’s entire cause be dismissed with  costs.

IV.   ISSUES FOR DETERMINATION

26. This court has carefully and dutifully gone through the  pleadings filed by both parties, the oral and documentary  evidence tendered, and the written submissions filed by  learned Counsel. In my view the following issues  commend themselves for determination:-

 (i) Was the summary dismissal of the Claimant by the   Respondent unfair/wrongful and therefore unlawful?

 (ii) If (i) above is in the affirmative, is the claimant entitled to the remedies sought for?

 (iii) Costs.

V.  DISMISSAL

27. It is common ground that the Claimant was terminated by  the Respondent vide a notice dated 20^th July, 2018 issued  through Ikua, Mwangi & Company Advocates for the  Respondent.  The notice was to take effect from 1^st  August, 2018.

28. Acknowledging that the notice was shorter than the 28  days stipulated under Section 35 (1) (c) of the  Employment Act (the Act), the Respondent undertook  to  pay to the Claimant one month’s salary in lieu of notice  and July salary.

29. The notice indicated that the Claimant was summarily  dismissed due to prolonged absenteeism in the entire  period of 2017 and 2018 without approval from the  Respondent, and yet he was receiving his monthly salary  as though he was working.  The said notice was copied to  the County Labour office, Nakuru.

30. It is not denied that the Claimant was served with the  notice.  However, the Claimant has taken issue with the  fact that the notice was issued by the Respondent’s lawyers  rather than the Respondent itself.

31. Advocates are recognized agents in law and when duly  instructed they are allowed to carry all lawful instructions  from a client to full effect.  No legal reasons have been  advanced as to why a duly instructed lawyer cannot issue  such a notice for and on behalf of the client, the  Respondent herein.

32. In the circumstances, the fact that the notice was issued by  the lawyers and not the Respondent does not of itself  invalidate the notice.

33. There is a plethora of decided cases on the importance of  both substantive and procedural fairness in termination of  employment by whatever method, may it be summary  dismissal, redundancy, or other.  Such decisions include  Mary Chemweno -Vs- Kenya Pipeline Company  Limited (2017) eKLR, and Loice Otieno -Vs- Kenya  Commercial Bank Limited (2013) eKLR, and Walter  Ogal Anuro -Vs- Teachers Service Commission (2012)  eKLR.

VI. SUBSTANTIVE FAIRNESS

34. Section 43 of the Act provides as follows:-

“(1) In any claim arising out of termination of a  contract, the employee shall be required to  prove the reason or reasons for the  termination, and where the employer fails to  do so, the termination shall be deemed to  have  been unfair within the meaning of  Section 45.

(2) The reason or reasons for termination of a  contract are the matters that the employer at  the  time of termination of the contract  believed to exist, and which caused the  employer to terminate the services of the  employee.”

35. Section 44(4)(a) provides that an employer may  summarily dismiss an employee who without leave or  other lawful cause absents himself from the place  appointed for the performance of his work.  Apparently,  this is the ground upon which the Respondent summarily  dismissed the Claimant as per the notice dated 20^th July,  2018.

36. It was therefore incumbent upon the Respondent to prove  that the Claimant was absent from duty without leave or  permission.  RW1 admitted in her testimony that there  were no records on the work attendance of the Claimant.   No records were produced to prove that the Claimant was  absent from duty for the period from 2017 to July 2018 or  any other time or at all.

37. It is the Respondent, the employer, who has custody of all  employment records under Section 10 of the Act and as  such  it is the Respondent who has the burden under  Section 43 of the Act to prove that the Claimant was  indeed absent from duty as alleged.

38. This court is of the opinion that the Respondent has failed  to illustrate, demonstrate, and prove that the Claimant was  indeed absent from duty as alleged and hence holds that  there was no reason(s) for the Respondent to dismiss the  Claimant as per the notice dated 20^th July, 2018.

