Background
1. By a Statement of Claim dated 21st October 2022, the Claimant sued the Respondent seeking the following reliefs;
a. A declaration that the sending of the Claimant on unpaid leave [suspension without pay] through the letter dated 2nd June, 2016, was unfair, punitive, baseless and amounted to unfair labour practice and contravention of Article 41 of the Constitution and the Employment Act;
b. A declaration that the Claimant’s rights under Articles 41, 47, and 50 of the Constitution of Kenya were violated by actions of the Respondent, by delaying and failing to conclude the disciplinary process within a reasonable time.
c. A declaration that the Claimant was constructively dismissed from employment by the conduct of the Respondent, who failed to comply with the order of the Court.
d. A declaration that the Claimant is entitled to exemplary damages for suppression of career growth by the Respondent.
e. Compensation for unfair termination, 12 months’ salary totalling to KShs. 1,500,000 subject to statutory deductions.
f. Payment of all unpaid salary from May 2016 to June 2022, being 74 months, totalling 9,250,000.
g. One month’s salary in lieu of notice, KShs. 125,000.
h. Payment for the untaken annual leave days allowance being 26 days per year for 74 months, totalling KShs. 668,055.56.
i. Issuance of a certificate of service to the Claimant for the services rendered from August 2014 to May 2022 in compliance with Section 51 of the Employment Act.
j. The Respondent bears the costs of the suit.
k. Interest on [d][e][f] and [g] above, at court rates from the date of filing this suit,
2. The Respondent resisted the Claimant’s claim through a Response to the Statement of Claim, denying the Claimant’s claim, asserting that the claim is res judicata and without a cause of action. Further, the reliefs sought are not entitled to.
3. At the hearing, the parties adopted their witness statements filed herein as part of their evidence in chief and presented, as their documentary evidence, the documents they filed under their respective lists of documents.
The Claimant’s case
4. The Claimant stated that she was an employee of the Respondent as a Management Accountant with effect from 1st August 2014 up to 1st May 2022, when she was constructively dismissed from employment.
5. Following the constructive dismissal, she filed suit against the Respondent, Mombasa ELRC, Cause No. 155 of 2017. In its judgment delivered on 22nd October 2021, the Court concluded that she had not been dismissed and remained an employee of the Respondent. In light of disciplinary proceedings pending against her, the Court directed that they be concluded within 6 months, by 1st May 2022.
6. She stated that the Court further directed that, in default, she could be deemed exculpated, and in any event, the parties were at liberty to pursue their respective rights and obligations through appropriate legal processes if need arose.
7. The Respondent partially complied with the Judgment by paying her KShs. 175,000 as notice pay and an additional KShs. 50,000 that had been awarded in the Judgment. However, it failed to comply with the Judgment by concluding the disciplinary proceedings within the time stipulated. As no action was taken against her as directed by the Court, she was deemed exculpated from the disciplinary charges.
8. By failing to conclude the disciplinary process as directed by the Court, the Respondent committed a repudiatory breach, thus constructively dismissing her.
9. Prior to the initial suit, the Respondent suspended the Claimant for 72 months without pay, thereby committing an unfair labour practice. Throughout the period, the Respondent exhibited an unwillingness to conclude the disciplinary proceedings.
10. While she was under suspension, she had a legitimate expectation that at the end of the disciplinary process she could be paid all her dues and more particularly upon being exculpated.
11. She further stated that at no time did she unequivocally accept that her suspension period would be treated as unpaid leave. She did not waive her right to challenge the unpaid leave, nor did she conduct herself in such a manner as to evince an intention to waive it. In the initial suit, she challenged the suspension's legality and sought compensation.
12. Through an email dated 30th May 2022 from the Respondent’s Administrative Manager, Sarah Mutua, the claimant was asked to make arrangements to attend the offices to finalise her outstanding disciplinary matter.
13. In a letter dated 3rd June 2022, she responded to the email and noted that, by virtue of the Judgment, she was exculpated and intended to commence legal proceedings to enforce her rights. She invited the Respondent to discuss the issue of her rights being kept without employment as a result of the constructive dismissal.
