This article looks at the legal position in a situation where an employee is on the wrong but the termination is not in accordance with the termination procedure stipulated in Section 41 of the Employment Act (re: disciplinary hearing). The question is, if this procedure is not followed, what effect is there on the termination?

Case study: Julimatt Enterprises Limited vs V.M.K, Civ Appeal No. 262 of 2014

This case was decided by the Court of Appeal on 23rd February 2018. A summary of the facts is that the employee was employed as an Internal Control Systems Manager, his services were terminated summarily without warning and without following the stipulated termination procedure. His employer did not deny having failed to follow the correct procedure but stated that they were justified in terminating the employee because of negligence, which the employee had admitted to, as well as fraud. The Industrial Court awarded him compensation of 6 months salary for the unfair termination. The employer appealed against this award; the following important points were highlighted by the Court of Appeal: –

  1. A termination that does not comply with the procedure set out in Section 41 of the Employment Act is unfair;
  2. In determining the amount of compensation to award a person who has been unfairly terminated, the court must consider the several factors spelt out in Section 49 of the Act, which includes: –
    1. the wishes of the employee;
    2. the circumstances in which the termination took place, including the extent to which the employee contributed to the termination;
    3. the practicability of recommending reinstatement or re-engagement;
    4. the legal principle that reinstatement or re-engagement should not be ordered except in exceptional circumstances;
    5. the employee’s length of service;
    6. the employee’s reasonable expectation as to the length of time for which his employment would have continued;
    7. the opportunities available to the employee for securing alternative employment;
    8. any amounts owed to the employee;
    9. any expenses reasonably incurred by the employee as a consequence of the termination;
    10. any failure by the employee to reasonably mitigate the loss of employment by seeking alternative employment;
    11. any ex gratia amounts paid to the employee in respect of the termination.
  3. In deciding the compensation to award, a judge must indicate the reason/rationale for giving the award;
  4. In this case, the judge had failed not only to give her rationale for the award but also to take into account several factors, including, the reasons that led to the employee’s termination, including the employee’s admitted negligence, the fact that the employer had treated the employee fairly leniently by writing off a huge amount lost as a result of the employee’s negligence as well as the fact that the employee was paid salary in lieu of notice and prorated leave;
  5. In light of 4 above, there was no justification for the award of 6 months compensation which the Court of Appeal proceeded to reduce to 2 months!

There you have it, a termination that is done without following the stipulated procedure is an unfair termination but the circumstances surrounding the termination are very important factors in determining the award.





About Anne Babu

Anne is an Advocate of the High Court of Kenya and the Founding Partner of Anne Babu & Co. She has practised employment law for over 12 years and her employment law practice has been recognized by the prestigious Chambers & Partners. Anne cares about employers and their labour issues.


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  1. Daniel says:

    Dear Ann. Many thanks for the brilliant commentary. I find this confusing – “his services were terminated summarily without warning” . Because i thought summary termination does not require warning; not so?

    1. Anne Babu says:

      The warning, in this case, I believe referred to the fact that no hearing was given. I agree, no warning is required before a summary dismissal is done.

  2. Patrick Thuo says:

    Again! Happening left, right and centre. Keep shedding light on these matters Ann.

    While at it, I please shed light on some matters regarding working hours. I have come across employees especially gas station attendants who clock 12 hours a day for 6 days a week. They are not paid for any overtime but it is happening widely. How is this accounted for given the 52 hours weekly stipulation?

    1. Anne Babu says:

      They should get overtime for time worked in excess of the 52 hours or see a labour officer to demand this right on their behalf.

  3. ANGELINE says:

    Dear Ann,
    One of our employee (still an employee) is claiming off days totaling to Khs.533467 being accumulated off days from 2002 – 2017. He is a night watchman who says since then he has been not taking his off days. It is true, he has not. How can we handle this case

    1. Anne Babu says:

      Off days should be compensated by overtime at the rate of twice the normal hourly rate. He can only claim for 3 years back since employment claims lapse after 3 years from the date of the cause of complaint.

  4. jemk says:

    if an employee has done wrong like stealing, is there notice to be given/ like if they were arrested too on the issue. is that enough for termination or we still have to give notice?

    1. Anne Babu says:

      You have to give a letter containing the allegations and then hold a disciplinary hearing before you terminate. An employee who has stolen can be summarily dismissed in which case no notice is given.

