https://new.kenyalaw.org/akn/ke/judgment/keelrc/2026/1888

**REPUBLIC OF KENYA** **IN THE EMPLOYMENT AND LABOUR RELATIONS COURT** **AT NAIROBI** **CAUSE NO. E339 OF 2022** *(Before Hon. Justice Abuodha Jorum Nelson)* **SABAH AHMED.……..…………………………………...……** **CLAIMANT** **VERSUS** **SILVER STAR AUTOMOBILES LIMITES………………RESPONDENT** **JUDGMENT** **REPUBLIC OF KENYA** **IN THE EMPLOYMENT AND LABOUR RELATIONS COURT** **AT NAIROBI** **CAUSE NO. E339 OF 2022** *(Before Hon. Justice Abuodha Jorum Nelson)* **SABAH AHMED.……..…………………………………...……** **CLAIMANT** **VERSUS** **SILVER STAR AUTOMOBILES LIMITES………………RESPONDENT** **JUDGMENT** 1. By a statement of claim dated 23rd May, 2022, the claimant pleaded among others that: 2. The Claimant was employed by the Respondent in the year 1999 to the month of April, 2021 performing managerial duties at the Respondent’s Business Premises. 3. In the month of January,2021 the Claimant issued a three months’ notice to the Respondent to leave the Respondent’s employment. This is in accordance with the law and for the purposes of handing over the work project and documents under her care, and upon expiry of the said notice, the Respondent’s Managing Director Mr Mohamed Abdalla requested the Claimant to extend the said notice by two more months in order for her to train the incoming manager and other members of staff working for the Respondent. 4. On 3rd May 2022, the Respondent verbally told the Claimant to leave without following the laid down procedure dictated under the Employment Act, 2007 and the principles of natural justice with the promise of making good the payment of her dues including her salary and gratuity and annual leave payment. 5. To date the Respondent has not made any payment with regard to the aforementioned promise despite the numerous demands from the Claimant on the same. 6. At the time of leaving the Respondent’s employment, the Claimant was earning a salary of Kshs. 148,550/=. 7. The Claimant’s claim against the Respondent is for service pay, unpaid leave, salary arrears for the month of March, 2021, commission and balances of loan granted to the Respondent by the Claimant as particularized here-below; 8. An order compelling the Respondent to pay the Claimant a sum **Kshs. 6,269,433.00/-** made up as follows: 9. Service pay @ 15 days for each year worked and completed as provided for under the Employment Act, 2007 (Kshs. 148,550 x 22 x 15/26= Kshs. 1,885,442.00/- 1. Unpaid leave for 22 years worked but not paid as provided for under Section 28 of the Employment Act, 2007 (Kshs. 148,550x 22) = Kshs. 3,268,100.00/- 2. Salary arrears for the month of March 2021…Kshs.28,891.00/- 3. Commission on Kshs. 60,000,000/- Kshs.(1,5%x 60,000,000) = Kshs. 900,000.00/- 4. Balance of first Loan given to the Respondent of 500USD (l 18x 500)= Kshs 59,000.00/- 5. Balance of second loan given to the Respondent..Kshs.128,000.00/- 6. An order compelling the Respondent to pay the Claimant interest on the above at the rate of 25% from the date of termination on employment until payment in full. 7. An order compelling the Respondent to issue the Claimant with a certificate of Service. Total Kshs. 6,269,433/- 1. An order compelling the Respondent to pay the Claimant costs of the suit. 2. The Respondent filed a Memorandum of Response and counterclaim dated 21st June, 2022 and averred inter alia:- 3. It admits paragraphs 3 of the Memorandum of Claim and in further response thereto avers that the Claimant was at all material times employed as the Respondent's General Manager, and among her responsibilities were: 4. Day-to-day overall management of the company's business; 5. Supervision of personnel and exercising overall human resource and administration roles; 6. Maintaining company records including business records, tax and government payment records, human resource records for salaries, wages, leave and other matters; 7. Ensuring safe custody of company resources and prudent application of company finances; 8. Accessing company bank accounts for purposes of meeting the company's obligations; 9. Updating the company's board of directors on regular basis on the business and performance of the company, and in all relevant matters. 10. It admits paragraph 4 of the Memorandum of Claim only to the extent that it speaks of the Claimant's resignation, but avers that the Claimant proceeded about the resignation callously, maliciously, and with a view to undermining the Respondent's business interests by: 11. Refusing to carry out proper handing over as directed by the Respondent; 12. Refusing to instruct bank signatory change when she knew the bank changes were required before she exited; 13. Deleting important company and business records on her way out; 14. Hiding important credit and debt records of the business to undermine recoveries and future business interests of the Respondent; 15. Having been assigned, together with her husband mentioned herein, mobile phone lines for company use, delinked them from bank accounts to frustrate the company business; 16. Re-registered company mobile phone lines into her and her husband's name on exit from the company in order to paralyze the company's communications when she was well aware that the lines were for business communications; 17. Spreading malicious rumours about the business, on her exit, and scandalously alleging and informing the company customers that it is not a going concern; and 18. Generally, acting in a manner inconsistent with the ‘smooth' handing over she was directed to do thus comprising the Respondent's business. 