VII.  PROCEDURAL FAIRNESS

39. Procedural fairness is more or less fair hearing as  envisaged  under Article 47 of the Constitution, Section  4 of the Fair Administrative Actions Acts, and the Rules  of Natural Justice. Naturally, no one should be  condemned unheard.

40. Section 41 of the Act provides a brief structure of what  procedural fairness entails.  In this cause, the Claimant was  not served with a show cause letter informing him of the  charges or allegations against him.  He was not invited for  a hearing to present his side of the story, so to say.  He was  not allowed or informed of his right of appeal on  dismissal and the procedure thereof.

41. RW1 in her evidence admitted that no hearing was held and that there were no minutes for such a meeting.  Clearly  the Claimant was denied procedural fairness and this court  is in agreement with the submissions from learned Counsel  for the Claimant on this issue, including the holding in  Kenya Union of Commercial & Allied Workers –vs-  Meru North Farmers Sacco Limited (2014) eKLR,  Rebecca Ann Maina and Others Vs. Jomo Kenyatta  University of Agriculture and Technology (2014) eKLR,  and Jared Aimba Vs.  Fina Bank Ltd. (2016)  eKLR.

42. Flowing from the foregoing paragraphs this court finds  and holds that the summary dismissal of the Claimant by  the Respondent was unfair, wrongful, and unlawful for  lack of both substantive and procedural fairness.

VIII. REMEDIES

43. At the commencement of the hearing on 1^st November,  2021 Counsel for the Claimant informed the court that the  Claimant was abandoning the main prayers in the amended  memorandum of claim dated 5^th October, 2018 in favour of  the alternative prayers.  The said alternative prayers have  been set out at the introductory part of this judgment and  this court shall now consider each of the prayers on merit  starting at prayer D which is the first of the alternative  prayers.

44. Prayer (D) is for “Kshs.6,920,175/= in wages and  benefits due as currently paid by the Respondent.” This  court has tried to deceifer what this prayer is about and  consulted the Claimant’s Counsel written submissions at  paragraph 29 page 8 where counsel submits that “we  therefore urge the court to allow the Claimant’s claim for  unpaid wages and dues at Kshs.6,920,175/= and underpaid  salary at Kshs.23,832,000/=.”

45. The amended statement of claim does not provide for  particulars  on how the figure of Kshs.6,920,175/= has  been arrived at. In his testimony, the Claimant did not  tender any evidence in support of this claim and no  documentary evidence was  produced in support of the  same.

46. In paragraph 23 of his written submissions, page 6  thereof, Counsel for the Claimant submitted that “the  Claimant pleaded that he had unpaid leave allowance,  wages and benefits amounting to Kshs.6,920,175/=.”    Again no particulars are provided or tabulated on how that  figure is arrived at.  This begs for the following questions;

 What is the period of the unpaid leave?  What wages were  not paid?  What benefits were due and not paid for?   These questions find no answer from the Claimant and  remain begging.

47. Inasmuch as it is the duty and obligation of the employer,  the Respondent in this case, to keep good employment  records under Section 10 of the Act, it is also an  obligation  and duty of an employee who files a claim in  court to plead with sepecifity and provide particulars to  enable the court to determine the issues in controversy.

48. Pleadings from either party need to be concise and precise.   Where a consolidated and liquidated amount of money is  claimed the specifics and particulars thereof should be  provided to enable the other party to respond with equal  precision.   Where the particulars are not provided for as is  the case in this cause, the Respondent (employer) cannot  be blamed for not availing documents or records of  employment for unspecified period spanning over 23  years.

49. In the circumstances, and in view of the foregoing this  court holds that the Claimant has failed to prove that the  claimed sum of Kshs.6,920,175/= is due and payable to  him by the Respondent.

50. Prayer D (i) is for underpaid salary for 23 years amounting  to Kshs.23,832,000/=.  Again, no particulars are provided  by the Claimant on how this figure is arrived at.   As stated  above, it is not enough for a party to plead or make a claim  without substantiating and supporting the same by way of  particulars, oral and or documentary evidence, and yet  expect the court to grant the same.