14. On 8th June 2022, the Respondent’s General Manager, Crispus Mwamidi, regretted the delay in concluding the disciplinary process and stated that the Respondent was therefore compelled to withdraw the proceedings against her. The manager noted that she remained an employee of the Respondent and invited her to report to work within 7 days. The abandonment of the process served no purpose, as the court order had already taken effect.
15. On 9th June 2022, her Counsel wrote to the Respondent, drawing the Respondent’s attention to the hostile working environment she had endured and to the Respondent's unwillingness to conclude the disciplinary process, which had caused her immense prejudice. Further, the suspension without pay lacked any valid reason and was equally unnecessary and prejudiced her. The letter demanded damages for constructive dismissal.
16. The letter prompted a response from the Respondent’s Counsel, dated 13th June 2022. The letter opined that the Claimant had no reasonable claim against the Respondent.
17. On 23rd June 2022, the Respondent wrote a letter titled “Notice to show cause” to the Claimant. She was asked to show cause why disciplinary action could not be taken against her for failing to report to work. The letter stated that if no response was received within three days, disciplinary action would be taken against her.
18. By a letter dated 24th June 2022, the Claimant issued a resignation letter. In the letter, she cited the Respondent’s unfair labour practices and conduct, which constrained her to resign from employment.
19. On 27th June 2022, by letter, the Respondent accepted the resignation. However, it demanded notice pay, alleging that it had not been issued a termination notice. As such, she was supposed to pay the sum of KShs. 125,000. The Respondent acknowledged owing her KShs. 133, 333 being the salary for May and June 2016.
20. In the stated letter, it was further stated that following the Court's judgment, they had paid her salary for April 2016, without subjecting it to taxation. They deducted KShs. 31,372.
21. Upon employment on 1st August 2014, she was placed under probation for three months with a salary of KShs. 85,000. After the successful conclusion of the probation, her salary was increased to KShs. 125,000 with effect from 1st December 2014.
22. In 2016, internal wrangling within the Respondent enterprise affected the discharge of his duties. Ms Mary Stevens, then serving as a director, refused to approve and sign the expenditure cheques, leaving the General Manager, Mr Gichohi, with no option but to authorise the Claimant to use daily collections.
23. The situation changed rapidly. The General Manager, Mr Charles Gichohi, was replaced by Ms Mary Stevens in March 2016. Following the change in management, all employees perceived as loyal to and close to the outgoing General Manager were victimised and removed.
24. On 12th May 2016, she received a show cause letter from Ms Mary Stevens, which suspended her from work for 14 days and required her to respond to a number of allegations. She responded.
25. On 2nd June 2016, the Respondent issued her a letter sending her on unpaid leave until the matter was concluded. In the letter, it was noted that the Management Board could not provide a full response until the 2015 audit is completed and a report is presented to the Board. There was no justification for sending her on unpaid leave. The action amounted to an unfair labour practice. `
26. The Claimant asserted that she was subjected to six years of uncertainty and anxiety caused by the Respondent. It is necessary to expeditiously conclude disciplinary proceedings to allow both parties to progress. Her career was hindered and suppressed, warranting her entitlement to exemplary damages.
The Respondent’s case
27. The Respondent called one witness, Mr Alexander Baraka Furaha, to testify on their behalf.
28. The witness stated that the Claimant was employed under a letter of appointment dated 18th August 2014. The effective date of the employment was expressed as 1st August 2014.
29. He further stated that the Claimant resigned from her employment through her letter dated 24th June 2022.
30. The witness further stated that the instant suit is res judicata, the initial suit, Mombasa ELRC Cause No. 155 of 2017. In this matter, a judgment was given on merit. The Respondent complied with the judgment and paid the claimant a sum of KShs. 175, 000.
31. The Respondent formally withdrew the disciplinary proceedings that were pending against the Claimant through a letter dated 8th June 2022. Following the withdrawal, the Claimant was invited to return to work, but she declined. Having refused to do so, the Respondent had no option but to issue her a show-cause letter.
