The appeal herein arises from the judgment delivered on 11 April 2024 in Mombasa MCELRC No.250 of 2021. The appellant is seeking that the judgment be set aside and the same substituted with an order dismissing the claim with costs.
The background of the appeal is a claim filed by the respondent on the basis that he was employed by the appellant as a waitress from November 2018 until 4 March 2020 earning a wage of Ksh.20, 250 per month. The respondent’s case is that she reported on duty on 4 March 2020 but her employment was verbally terminated by the appellant and sent off the premises. There was no warning, hearing or notice issued before termination of employment. She claimed underpayment, there was no rest day allowed, worked overtime without pay, no house allowance was paid and the termination of employment was not justified. The respondent claimed the following terminal dues;
- 12 months compensation Ksh.243,000;
- Notice pay Ksh.20,250;
- Service pay Ksh.10,125;
- Unpaid leave Ksh.14,175;
- Public holidays Ksh.40,500;
- Overtime Ksh.347,287.50;
- House allowance Ksh.42,525;
- Certificate of service;
- Costs of the suit.
In response, the appellant’s case was that the respondent was employed from November 2018 as a waitress on and off on a casual basis. She discharged her duties without due diligence and dealt with the appellant’s commercial items namely champagne with ulterior motives to the loss of the appellant. On 25 February 2020, the respondent was assigned duties at the bar. She was suspected of transferring champagne wines from the original branded bottle to her private plastic bottle which she placed in the bin. Upon detection, the appellant recorded a statement from the respondent and on 27 February 2020 a meeting was held with the work committee and human resources over this conduct. A summons was issued to attend a disciplinary hearing on 2 March 2020 but she failed to give satisfactory explanations for the misconduct. This justified termination of employment for good cause and upon due process.
In the judgment of the trial court, there is a finding that employment was terminated unfairly and the following awards were made;
- 3 months compensation Ksh.60,750;
- Notice pay Ksh.20,250;
- Unpaid leave Ksh.14,175;
- Overtime pay Ksh.347,287;
- Costs and interests.
Aggrieved by the judgment, the appellant filed this appeal on 15 grounds that the learned magistrate erred in law and fact in finding that there was an unfair termination of employment on account of inadequate time to prepare for the disciplinary hearing while the respondent had pleaded that she was not invited to any hearing. The finding that the notice period for hearing was too short had no factual or legal basis. The finding that the disciplinary process was unfair was in error.
Other grounds of appeal are that the trial court failed to address the question of whether the respondent was a casual employee or not or on term employment. The evidence by the appellant that the respondent was a causal employee was ignored and hence awarded notice pay for a term employee which was in error. Service pay was not due since the respondent is registered with NSSF. The award of overtime was in error since the respondent could not remember when she had worked overtime and was then awarded annual leave due for a full year and excessive compensation to a casual employee. The order to issue a Certificate of Service was not justified since the respondent admitted that this had been issued and produced in court.
Both parties attended and agreed to file written submissions.
The appellant submitted that the respondent in the Memorandum of Claim claimed that on 4 March 2020, there was verbal termination of employment and no notice was issued but in court, the evidence was that she was issued with 7 days’ notice. Due to her conduct, the appellant invited the respondent to address before termination of employment. Through a letter dated 27 February 2020, the appellant invited the respondent to a disciplinary hearing to be held on 2 March 2020 and she submitted her response evidenced in exhibit 6 of the claim. The appellant directed the respondent to report to the human resources office through a notice dated 2 March 2020 to hear the decision concerning termination of employment following the disciplinary hearing.
The trial court failed to take into account the glaring discrepancies in the evidence submitted by the respondent. The process leading to the termination of employment was justified and the respondent was accorded due process leading to notice dated 2 March 2020. The time between the issued disciplinary letters on 27 February 2020 to 2 March 2020 was sufficient to allow the respondent to attend. In the case of G4S Security Services (K) Limited v Lagat [2022] eKLR the court held a notice period of two days had been too short but the employee did not seek more time indicating any hindrance from attending the disciplinary hearing. In the case of Patrick Abuya v Institute of Certified Public Accountants of Kenya (ICPAK) & another [2015] eKLR, the court held that the employee did not seek more time to be allowed to prepare for the disciplinary hearing and hence cannot justify a claim that there was unfair termination of employment.
The appellant submitted that the question of whether the respondent was a casual employee or not was not addressed by the trial court. This was material in the sense that Timothy Gikonyo the witness called by the appellant testified that the respondent was employed as a waitress on a casual basis. This evidence was not challenged and hence, on the daily wage paid, the notice pay awarded was in error, the annual leave allocated for a full year was not justified and ultimately, the award of compensation for 3 months was without merit.