19. It denies paragraphs 5 and 6 of the Memorandum of Claim and in further response thereto avers that: 20. The Claimant voluntarily resigned from employment and was paid her salary during the notice period; 21. The claimant was not entitled to any hearing on termination of her employment by voluntary resignation, the resignation having been accepted unconditionally by the Respondent; 22. The Claimant is not entitled to any payment from the Respondent as alleged or at all; 23. No demand for payment has ever been made by the Claimant as alleged, having the understanding that she was owed nothing. 24. It denies paragraph 7 of the Memorandum of Claim and in further response thereto avers that the Claimant's monthly gross salary, including house allowance, as at the time of her resignation was Kshs. 35,000/-. 25. It denies in entirety the particulars of the Claimant's claims of dues set out in paragraph 7 of the Memorandum of Claim and in further response thereto avers that: 26. The Claimant was at all times entitled to annual, leave, sick leave, compassionate leave, and maternity leave, and she generously utilized these facilities all through her employment; 27. The Claimant proceeded on maternity leave on full pay nine times during her employment; 28. The Claimant proceeded on annual leave regularly, on full pay, and does not have any balance of leave days to claim; 29. In any case, a claim for unutilized leave days stretching for 22 years stands defeated by Statutes of Limitation, and the Respondent will raise an appropriate objection to this claim; 30. In any case, the Claimant, being the General Manager, was responsible for scheduling staff leave including for herself, and cannot in that respect rely on her neglect of duty to claim compensation; 31. The Respondent provided to the Claimant, by way of an advancement, a fully paid house in Green 2 Estate South C, Nairobi and two plots of land in Utange, Mombasa transferred to the Claimant and her husband's name, Abubakar Abdulkadir who was at all material times serving as the Respondent's Sales Manager, as an upward consideration for all employment benefits post-exit that may arise from their employment; 32. The value of the said house and the Utange plots by far exceeds the Claimant's claims and the Respondent is entitled to a refund of the difference should any of the Claimant's claims be found to be payable; 33. The Respondent fully paid the Claimant's NSSF contributions and the claim for service pay is not merited; 34. The Respondent did not procure any credit facility from any of its employees, and the Claimant's allegation that she advanced a loan to her employer is spurious, and has no basis; 35. The Claimant, having been entrusted with the duties of preparing staff salary accounts, accessing bank accounts, M-PESA, and other company resources, unlawfully, unfaithfully and without authorization paid herself more resources from the company; 36. The Claimant unlawfully paid off her personal expenses, including school fees for her daughter, from the Respondent's business accounts, and is liable to reimburse these claims which are treated as an advancement to her; 37. The Respondent will advance a counterclaim for refund of the monies unlawfully and unfaithfully siphoned by the Claimant from the company; 38. In all, the Claimant is not entitled to a single cent from the Respondent and in fact is the one who owes the Respondent as pleaded above, and in the counterclaim, below. COUNTERCLAIM 1. The Respondent (claimant in the Counterclaim) reiterates wholly the averments above set out in the Statement of Response, and counterclaims against the Claimant (Respondent in the Counterclaim) for: 2. Monies unlawfully and unfaithfully drawn by the Claimant/Respondent during the course of her employment and in violation of her employment contract; 3. Value of the house and the two Utange plots advanced to her as an employment benefit by the employer, having voluntarily terminated her employment contract and thereby denied the employer value for the benefit advanced; 4. Costs and interest. 5. The Respondent/Claimant avers that the Claimant/Respondent was at all material times employed by it as the General Manager, and among her responsibilities were: 6. Day-to-day overall management of the company's business; 7. Supervision of personnel and exercising overall human resource and administration roles; 8. Maintaining company records including business records, tax and government payment records, human resource records for salaries, wages, leave and other matters; 9. Ensuring safe custody of company resources and prudent application of company finances; 10. Accessing company bank accounts for purposes of meeting the company's obligations; 11. Updating the company's board of directors on regular basis on the business and performance of the company, and in all relevant matters. 