Mahamud & another v Fayaz Bakers Limited & another [2022] KEELRC 13341 (KLR)

Mahamud & another v Fayaz Bakers Limited & another (Cause 106 of 2018) [2022] KEELRC 13341 (KLR) (24 November 2022) (Judgment)

Neutral citation: [2022] KEELRC 13341 (KLR)

Republic of Kenya

In the Employment and Labour Relations Court at Mombasa

Cause 106 of 2018

AK Nzei, J

November 24, 2022

Between

Musa Khalif Mahamud

1st Claimant

Abdi Mohamed Abdi

2nd Claimant

and

Fayaz Bakers Limited

1st Respondent

S.D.K. Security Services

2nd Respondent

Judgment

1. The suit herein was instituted vide a statement of claim dated February 28, 2018 and filed in this Court on March 1, 2018. The 1st Respondent entered appearance on March 15, 2018 and filed Response to the Claim on April 18, 2018. An amended statement of claim dated May 28, 2018 was filed on June 8, 2018. The 1st Claimant’s case against the Respondents was withdrawn, with no order as to costs, on June 29, 2022.

2. The 2nd Claimant pleaded that he was, at all material times, employed by the Respondents and that in the alternative, the 1st Respondent had sourced the employment service of the 2nd Claimant from the 2nd Respondent as a security guard since January 2, 2010 at a monthly salary of Kshs 9,500.

3. The 2nd Claimant further pleaded:-a.that the 1st and 2nd Respondents were jointly and severally liable for the 2nd Claimant’s employment and payments.b.that in August 2017 the Respondents, through their duly authorized officers, verbally, illegally and unlawfully terminated the 2nd Claimant’s employment without any reason or due process or payment of his dues.c.that termination of the 2nd Claimant’s employment was illegal and was in contravention of the Employment Act 2007 and the Constitution because the 2nd Claimant was not given any notice or reasons for the termination, and was not given an opportunity to be heard.

4. The 2nd Claimant set out his claim against the Respondents as follows:-a.One month salary in lieu of notice…………………….Kshs 9,500b.House allowance (3,200x96 months)……………….Kshs 307,200c.Gratuity pay (15 days x 8 years x316)……………….Kshs 37,920d.Leave for 8 years worked ………………………………Kshs 53,088e.Leave travelling allowance (8 years)…………………Kshs 17,696f.Public holidays & Sundays allowance worked (512 days x Kshs 316 per day ………………………………………….Kshs 161,792g.Overtime worked (4 hours per day x 2,880 days x 40. 00 per hours)………………………………………………………….Kshs 460,800h.Unfair termination (12 months x Kshs 9,500) ….Kshs 114,000i.A declaration that the 2nd Claimant’s dismissal was unfair.j.Certificate of service.k.Costs and interest.

5. The 2nd Claimant filed his written witness statement dated February 28, 2018 and an evenly dated list of documents, listing two documents. The listed documents were the 2nd Claimant’s ID card and a demand letter dated February 1, 2018.

6. The 1st Respondent did not amend its Response to the claim after an amended statement of claim was filed on June 8, 2018. It is pleaded in the 1st Respondent’s Response to the Statement of Claim dated April 18, 2018:-a.that the 1st Respondent denied having employed the 2nd Claimant or having sourced his employment services from the 2nd Respondent as pleaded.b.that if the 1st Respondent sourced the 2nd Claimant’s employment services from the 2nd Respondent, which the 1st Respondent denied, then it was a contract between the 1st and 2nd Respondents for the provision of security services on the 1st Respondent’s premises; and that there was no contract of employment between the 1st Respondent and the 2nd Claimant.c.that the 1st Respondent was a stranger to the 2nd Claimant’s particulars of terminal dues, and that it could not issue a Certificate of Service to a stranger.

