Johnstone Luvisia v Allpack Industries Limited [2019] KEELRC 1641 (KLR)

REPUBLIC OF KENYA

IN THE EMPLOYMENT AND LABOUR RELATIONS COURT AT NAIROBI

CAUSE NO. 653 OF 2014

(Before Hon. Lady Justice Maureen Onyango)

JOHNSTONE LUVISIA......................................................CLAIMANT

VERSUS

ALLPACK INDUSTRIES LIMITED............................RESPONDENT

JUDGMENT

Vide his memorandum of claim dated 15th April and filed on 16th April 2014, the claimant avers that he was unlawfully/wrongfully summarily dismissed from employment by the respondent and prays for orders against the respondent as follows –

(a) A declaration that the Respondent's decision to dismiss the claimant from his employment was wrongful and unfair.

(b) A declaration that the claimant is entitled to payment of his terminal dues and compensatory damages as pleaded.

(c) An order for the Respondent to pay the Claimant his due terminal benefits and compensatory damages totalling to Kshs.350,501/= as tabulated below–

i.. Salary for 15 days worked in May 2011

ii. being Kshs.15x 22,613. ..........................................Kshs.11,306

30

iii. One Month's salary in lieu of notice......................Kshs.22,613

iv. Service/Gratuity for the entire period of service in accordance

with the Regulation of Wages (Protective Security Service)

Order 1998 being 4 years x 15/30 x Kshs.22,613. ......Kshs.45,226

v. The Claimant further submits that as a result of the illegal and unfair summary dismissal complained of above, he suffered abrupt loss of income and trauma and inability to meet his continuing obligations as a result of which he suffered damages for which he seeks compensation at 12 months gross salary being

Ksh.l2,000 x 12 months....................................................... Ksh.271,356

Total   Kshs.350,501

(d) Interest on (c) above from the date of filing suit till payment in full.

(e)  Cost of this suit plus interest thereon.

The respondent filed a memorandum of response o 29th June 2016 in which it denies the averments in the memorandum of claim and prays that the same be dismissed with costs.

At the hearing the claimant testified on his behalf while the respondent’s Human Resource Officer Mr. Mwacheda S. J. Robert, RW1 testified on its behalf.  Parties thereafter filed and exchanged written submissions.

Facts and Evidence

The uncontested facts of the case are that the claimant was employed by the respondent on successive fixed term contracts between May 2007 and May 2011.  Prior to the fixed term contract of 2007, he had worked for the respondent on casual basis from 2003.  His last contract was for one year commencing 11th May 2010 and lapsing on 10th May 2011.

According to the claimant, he worked up to 15th May 2011 when he was called to the office of the Human Resource Officer, Robert Mwacheda where he was handed a clearance form.  When he asked why he was asked to clear he was informed that although his work was good his Supervisor did not want to work with him.  He was then issued with a certificate of service.

For the respondent it is averred that the claimant’s contract was for a fixed term and was not renewed upon expiry.

The issues for determination are therefore whether the termination of the claimant’s contract was unfair and if he is entitled to the prayers sought.

It is submitted for the claimant that the termination was unfair because no reasons were given for the termination and neither was he taken through any disciplinary process.  The respondent on the other hand submits that the claimant was not terminated by the respondent, but his contract came to an end.

From the evidence adduced on record, the claimant was on a fixed term contract expiring on 10th May 2011.  He did not adduce any evidence on the exact date he left service although he has claimed for salary up to 16th May 2011.  The clearance certificate has no date while the certificate of service is dated and signed on 3rd June 2011 but states the claimant was in the respondent’s employment from May 2007 to May 2011.

The claimant testified that when he asked why he was issued with a certificate of service he was informed that his work was good but his Supervisor did not wish to work with him anymore.

RW1 testified that the claimant was alerted about the non-renewal of his contract in April 2011 and given a clearance form.  He further testified that the claimant had disciplinary issues which were in his personal file but the same were not produced.  RW1 also testified that there were appraisal forms for the claimant which were not produced in court and that the reasons for non-renewal were “with the people the claimant was involved with”, which again, was not adduced in court.