32. Instead, the Claimant issued the Respondent with a resignation letter dated 24th June 2022. She neglected to issue the Respondent with one month’s termination notice.
Analysis and Determination
33. I have carefully considered the pleadings, evidence and submissions of the parties, and the following issues emerge for determination;
I. Whether the instant suit is res judicata, Mombasa ELRC No. 155 of 2017- Diana Gaceri Kigunda vs Kenga Equatorial Hotels t/a Mombasa Continental Resort.
II. Whether the Claimant was constructively dismissed from employment.
III. Whether the Claimant is entitled to the reliefs sought.
34. The Respondent asserted and extensively submitted that the doctrine of res judicata militates against the Claimant’s present suit. The current claim raises issues that were determined in the initial suit referred to above. The Claimant held otherwise, stating that the matters raised in the current suit were not conclusively determined in the initial suit, and therefore, the doctrine of res judicata does not apply.
35. The doctrine of res judicata, a legal principle designed to ensure finality in litigation, prevent the abuse of the court process through repetitive suits, protect parties from being vexed twice over the same dispute, and preserve judicial time and resources, as well as public confidence in the administration of justice, prohibits a court from rehearing a dispute that has already been conclusively decided by a competent court between the same parties, concerning the same subject matter and issues. Once a matter has undergone final adjudication, it is impermissible to reopen it through a new suit or subsequent proceedings. See also Fatuma Chemkono & 40 others v District Commissioner Msambweni & Another [2013] KLR, cited by Counsel for the Respondent.
36. There is no dispute that an initial suit was filed between the same parties, in which the Court issued a judgment. However, I am not convinced that the Court conclusively resolved all the issues in dispute in that lawsuit. In fact, it explicitly reserved some crucial issues pending and allowed the parties to pursue them at a future time through appropriate legal processes, any of them or both deemed necessary.
37. The Court in the initial suit held inter alia;
“ The Court therefore considers that the question whether the Claimant will be paid since suspension will be determined after conclusion of the pending disciplinary case. The Claimant testified thus, “Currently, I casually work for a school. I started in 2020”. The Court considers that such engagement of the Claimant and other pertinent matters, including that the Claimant was emplaced on unpaid leave [thereby lifting the suspension], are matters to be considered at the end of the disciplinary process. This Court will not therefore delve into the effect on the parties’ rights, obligations and claims so as to pave the way for the conclusion of the disciplinary process and parties to resolve the issues per the contract of service in one way or the other.”
38. The Court went ahead to further state;
“If the disciplinary process is not expeditiously concluded and the Claimant is deemed exculpated [in the finding of the Court in this Judgment and fixed at 01.05.2022], the Court considers that the parties would be at liberty to pursue their respective rights and obligations by way of appropriate legal process as may become necessary.
39. In light of the foregoing, it is not difficult to conclude that the doctrine of res judicata does not apply. Before I consider the next issue, it is imperative to state that, in my view, the claim for constructive dismissal in the instant matter is based on different circumstances and facts from those in the initial suit.
40. Although it has no common law antecedent, the doctrine of constructive dismissal corresponds to the concept of repudiation of the contract of employment by the employer and the employee's acceptance of that repudiation, thereby bringing the contract to an end. Jurisprudence of Courts has defined constrictive dismissal as actions on the part of the employer that drive the employee to leave, whether or not there is a form of resignation; such actions can take a wide variety of forms. The circumstances of constructive dismissal are infinitely various that there can be, and is, no rule of law saying what circumstances justify and what do not. It is a question of fact for the Court. See also the Court of Appeal decision in Coca-Cola East &Central Africa v Maria Kagai Ligaga [2015] eKLR.