12. The Respondent/Claimant avers that the Claimant/Respondent breached the terms of her employment by, among other things: 13. Unlawfully advancing herself monies from the company accounts over and above her authorized salary and allowances thus causing the Respondent/Claimant financial losses; 14. Unlawfully paying off her personal expenses, including school fees for her daughter, from the Respondent's business accounts, and is liable to reimburse these claims which are treated as an advancement to her; 15. Failing to properly keep records of the business and company affairs including human resource and personnel records, financial records and other matters; 16. Abusing her position to employ her close relatives without regard to the interest of the Respondent; 17. Failing to ensure that members of staff, including herself, properly carry out their roles thus causing the Respondent/Claimant business losses and financial losses; and 18. Breaching her fiduciary duties to the Respondent/Claimant and unjustly enriching herself and her husband using the company resources. 19. The Respondent/Claimant avers that the Claimant/Respondent has, by her documents filed herein, acknowledged that she received undocumented money by virtue of her employment on the pretext of additional salary, which monies were not authorized by the Respondent/Claimant and equate to unfaithful advancement and unjust enrichment by the Claimant/Respondent. 20. The Respondent/Claimant avers that the Claimant/Respondent owes a total of Kshs 2,608,100 being the said unauthorized and undocumented advancement she made to herself by virtue of her position as the General Manager together with an additional amount of Kshs 2,673,000 she advanced to her said husband by virtue of her fiduciary position. 21. The respondent/Claimant avers that the Claimant/Respondent surreptitiously resigned from employment in order to mask her unfaithful and unlawful actions and to deny the Respondent/Claimant opportunity to subject her to disciplinary action for misuse of company resources, mismanagement of the business and breach of terms of employment contract, and to avoid reimbursement of the monies taken without authorization. 22. The Respondent/Claimant avers that the Claimant/Respondent, together with her husband Abubakar Abdulkadir who was at all materials times working as a Sales Manager with the Respondent/Claimant, were jointly advanced as future employment benefits, the properties known as (i) House No 37A located in Green 2 Estate, South C, whose value stands at Kshs 35,000,000; and (ii) the two plots in Utange, Mombasa whose value stands at Kshs. 7,000,000 each. 23. The Respondent/Claimant avers that the purpose of the advancement was to motivate the Claimant/Respondent to work diligently and productively in order to claim the full value of the properties, and that at the end of her employment on attaining retirement age, the Claimant/Respondent would be entitled to the full value of the house and the Utange plots without any further claim for employment benefits, service pay or any such claim. 24. The Respondent/Claimant avers that it was an express and implied term of the advancement of the house and the Utange plots that should the Claimant and her said husband fail to adhere to their employment duties and leave employment before working to realize the full value of the house, they will forfeit the house to the employer or in the alternative, pay for its market value. 25. The Respondent/Claimant avers that both the Claimant/Respondent and her said husband have prematurely ended the employment relationship and are not entitled to the benefit of retaining the house and the Utange plots, properties of the employer, and are therefore only hold it in trust for the Respondent/Claimant, and the Honourable Court should find as such. 26. The Respondent/Claimant's claim against the Claimant/Respondent is for refund of the unauthorized advancement as pleaded above together with refund of the value of the subject house and Utange plots at the market rate, and release of all business information, property, mobile phone lines and information that she is currently holding on to. 27. The Respondent ultimately prayed that the claim be dismissed with costs and judgment entered in favour of the respondent as prayed in the counterclaim with costs. **EVIDENCE** 1. The Claimant’s case was heard on 4th June, 2024 and the claimant testified among others that she was working for the respondent as a general manager and that she worked for twenty-two years. She adopted her witness statement dated 23rd May, 2022 as her evidence in chief and also relied on her documents in support of the claim as her exhibits. 