The respondent admitted during cross-examination that she was employed as a casual employee and was paid a daily wage of Ksh.675 which was paid weekly on a prorated basis for days worked. She was employed from November 2018 up to February 2020. The acknowledgement by the respondent was not taken into account.
The awards made should be reviewed and dismissed with costs.
The respondent submitted that the awards by the trial court were justified and should be confirmed and the appeal dismissed with costs. In the case of Roadtainers Mombasa Limited v Choga Tsuma ELRCA E078 of 2024, the court held that the Employment Act places a heavy burden on the employer in matters of summary dismissal. The employer must prove the reasons for terminating employment and justify the grounds as required under Sections 41 and 43.
In this case, the appellant dismissed the respondent from employment without proper cause and failed to adhere to the due process. The respondent was not accorded a reasonable period to prepare for the disciplinary hearing. There were no concise charges with particulars to allow her to appreciate and prepare a response. The recorded statements were not provided leading to unfair termination of employment and compensation should be reviewed in 12 months. In the case of Kenya Ports Authority v Munyao & 4 others Petition E008 of 2023 the Supreme Court held that under Section 49 of the Employment Act, the court is allowed to award up to 12 months compensation for wrongful termination of employment.
The appellant admitted that there was no notice to the respondent before the termination of employment and hence notice pay is due. Service pay accrues where NSSF and NHIF are not paid. There was no proof of the respondent taking annual leave. There is no record of how overtime was compensated together with house allowance which should be re-assessed and awarded with costs.
Determination
This is a first appeal. The court is allowed to review the entire record and make its conclusions. However, the court must remember that the trial court had the opportunity to hear the witnesses.
Through notice dated 2 March 2020, the appellant dismissed the respondent from employment for gross misconduct. The reason is that she had stolen champagne. She was issued with notice dated 27 February 2020 to attend a disciplinary hearing on 2 March 2020. Timothy Gikonyo testified for the appellant and reiterated these facts.
The respondent’s case was that she was summoned on 2 March 2020 and verbally dismissed from her employment. On the records filed by the parties, this position is not correct. There was notice before the sanction of termination of employment. The respondent was invited to attend a disciplinary hearing within a short time which is not denied.
The sanction of summary dismissal is allowed under Section 44(4) of the Employment Act. Where the employee commits gross misconduct such as theft, such matter must be addressed instantly with summary dismissal. However, the employee’s rights must be secured under the provisions of Section 41(2) of the Employment Act. The employee must be allowed to attend with another employee of her choice and be allowed to make her representation within a short time.
The act of theft by an employee is defined under Section 44(4) (g) of the Employment Act as gross misconduct. All that section 44(4) (g) of the Act requires for an employer to terminate an employee is that he has reasonable and sufficient grounds to suspect that the employee has been involved in a criminal act which is injurious to the person or property of the employer.
The notice required to be issued to the employee under Section 44(1) of the Employment Act is that;
(1) Summary dismissal shall take place when an employer terminates the employment of an employee without notice or with less notice than that to which the employee is entitled by any statutory provision or contractual term.
The employer is allowed to dismiss the employee without notice but must demonstrate the circumstances that led to such a decision. A short notice is also allowed where the conduct of the employee demands the notice period be reduced.
The trial court assigned 7 days for notice before the disciplinary hearing without taking into account the circumstances leading to the notice dated 27 February 2020 and the disciplinary hearing on 2 March 2020.
In this case, the respondent had committed theft, a criminal act. To allow for continued employment was not justified.
In the case of Benjamin Maundu Syanda v Telkom Kenya Limited [2020] eKLR the court held that the summary dismissal was justified in a case where the employee was found insubordinate and neglect of duty. In the case of Mwene v Taj Super Foods (Employment and Labour Relations Appeal E027 of 2023) [2023] KEELRC the court held that the conduct of the employee before summary dismissal justified termination of employment without notice.
I therefore find that the appellant had valid reasons to terminate the employment of the respondent. There was sufficient evidence to point at conduct bordering on gross misconduct on the part of the respondent.
On the ground that the respondent was a casual employee and the trial court failed to address such matter and hence arrived at wrong findings, the appellant in the written submissions has made a case that the respondent admitted that she was a casual employee. An extract of the evidence is highlighted as follows;
In the handwritten letter dated 22/3/2020, the respondent states, ‘My name is Veronica Odero, I was employed by Sarova Whitesands as a waitress from November 2018 to February 2020 as a casual. …
On their part, the appellant admitted that the respondent would be paid a daily wage of Ksh.675 which was paid weekly on a prorate basis depending on the days worked.