  5. Eccra says:

    Kindly comment on warning letters and letters to show cause, when and where are they applicable.

    1. Anne Babu says:

      The posts I have done on “Separation” should be able to shed some light.

  6. William Aol says:

    Great insights there Anne on the topic; When the employee is wrong & the stipulated termination procedure is not followed.

    On the same breath, what’s your legal professional thoughts and advice on the following;
    An employee services has been abruptly terminated due to inability of an organization to pay his/her salary with a written letter. Before this the employees probationary period of three months had elapsed and her contract was to be renewed after the end of this period. The employee proceeded with her duties for another two months after the probationary period but this time under no written contractual agreement.

    Her services are terminated after the two months. Advice also in the event He/She may have been paid part of one month salary and the second month’s salary is due?

    DHRM,BsHRM, Member IHRM

    1. Anne Babu says:

      She is deemed to have been confirmed because no communication to the contrary was given prior to the end of the probation period. She is entitled to a months’ notice or pay in lieu, pay until last day of employment and pro-rated accrued leave pay. No severance is payable because she had not worked for a full year. The notice should also be sent to the labour officer.

  7. nice one
    is everything on employment act?

    1. Anne Babu says:

      Your question is not clear.

  8. Jeff says:

    Hi Ann, how many hours management staff need to work, we are often told management staff must work for 11hours daily including Saturday foreign managers are paid 3 to 5 times more yhan kenyans plus so many other benefits than Locals dont have also staff are hired and fired without any proper reasons how can such challenges be addressed.

    1. Anne Babu says:

      A person who is terminated unlawfully should exercise their legal right to sue the employer for damages or reinstatement. Working hours should be stipulated in the contract. Generally, maximum weekly working hours for those who work during the day are 52.

  9. Barasa says:

    A staff dismissed for not meeting his sales targets due to his medical condition.does he have a case?

    1. Anne Babu says:

      Depends on the facts. Was the dismissal due to poor performance or his illness?

  10. Zephaniah nyandara says:

    Is it fair an employer to double deduct the day am off during public holiday,and double pay the public holiday those present only?
    Is it fair an employer to advise me to resign because I’ve worked more than ten years without resigning?
    Is fair my manager to unpredictably and frequently change my pragreed assignment or make me work different departments as a reliever to on off?

    1. Anne Babu says:

      The answer to all your questions is that, on the face of it, appears that you are a victim of unfair labour practices.

  11. TUNDO says:

    My employer has restructured our pay slips by adding 15% of basic salary for house allowances without increasing our salaries. Is this within the law or just blackmailing employees?.kindly advise on what action to take. Regards

    1. Anne Babu says:

      If you were not being a separate house allowance before, the change should be with your consent.

  12. Davis Charana says:

    I hope that this email finds you in good health. The group of companies i work for is scheduled for a redundancy i have already talked discussed with them about their jobs and alternative companies that they can work for, some of them have already gotten job offers. i had issued them with notices for those who are on contract basis.
    The issue is the one who are permanently employed how do i go about it? are they supposed to be given notice ? their offer letters they singed does not include gratuity and we pay for their NSSF kindly advice me on the way on how to terminate the employment of permanent employees.
    Only 3 permanent employees will be declared redundant

    1. Anne Babu says:

      Please see the posts that I have written on redundancy. They should be given notice and paid a severance.

  13. Anne Babu says:

    Pole, quite a lot to deal with. Your terminal dues are payable on the last day of employment. It sometimes happens that the employer does not have all the funds and offers to settle in monthly instalments, in which case, you can opt to wait and see whether they will come through. Note that if you did not give notice, they can decide to deduct that amount – the minimum notice period is one month – this applies whether or not you have a contract as long as you were being paid monthly. It is wrong for them to deduct salary for the the week they were closed.

  14. Daniel Kamanja says:

    Can an employer change employee’s terms of service without informing the employee.
    Can the employer charge the terms of an employee who is employed on permanent basis to a contract with out endind the first contract

  15. Gats says:

    After the disciplinary hearing, the committee recommended management to take appropriate disciplinary action. Against the employee. who is supposed to recommend the appropriate disciplinary action is it the line manager?

    1. Anne Babu says:

      The disciplinary committee with the guidance of HR

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