2. In cross-examination she stated that as general manager, all employees reported to her and further that she had a family and children. She stated that she had nine children and that it was not necessary that she proceeded on maternity leave on each case but only took leave when sick. It was her evidence that she worked together with her husband in the same organization and that her work was very involving as most of the time the managing director was away. She however never complained because her work required her constant presence at the work place. It was further her evidence that she was responsible for approving other staff leave but her leave was to be approved by the managing director in consultation with the HR. 3. Regarding the muster roll, she acknowledged that she was aware of it but could not confirm all the entries. The roll was prepared by one Njeri who was in the HR department. She denied the signature on the muster roll and stated it was not hers. It was further her evidence that the respondent used to remit NSSF deductions. Regarding her salary, she stated that she was paid. Kshs. 148,550/- per month and that the salary was paid in cash against signing a petty cash voucher and that she had the vouchers and further that they were not signed by the managing director. It was further the claimant’s evidence that the vouchers did not have serial numbers and that she signed them as the recipient of the money. The vouchers were prepared by Najma and approved them when Najma was on leave 4. Regarding her claim, she stated that she resigned in January, 2021 and that she was claiming commission as per the agreement with the managing director. She however admitted that she had not produced such agreement on commission. Concerning the loan agreement, she stated that there was no document to show it since they did everything on trust. She further stated that the director was related to her and that they were a family. 5. In re-examination she stated that she used to work from home during maternity and this was to ensure that there was no work disruption and further that she was not able to go on annual leave for similar reasons. She further stated that she was not in the same department as her husband and that they were not sharing roles. She further stated that she resigned in January but was asked to stay on to train the incoming manager. 6. The claimant’s second witness was Najma Ahmed Mohammed who informed the court that she wrote a witness statement on 4th March, 2024 which she sought to rely on as her evidence in chief. 7. In cross-examination, she stated that the claimant was her sister and that she did not have any professional qualifications. She was however employed by the respondent as a cashier and a clerk. She further stated that the claimant was her colleague and that she was senior to her and she reported to her. Her duties included keeping and maintaining records. It was her evidence that she was not responsible for preparing the muster roll and that she was responsible for preparing salary vouchers and cash payments. She denied signing the muster roll. She further stated that her services were terminated and that her salary was Kshs. 40,000/- per month. She however did not have anything in court to show that her salary was as claimed. Regarding terminal dues computation, she stated that the same was not on the respondent’s letterhead and that the document was not signed by any of the directors and further that the petty cash vouchers dated 2nd March, 2021 were not on the respondent’s letterhead and further that they did not have serial numbers. They were not checked and verified by anyone. 8. In re-examination she stated that she was responsible for preparing petty cash and salary vouchers and that she was not familiar with the muster roll. 9. The respondent’s witness was Ms. Mariam Mohammed Abdallah who stated that she wrote a witness statement on 21st June, 2022 which she was relying on as her evidence in chief and the documents filed with the response as her exhibits. 10. In cross-examination, she stated that she still worked for the respondent and did not have any professional qualifications. It was her evidence that the company belonged to her father and that she started working there as a regular worker, secretary, clerk and so on. Her work was to ensure day to day activities go on well. She earned a salary and did not report to anyone. The business of the respondent was selling spare parts and that the respondent had a bank account and that payments were either through Mpesa or bank deposit. It was also her evidence that the respondent pays taxes. 11. Ms. Abdallah further stated that she was in charge of hiring and termination of employee and further that it was a family business hence they do not issue written contracts. She testified that she was in charge of records which included records for salaries and further that there was no record for leave. She further stated that she was in charge of finances and that the respondent uses technology and calls IT experts whenever needed. 