A casual employee is defined under Section 2 of the Employment Act as one who is sourced each day and paid at the end of each day.
A casual employee who continues to work on the same job and for the same employer continuously and for work that is not likely to end is protected under the provisions of Section 37 of the Employment Act. Such an employee is secured with rights and benefits under the Act. In the case of Humphrey Nyaga Thomas & 25 others v Kenyatta University [2021] eKLR the court held that a casual employee is one whose employment ends at the end of each day with a payment without expecting further employment.
The Court of Appeal in the case of In the case of Rashid Mazuri Ramadhani & 10 others v Doshi & Company (Hardware) Limited & another [2018] eKLR, in addressing the case of casual employees held that;
Our reading of Section 37 of the Employment Act reveals that before the court can convert a contract of service thereunder, the claimant ought to establish first, that he/she has been engaged by the employer in question on a casual basis and second, he/she has worked for the said employer for a period aggregating to more than one month.
In this case, the employment of the respondent from November 2018 to 2 March 2020 with payment of wages weekly is not casual. The respondent’s employment was secured under the law with rights and benefits.
On the claims made, the finding that employment terminated following the law, the remedy of notice pay and compensation is awarded in error.
On the claim for service pay, on the evidence of statutory payments as submitted by the respondent including her NSSF payments, under Section 35(5) and (6) of the Employment Act, such payment is not justified.
For overtime payment claims, the respondent claimed that she worked for 7 days each week without a rest day. Under Section 27 of the Employment Act, the employee has a right to a rest day each week. Upon the protection of the respondent as an employee with rights and benefits under the law, the evidence that she was a casual employee converted and should have been allocated an off day with pay each week.
Further, the appellant has relied on evidence that the respondent could not recall the overtime hours worked. However, the duty to submit work records rests with the employer.
The appellant submitted the payment schedules for the respondent. The schedule for 20 February 2020 shows the respondent worked for 7 days in the week;
Schedule for 20 December 2019 the respondent worked for 8 days;
Week of 3 December 2019, the respondent worked for 7 days;
Week of 6 December 2019, the respondent worked for 7 days;
During the week of 22 August 2018, the respondent worked for 7 days;
During the week of 29 March 2019, the respondent worked for 2 days;
During the week of 1 March 2019, the respondent worked for 2 days;
The week of 11 January 2019 the respondent worked for 7 days.
Cumulatively, in the last year of service, that is March 2019 to March 2020, the respondent was at work for 7 days each week on a daily rate wage.
Under the Wage Orders, a daily rate only applies to an employee defined as a casual labourer. As defined above, the respondent ceased being on casual terms employment upon the continuous employment by the appellant and payment of wages weekly and not daily. She was secured under the provisions of Section 37 of the Employment Act with rights and benefits thereof.
Under the protections of Section 27(1) of the Employment Act, the respondent was entitled to a rest day each week with full pay. For the last 12 months of service, these are 52 rest days on a last wage of Ksh.675 total due is Ksh.35, 100.
On the claim for work during public holidays, each such day is gazetted by the Minister. The employee must outline the Public Holidays where she was at work a general claim cannot suffice.
The payment of a daily wage is not controverted at Ksh.675. This wage is commensurate to the daily wage due to a casual employee which takes into account the house allowance component. The total paid at Ksh.20, 250 per month is over and above minimum wage and to claim for house allowance is unjust enrichment.
Similarly, a protected employee has a right to take annual leave under the provisions of Section 28 of the Employment Act. The appellant took the respondent as a casual employee and hence did not allocate any annual leave. This is confirmed by the fact that she worked continuously for 7 days each week without a rest day under the mistaken belief that she was casual. Without the work records to confirm how annual leave was allocated, from November 2018 to 2 March 2020, a claim for Ksh.14, 175 is modest and is hereby confirmed.
A certificate of service has since been issued and is part of the record of appeal. To order the same be issued is without any foundation.
On costs, the claims analyzed above, each party should bear its costs for the appeal and the lower court proceedings.
Accordingly, judgment in Mombasa MCELRC No. E250 of 2021 is set aside and the following orders are issued;
- Unpaid leave Ksh.14,175;
- Rest days’ pay Ksh.35,100;
- For the appeal and lower court proceedings, each party bears its costs.
Delivered in open court at Mombasa on this 17 day of October 2024.
M. MBARŨ
JUDGE