41. There must be unfair or wrongful conduct by the employer that drives the employee to resign.
42. In Leena Apparels [EPZ] Ltd v Nyevu Juma Ndokolali [2018] eKLR, the Court of Appeal stated;
“……….. Whenever an employee alleges constructive dismissal, a court must evaluate if the conduct of the employer was such as to constitute a repudiatory breach of the contract of employment. The employer’s conduct does not have to be intentional or in bad faith before it can be repudiatory………”
43. It is undisputed that the Court in the initial case directed that the disciplinary proceedings be conducted within a specified timeframe. Casually, the Respondent failed to adhere to the Court’s directive and instead purported to invite the Claimant to the office to finalise the disciplinary process. In my opinion, it is reasonable for an employee to have a legitimate expectation that, once a court order or judgment directs regarding matters in the employment relationship between the employer and the employee, the employer is obliged to comply. The implied duty of trust and confidence is a fundamental obligation incumbent upon the employer within an employment contract. Breach of the duty, in my view, goes to the root of the contract. It is repudiatory.
44. By flagrantly failing to abide by the Judgement order, the Respondent evinced an intention not to be bound by the terms of the contract of employment. It matters not that it later purported to undo the breach by withdrawing the disciplinary process, an action I hold, in the circumstances of the matter, was an afterthought.
45. This Court has not overlooked the fact that the judgment made it clear that the Claimant’s agitation for payment of her unpaid salary for the period during the suspension and the period thereafter, under unpaid leave, needed to be addressed. As will be seen hereinafter, there is no law that permits suspension without pay or unpaid leave. Knowing that the judgment had taken effect and that, as such, the Claimant was exculpated of the disciplinary charges, despite the correspondence by the Claimant, the Respondent purported to order her back to work without addressing the raised issue, thus evincing an intention not to settle the matter regarding the alleged unpaid salary, which I find was validly raised. The failure constituted a breach of a fundamental term of the contract, payment of an employee’s remuneration.
46. Without settling the matters raised by the Claimant or allowing any opportunity for deliberation on them, the Respondent purported to issue the Claimant a show cause letter, asking her to show cause why disciplinary action would not be taken against her for failing to report to work. In my view, this disciplinary process was initiated in bad faith and, in addition to the Respondent’s other actions mentioned hereinabove, would fuel the Claimant’s exit, justifiably.
47. In Leah Apparels Limited [supra], the Court of Appeal further stated
“It would seem to us that, as at 4th January 2016, the Respondent was well within her rights to treat the contract as having been repudiated by her employer. Consequently, the letter of 8th February 2016, which was written by the Appellant, asking why the Respondent failed to return to duty on 1st February 2016, is, in our view, a belated attempt to unringing the bell. Though the Appellant purported to write letters to the Respondent claiming desertion of duty on 1st February 2016, the letter was written a whole week later …and thus a mere attempt by the Appellant to regularise an already repudiated contract. As a result, I find the learned Judge’s finding that constructive dismissal had arisen cannot be faulted.”
48. A careful consideration of the Claimant’s resignation letter reveals that the Claimant’s resignation was not prompted by a desire to avoid a disciplinary hearing. It was the result of the Respondent’s various actions, which amounted to a repudiatory breach of the fundamental terms of the contract of employment.
49. It is important to note that not every resignation that arises during the disciplinary process should be viewed as an attempt to avoid the process and its consequences. Each case should be considered in its own circumstances.
50. By reason of the foregoing premises, I come to the inescapable conclusion that the Claimant has proved that she was constructively dismissed.
51. I now turn to consider whether the Claimant is entitled to the reliefs sought. Constructive dismissal is an unfair dismissal. Having found that the Claimant was constructively dismissed, I now turn to consider whether she is entitled to any relief on account of the dismissal. Section 49[1][c] of the Employment Act bestows on the Court the authority to grant a compensatory award for unfair dismissal. The award and the extent thereof depend on the circumstances of each case. The exercise of the authority is discretionary.
52. I have considered the length of service the Claimant rendered to the Respondent, the Respondent’s actions that prompted the Claimant to leave, some of which would constitute unfair labour practices, and the fact that the Claimant did not contribute in any proven manner to the separation, and conclude that the Claimant is entitled to relief in the amount of six months’ gross salary.