7. When the trial opened on June 29, 2022, the 2nd Claimant adopted his filed witness statement as his testimony and produced in evidence the documents listed on his list of documents referred to in paragraph 5 of this judgment. The Claimant further testified:-a.that he started working on January 2, 2010 and was being paid Kshs 9,500 per month.b.that he (the 2nd Claimant) was taken to the 1st Respondent by the 2nd Respondent, and that the 1st Respondent employed him.c.that the 2nd Claimant was guarding the 1st Respondent’s yard opposite Coast General Hospital, and was being paid by the 1st Respondent through their clerk, one Abdulahi, and was being paid in the 1st Respondent’s office.d.that he 2nd Claimant was signing in a book for his salary, and was not being issued with any voucher or payslip.e.that the 2nd Claimant’s employment was verbally terminated in August 2017 by the 1st Respondent’s director, Mohammed Fayaz, whom the 2nd Claimant knew personally.f.that the 2nd Claimant knew other employees of the 1st Respondent, including one Ahmed Salim (RW1).g.that the (2nd Claimant) was the 1st Respondent’s employee, but the 1st Respondent never gave him any written contract of employment.

8. Cross-examined, the 2nd Claimant testified that the 2nd Respondent was an employee of the 1st Respondent, and worked there even as at the time of trial herein, and that he had sued the two jointly because they were one and the same thing.

9. The 1st Respondent called one witness (RW1), who adopted his filed witness statement dated May 18, 2018 as his testimony. The witness, Ahmed Salim, also produced in evidence the documents listed on the 1st Respondent’s list of documents dated January 11, 2019. The witness further testified that he knew the 2nd Claimant by seeing him guarding the 1st Respondent’s yard, and that the 2nd Claimant was a security guard employed by the 2nd Respondent, from whom the 1st Respondent hired security guards. That there existed a contract between the 1st and 2nd Respondents in that regard.

10. Cross-examined, the 1st Respondent’s witness (RW1) testified:-a.that he (RW1) had nothing to show that the 2nd Claimant was employed by the 2nd Respondent, and that the agreements produced in evidence by the witness had not been signed by the 2nd Respondent; and that he had not exhibited any agreement between the 1st and 2nd Respondents for the year 2010. b.that the witness (RW1) had no list of the 2nd Respondent’s employees working for the 1st Respondent, and had no break-down/list of guards paid the amounts invoiced by the 2nd Respondent.

11. The 2nd Respondent did not enter appearance and did not file any pleadings. The 2nd Respondent did not, therefore, participate in the trial.

12. Having considered the pleadings filed and the evidence presented by the 2nd Claimant and the 1st Respondent, issues that emerge for determination, in my view, are as follows:-a.whether the 2nd Claimant was an employee of the 1st Respondent.b.whether the 1st Respondent terminated the 2nd Claimant’s employment, and if so whether the termination was unlawful and unfair.c.whether the 2nd Claimant is entitled to the reliefs sought.

13. On the first issue, the 1st Respondent (RW1) testified that the 2nd Claimant worked for the 1st Respondent as a security guard, and did not deny that the 2nd Claimant worked for it as such from January 2, 2010 upto August 8, 2017. The 1st Respondent did not in any way rebut the 2nd Claimant’s evidence that his salary was, through out the period of employment, paid by the 1st Respondent and that it was the 1st Respondent’s director who verbally terminated his employment.

14. The 1st Respondent did not adduce any evidence to prove its allegation that the 2nd Claimant was an employee of the 2nd Respondent. The 1st Respondent did not also demonstrate that there existed any agreement and/or valid agreement between 1st and 2nd Respondents in the year 2010 for provision of security guards to the 1st Respondent by the 2nd Respondent. It is my finding that the 2nd Claimant was an employee of the 1st Respondent.

15. Tied to the first issue is the second issue on whether the 2nd Claimant’s employment was terminated by the 1st Respondent and whether the termination was unlawful and unfair. The 2nd Claimant pleaded, and subsequently testified that his employment was on 8th August 2017 verbally terminated by the 1st Respondent’s director, Mohammed Fayaz, whom the 2nd Claimant knew personally. This evidence was not rebutted and/or controverted by the 1st Respondent, and its said director did not testify in Court in rebuttal. Indeed, the 1st Respondent did not even attempt to tell the Court how the 2nd Claimant stopped working on its property / yard. I find and hold that the 2nd Claimant’s employment was terminated by the 1st Respondent.

16. As to whether the termination was unlawful and therefore unfair, Section 41 of the Employment Act is called in aid. Section 41 provides as follows in mandatory terms:-“(1)Subject to Section 42(1), an employer shall, before terminating the employment of an employee, on the grounds of misconduct, poor performance or physical incapacity explain to the employee, in a language the employee understands, the reason for which the employer is considering termination and the employee shall be entitled to have another employee or a shop floor union representative of his choice present during this explanation.(2)Notwithstanding any other provision of this part, the employer shall, before terminating the employment of an employee, or summarily dismissing an employee under Section 44(3) or (4) hear and consider any representations which the employee may on the ground of misconduct or poor performance, and the person, if any chosen by the employee within subsection (1) make.”