51. The evidence on record, and which the court finds to be  reliable, is that the Claimant was at first (between 1993  and  2004) engaged as a financial consultant by the  Respondent.  This explains why the Claimant served the  Respondent with fee notes and invoices for services  rendered.   Basically, there is no way that the Claimant  could have been an employee of the Respondent earning  a salary and at the same time earning consultancy fees for  the same accounting financial services.

52. The evidence on record that the court finds credible is that  the Claimant was a consultant from 1993(or 1995) to 2004  and took up full employment with the Respondent from 1^st  January, 2005.  The Claimant was unable to substantiate,  provide evidence, and or confirm the terms of his alleged  employment prior to January 2005.  On the other hand  RW1 was unshakable in her evidence that the Claimant  entered full employment with the Respondent as from  January, 2005.

53. The Claim for Kshs.23,832,000/= in alleged underpaid  salary for 23 years by the Claimant is hence misplaced and  not proven and the same must fail.

54. Prayer E is for damages for unfair/wrongful dismissal  from employment.  This court has already found that the  summary dismissal of the Claimant by the Respondent was  unfair, wrongful, and unlawful for lack of substantive and  procedural fairness.  It follows therefore that the Claimant  is entitled to compensation.  The damage that an employee  suffers as a result of unlawful dismissal or termination is in  the salary and benefits that such an employee could have  earned were it not for the dismissal or termination.

55. Section 49(c) of the Act caps the maximum compensation  awardable  at 12 months gross monthly wage or salary of  the employee as at the time of dismissal. While the  Claimant’s Counsel submits that his last gross salary was  Kshs.208,246/= and the Respondent’s counsel agrees with  the same  in their respective submissions, the court notes  that the last pay-slip produced by the Claimant as exhibit  from his bundle of documents is for the month of April,  2018 which indicates the gross pay at Kshs.209,146/=.   This court shall use this figure of Kshs.209,146/= as the  Claimant’s last gross pay for all intends and purposes as   the same is supported and authenticated by the payslip  alluded to above.

56. The Claimant is not interested in being re-engaged or  reinstated into the employment of the Respondent.  There  is no tangible evidence on what role, if any, the Claimant  played in his dismissal as the allegations of absenteeism  were not proved.  It is obvious that the relationship  between the Claimant and the Respondent was bad and  bitter at the time of dismissal.  The Claimant was in  employment of the Respondent for the period from 2005 to  2018, a period of about 13 years, which is a considerably  long time.

57. The Claimant did not inform the court if he has found  another job, and if he did how long it took him to do so.

58. This court has critically looked at the factors that it ought  to consider when making an award under Section 49 of  the Act.  Considering all the relevant factors and the  entire circumstances of this cause, this court is of the view  that an award of the maximum 12 months gross salary  would be fair compensation in this matter.

59. In awarding the maximum 12 months gross salary this  court is mindful of the fact that the Claimant served the  Respondent for a considerably lengthy period of time of  about 13 years and that he was denied both substantive and  procedural fairness prior to dismissal.  The award is hence  calculated as Kshs.209,146/= X 12 = Kshs.2,509,752/=.  This amount is subject to statutory deductions.

IX. COSTS

60. Costs follow event and the Claimant is awarded costs  based on the award.

X. DISPOSAL

 61. This court makes the following orders in disposal of this  matter:-

(a) A declaration be and is hereby issued that the  dismissal of the Claimant by the Respondent  was unfair, wrongful, and unlawful for lack of  both substantive and procedural fairness.

(b) The Claimant is awarded a sum of  Kshs.2,509,752/= being compensation for the  wrongful and unlawful dismissal.

(c) The award in (b) shall earn interest at court  rates from the date of this judgment till  payment in full.

(d) Costs to the Claimant.

DATED, SIGNED, AND DELIVERED VIRTUALLY AT NAKURU THIS 26^TH DAY OF APRIL 2022.

.................................

DAVID NDERITU

JUDGE