12. Regarding the claimant, she stated that she was her cousin and that she was the general manager from 1991 to 2021 and that she resigned on 2nd January, 2021 and that she gave three months’ notice. She took over from the claimant but she did not handover to her. It her testimony that she knew the CW2 and that she was her cousin and that she was an accountant for the respondent. Concerning the claimant, she stated that the claimant was the GM and used to approve leave applications and that she did not know why the claimant never gave herself leave. Concerning the house subject of the counterclaim, she stated that she had no evidence the claimant was given the house. 13. Ms. Abdallah further testified that the claimant refused to remove herself as a bank signatory and that she deleted company records and further that she refused to handover. It was further her evidence that the claimant re-registered the companies’ lines in her name and that she used her husband’s line to transact the company’s business. She however stated that the Mpesa statement did not disclose the phone numbers and that her name was on the muster roll and that she signed receiving salary and that the document was prepared by CW2. It was further her testimony that the claimant advanced herself company’s money without authority and it was showed in the Mpesa statement at page 30. 14. Concerning disciplinary action against the claimant she stated that they did not institute any since this was a family business. In re-examination she stated that everyone working for the respondent was a family member and that they never issued any written contracts. Regarding the name on the Mpesa statement, she stated that the name was stated as Abububakhar Mohammed and that was the number customers used to use when sending money. **CLAIMANT’S SUBMISSIONS.** 1. Claimant’s counsel Mr. Rukwaro submitted among others that throughout the proceedings, there was no dispute that the claimant was employed by the respondent however there was dispute as to how much her monthly salary was. The claimant’s case was that she was paid Kshs. 148,550/- and that the same was supported by documentary evidence that was produced by the claimant, specifically exhibit 1 which were petty cash vouchers that showed the claimant’s salary as claimed. Further, one Najma Mohammed testified that it was her responsibility to prepare salary vouchers, further the witness produced her termination letter showing she was a cashier and the computation of her terminal dues showed the range of her salary. 2. Counsel further submitted that the respondent despite disputing the claimant’s salary, did not produce any evidence to the contrary. Counsel submitted that the only indication of the claimant’s salary produced by the respondent was the muster roll which showed her salary as Kshs. 35,000/- which counsel questioned and wondered if the claimant could have been earning the same salary for the twenty two years she worked for the respondent. 3. On the issue whether the respondent was entitled to judgment on the counterclaim, counsel submitted that the counterclaim was unwarranted. The monies allegedly advanced to the claimant in the course of her employment were not supported by any evidence. The respondent produced Mpesa statements allegedly belonging to the claimant but failed to substantiate if the number belonged to the claimant. 4. Concerning the Utange plots that the respondent claimed the claimant held in trust for the respondent, no evidence was produced to vouch for the claim. 5. Concerning remedies sought by the claimant, counsel submitted that the claimant was entitled to service pay since there was no proof that the respondent registered staff to NSSF and was remitting their deductions. Counsel therefore submitted that the claimant was entitled to service pay for the twenty years she worked for the respondent. Counsel further submitted that the claimant was entitled to leave pay for the period she worked since she never took any leave during that period. **RESPONDENT’S SUBMISSIONS** 1. The Respondent’s counsel Mr. Mbuta on the other hand submitted that it was a settled principle that entitlement to a relief does not arise from the allegations alone but must be founded on clear pleadings and cogent evidence. According counsel, the claimant failed to discharge this burden. According to counsel, the claims fronted by the claimant were either statute barred or premised on mere assumptions incapable of sustaining any legal remedy. 