53. It is not in dispute that the Claimant was sent on unpaid leave until the matters in controversy were resolved. Further, up to the date of resignation, she had so remained excluded from work. It is trite that during the suspension of an employee, the employment is neither terminated nor the employee dismissed. It is merely put on hold to enable the employer to properly carry out its investigations into its allegations against the employee. During the employee’s indefinite suspension without pay, he remains in the employer's employment, so he is entitled to his salary and allowances. The contemplation of the law is that suspension would not extinguish the employee’s status as an employee, nor would it jettison the employment contract.
54. In the case of Chief Justice and President of the Supreme Court of Kenya & and Judicial Service Commission vs Bryan Mandila Khaemba Civil Application No. 299 of 2019, the Supreme Court of Kenya Stated;
“The Court further follows the holding by Rika J in Peterson Ndungu & 5 Others –Versus-Kenya Power and Lighting that the withholding of an employee’s pay during the period of suspension has no basis and validity under the Employment Act, 2007. That principle applies as the minimum term and condition of service under the Employment Act, 2007. Needless to state, it is a principle within the purview of Article 41 of the Constitution on fair labour practices. Further, the Court considers that the minimum terms and conditions of service under the Employment Act, 2007, constitute rights incorporated in the Bill of Rights, when the Constitution provides in Article 19 (3) (b) that the rights and fundamental freedoms in the Bill of Rights do not exclude other rights and fundamental freedoms not in the Bill of Rights, but recognised or conferred by law, except to the extent that they are inconsistent with the Chapter 4 of Constitution on the Bill of Rights.
Thus, the Court returns that it is unconstitutional for an employer, by policy or regulation, to impose a suspension with nil pay as an administrative or executive interlocutory disciplinary measure pending the finalisation of the disciplinary process. The Court considers that it amounts to unfair labour practices in contravention of Article 41 of the Constitution for an employer to impose suspension, more so an indefinite suspension, with nil pay. Thus, the Court has held before that where an employer withholds salary during interdiction, then the employee would be entitled to recover at the end of the disciplinary process, and there cannot be a notion of suspension with nil pay. The court follows the holding in Grace Gacheru Muriithi versus- Kenya Literature Bureau (2012) eKLR, in which the court stated thus, “The court considers that an employee on interdiction or suspension has a legitimate expectation that at the end of the disciplinary process he or she will be paid by the employer all the dues if the employee is exculpated. Conversely, if the employee is proven to have engaged in the misconduct as alleged and at the end of the disciplinary process the employee has not exculpated himself or herself, the court considers that the employee would not be entitled to carry a legitimate expectation to be paid for the period of suspension or interdiction. Thus, the court holds that whether an employee will be paid during the period of interdiction or suspension will depend upon the outcome of the disciplinary proceedings. It would be an unfair labour practice to deny an employee payment during the period of interdiction or suspension if, at the end of the disciplinary process, the employee is found innocent. Similarly, it would be an unfair labour practice for the employer to be required to pay an employee during the suspension or interdiction period if, at the end of the disciplinary
process, the employee is found culpable. Accordingly, the court finds paragraph 6.2.4 of the respondent’s Terms and Conditions of Service to be an unfair labour practice to the extent that the provisions deny the employees payment even in instances where they exculpate themselves at the end of the disciplinary process.
55. In light of the foregoing premises, I have no hesitation in concluding that the Claimant is entitled to her salary for the entire period of suspension/leave without pay.
56. In the upshot, Judgment is hereby entered for the Claimant in the following terms;
a) A declaration that the Claimant was constructively dismissed.
b) Compensation for unfair termination pursuant to the provisions of Section 49[1][c] of the Employment Act, six months’ gross salary, KShs. 750,000.
c) Unpaid salary for the period May 2016 to June 2022, KShs. 9,125,000.
d) Interest on [b]above from the date of this Judgment till full payment.
e) Interest on[c] above at court rates from the date of filing this suit till full payment.
f) Costs of this suit.
g) The Respondent to issue the Claimant with a certificate of service within 30 days of today.
Read Signed and Delivered this 30th Day of April 2026.