The evidence on record points to the fact that the claimant was never notified of non-renewal of his contract until after the contract had lapsed and that there were reasons for non-renewal which were never brought to his attention so that he had a legitimate expectation of the renewal of his contract.

The legal position in respect of non-renewal of fixed term contracts is as enunciated by Rika J. in the case of Margaret A. Ochieng –V- National Water Conservation and Pipeline Corporation (2014) eKLR as follows –

“Courts have upheld the principle that fixed-term contracts carry no expectancy of renewal, in a catena of judicial authorities. This Court has done so in Industrial Court Petition No. 35 of 2012 between George Onyango v. The Board of Directors Numerical Machining Complex Limited & Ors, [2014] e-KLR and in the Industrial Court Cause No. 1541 of 2010 between Bernard Wanjohi Muriuki v. Kirinyaga Water and Sanitation Company Limited and Others.  The general principle is that fixed-term contracts carry no expectation of renewal.

Exceptions to this general principle are limited. The expiring contract may contain a clause giving expectancy of renewal as discussed by Hon. Justice Byram Ongaya in Industrial Court Case between Ruth Gathoni Ngotho- Kariuki v. the Presbytery Church of East Africa & Anor, [2012] e-KLR.  In this case the Employer was obliged to give the Employee notice, 3 months before the expiry of her fixed-term contract, indicating whether her contract would be renewed or not. It was the Employer, unlike the present dispute, who would express the intention on the renewal. The Employer failed to do so, and the Court found that the Employee was justified in legitimately expecting there would be renewal. This Court similarly expressed the view in the case of Bernard Wanjohi Muriuki that an outgoing contract may impose the expectancy of renewal.

In the United Nations Appeals Tribunal [Tribunal D’ Appel Des Nations Unies] UNAT, Case No. 2010 -125between Frenchon v. The Secretary- General of the United Nations, the Tribunal found that the decision of an Employer not to renew a fixed-term contract may be challenged on limited grounds. These include where the actions of the Employer give rise to legitimate expectation on the part of the Employee, that there would be renewal; and two, where the decision not to renew is based on improper motives or there are countervailing circumstances.”

In the present case, the claimant had worked continuously from 2003 on casual terms and from May 2007 to May 2011.  He thus had expectation of renewal which would have been managed if he was informed of non-renewal even one month before the expiry date of the contract.  Waiting until after expiry thereof was unfair to the claimant as he was placed in a position which he had not anticipated and which was not of his own making.  It was within the respondent’s ability to inform the claimant of the non-renewal beforehand as the respondent was in control of the same.

I would however not find this unlawful termination, just untidy for failing to manage the claimant’s legitimate expectation for which I would grant the claimant three months’ salary to cater for the inconvenience of finding himself out of a job unexpectedly.

Having found thus, the claimant is not entitled to a declaration that his dismissal was unfair as there was no dismissal.  He is further not entitled to compensation otherwise than the management of his expectations, which I have already addressed.

Having admitted that he was a member of NSSF the claimant is not entitled to gratuity or service pay as his terms of contract did not provide for the same.  If he has any issue with non-remittance of the deductions made from his wages for remittance to NSSF he is at liberty to complain to NSSF which is well placed to address that with the respondent.

The claimant was paid all his terminal dues including salary for May 2011 as per payslip for May 2011.  He is thus not entitled to the prayer for salary for 15 days worked in May 2011, which thus fails.

For reasons stated above, I would dismiss the claimant’s claim with the exception of the award of three (3) months’ salary in the sum of Kshs.36,294. 00.  I further award him instructions’ fees only based on the amount awarded.

DATED, SIGNED AND DELIVERED AT NAIROBI ON THIS 20TH DAY OF MAY 2019

MAUREEN ONYANGO

JUDGE