2. On the issue of service pay, counsel submitted that the respondent consistently submitted NSSF dues as evidenced by the muster roll and the claimant’s own admission that the respondent remitted NSSF but she disputed the amount. Regarding the issue of unpaid leave for twenty-two years, counsel doubted that the claimant in her twenty-two years as general manager never took any annual, sick or compassionate leave. The claimant never produced of any record of any leave applied for but was denied. As a general manager, the claimant had oversight over leave records and human resource function, yet she claimed she never brought any concern to the board or lodged a complaint over inability to go on leave. Counsel urged the court to disbelieve this. 3. Concerning the claimant’s actual salary, counsel submitted that official muster roll clearly showed that the claimant’s net pay for the month of March, 2021 was Kshs. 30,430/- and the claimant signed against it. This was consistent with the claimant’s salary as reflected in the payroll records. Although the claimant alleged that her alleged signature on the muster roll was a forgery, she did not produce any evidence of handwriting analysis to substantiate the claim for forgery. Counsel further submitted that even though the claimant wanted to rely on the petty cash vouchers to support her claim for the salary she admitted in cross-examination that the vouchers lacked serial numbers, were not signed by any director and that some payments were shown as checked and approved by herself. 4. Concerning the issue of commission, counsel submitted that the claimant never produced any evidence to support this claim. The same contention went for the claim for repayment of loans advanced to the respondent by the claimant. The claimant did not provide evidence such loan being advanced to the respondent. **DETERMINATION** 1. This matter presents itself as an unfortunate situation where family members have taken each other to court over an employment dispute that could have been resolved amicably between the parties. But that having been said, our court system is adversarial and it is a cardinal rule of evidence that any person who desires that a court of law makes a finding in his favour over any allegations presented to the court for a adjudication and a finding thereon, has the obligation to prove the same to the required standard of proof. As rightly submitted by the counsel for the respondent Mr. Mbuta, it is a settled principle of law that entitlement to a relief does not merely arise from the allegations alone but must be founded on clear pleadings and cogent evidence. 2. In her statement of claim, the claimant sought a raft of remedies including the following:- 1. Service pay for twenty two years totaling to Kshs. 1,885,442/- 2. Unpaid leave for 22 years totaling to Kshs. 3, 268,100/- 3. Salary arrears for the month of March at Kshs. 28,891/- 4. Commission at Kshs. 900,000/- 5. Balance of loans Kshs. 187,000/- However, in her testimony before the court she admitted that the respondent used to deduct and remit NSSF deductions and that she could not go on leave because her work was involving and it was a family business and could even work from home when on maternity leave. The Court further notes that despite the claimant fronting a claim for salary arrears, she conceded that she did not have any evidence to support the claim that her salary was Kshs. 148,550/- per month. The same goes for the claim for commission and loan to the respondent. That is to say, the claimant did not present any evidence or any agreement for payment of commission and further the fact that the claimant could loan the respondent money which in any event was not proved, confirmed that this was a close family business which the strict rigours of law generally, let alone employment law, could not be applied without yielding undesirable consequences. 1. Similarly, the respondent apart from throwing to the court a counterclaim, did not present any evidence to support the same. The defenses raised by the respondent were totally unnecessary in the context of the fact that the claimant resigned and was not terminated from service. Further, the respondent’s witness herself conceded that they did not provide any evidence in support of the claim that the plots in Utange, Mombasa and the houses in Green 2 Estate South C were in the name of the claimant’s husband and the conditions upon which they were transferred if at all, in the claimant’s husband’s name, to entitle the respondent to claim them back. Besides, the claimant’s husband was not a party to this suit to be heard before the court makes an order with such adverse implications against him. 2. This court has said enough and need not say any more to persuade any judicious mind that the claim, defence and counterclaim before the court were uncalled for and frivolous. It is the court’s honest view that this was an internal family dispute that could have been resolved between the protagonists without letting itself play before the court. 3. **In conclusion the claim and counterclaim herein are found incompetent to warrant any judicial pronouncement thereon and are hereby dismissed with no order as to costs.** 4. **It is so ordered.** **Dated at Nairobi this 2nd of July, 2026** **Delivered virtually this 2nd day of July, 2026** **Abuodha Nelson Jorum** **Presiding Judge-Appeals Division.**