17. The 1st Respondent was not shown to have complied with the foregoing mandatory procedural requirements as outlined in the foregoing statute. The Court of Appeal held as follows in the case of CMC Aviation Limited v Mohammed Noor [2015] eKLR:-“In view of the foregoing, we find that the appellant’s act of summarily dismissing the Respondent without giving him an opportunity to be heard amounted to unfair termination as defined under Section 45 of the Employment Act. In Kenya Union of Commercial Food and Allied Workers v Meru North Farmers Ssacco Limited [2013] eKLR, the Industrial Court held that whatever reason or reasons that arise to cause an employer to terminate the services of an employee, the employee must be taken through the mandatory process as outlined under Section 41 of the Employment Act. That applies in a case of termination as well as in a case that warrants summary dismissal. See also Mary Chemweno Kiptui v Kenya Pipeline Company Limited [2014] eKLR”

18. The Court of Appeal also held as follows in the case of Kenfright[EA] LTD vBenson K Nguti[2016] eKLR:-“apart from issuing a proper notice according to the contract (or payment in lieu of notice provided), an employer is duty bound to explain to an employee, in the presence of another employee or union official, in a language the employee understands, the reason or reasons for which the employer is considering termination of the contract. In addition, an employee is entitled to be heard and his representations, if any, considered by an employer before the decision to terminate his contract of service is taken….We come to the conclusion and find, in agreement with the trial Judge, that the termination of the Respondent’s contract of service in the circumstances, was unfair, the payment in lieu of notice notwithstanding…”

19. It is my finding that termination of the 2nd Claimant’s employment by the 1st Respondent contravened the law, and was therefore unlawful and unfair. I so declare.

20. On the third issue, and having found that termination of the 2nd Claimant’s employment was unfair, I award the 2nd Claimant the equivalent of nine months’ salary as compensation for unfair termination of employment, that is Kshs 9,500x 9 = Kshs 85,500. I have taken into account the circumstances in which the 2nd Claimant’s employment was terminated. The Claimant pleaded that his monthly salary was Kshs 9,500 at the time of termination of employment. This was not disputed by the 1st Respondent.

21. The claim for Kshs 9,500 being one month salary in lieu of notice is allowed.

22. On the claim for house allowance, the 1st Respondent did not adduce any evidence to demonstrate that the 2nd Claimant’s monthly salary included house allowance or was consolidated. I allow the claim pursuant to Section 31 of the Employment Act and award the Claimant 15% of his salary multiplied by the number of months worked as prayed. That is Kshs 1,425X96 months = Kshs 136,800.

23. The claim for service gratuity is allowed as prayed, and I award the 2nd Claimant Kshs 37,920 as prayed. The claim for unpaid leave days was not disputed, and is allowed as prayed at Kshs 53,088. The claims for leave travelling allowance, allowance for public holidays and Sundays worked, and payment for overtime worked, were neither pleaded nor proved, and are declined.

24. Finally, and having considered written submissions filed by Counsel for both parties, judgment is hereby entered for the 2nd Claimant against the 1st Respondent for:-a.The equivalent of nine months’ salary being compensation for unfair termination of employment ……………………………….....Kshs 85,500b.One month salary in lieu of notice ……………Kshs 9500c.Unpaid house allowance………………...…..Kshs 136,800d.Service gratuity………………………………....Kshs 37,920e.Unpaid leave days for 8 years……………....Kshs 53,088 Total Kshs 322,308

25. The warded sum shall be subject to statutory deductions under Section 49(2) of the Employment Act.

26. The Claimant is awarded costs of the suit and interest.

DATED, SIGNED AND DELIVERED AT MOMBASA THIS 24TH DAY OF NOVEMBER 2022AGNES KITIKU NZEIJUDGEORDERIn view of restrictions on physical Court operations occasioned by the COVID-19 Pandemic, this Judgment has been delivered via Microsoft Teams Online Platform. A signed copy will be availed to each party upon payment of Court fees.AGNES KITIKU NZEIJUDGEAppearance:Miss Memia for ClaimantMr. Mathare for Respondent