[2018] KEELRC 2445 (KLR)

REPUBLIC OF KENYA

IN THE EMPLOYMENT AND LABOUR RELATIONS COURT AT NAIROBI

CAUSE NO 2087 OF 2015

CONSOLIDATED WITH

CAUSE NO 2089 OF 2015

JAMES MBURU CHEGE........................1STCLAIMANT

JOSEPH NJAGI MUGO........................2NDCLAIMANT

VERSUS

KENYACAM LIMITED......................1STRESPONDENT

CAMUSAT KENYA LIMITED...........2NDRESPONDENT

JUDGMENT

Introduction

1. This consolidated claim is brought by James Mburu Chege and Joseph Njagi Mugo against Kenyacam Limited and Camusat Kenya Limited. The claim is contained in Statements of Claim dated 24th November 2015 and filed in court on 25th November 2015. The Respondents filed their responses on 1st March 2016.

2. By consent of the parties, the matter proceeded by way of written submissions.

The Claimants’ Case

3. The 1st Claimant, James Mburu Chege states that he was employed by the 1st Respondent as a Rigger on 28th July 2011. He earned a monthly salary of Kshs. 29,000, exclusive of house allowance and was confirmed upon expiry of a three (3) months’ probation period.

4. The 1st Claimant states that the 1st Respondent refused to pay him house allowance. He further states that between September 2012 and March 2013, he was forced to do construction work, which was not part of his duties under his employment contract. The 1st Respondent refused to compensate the 1st Claimant for the extra services offered. In addition, the 1st Claimant worked from Monday to Sunday without any overtime compensation.

5. The 1st Claimant further states that in the month of May 2013, the 1st Respondent entered into an agreement with Wananchi Group Limited involving inter alia construction, maintenance, installation and support.

6. The 1st Claimant pleads that the 1st Respondent unilaterally reviewed his contract, assigning him the position of Field Technician at a gross salary of Kshs. 28,528 plus a daily allowance of Kshs. 200 for food and transport. The 1st Claimant was also to be paid Kshs. 2,000 for days spent outside Nairobi.

He avers that the 1st Respondent took him for training at the Kenya Power but withheld his training certificate.

7. The 1st Claimant alleges that the 1st Respondent later merged with Wananchi Group and changed its name to Camusat Kenya Limited, the 2nd Respondent herein. The 1st Claimant states that after the merger, he was not issued with a new contract of employment. The Respondents continuously made him switch jobs without any formal training and without compensation. The 1st Claimant’s salary was later increased to Kshs. 33,000 plus a transport allowance of Kshs. 6,000 per month.

8. Sometime in September 2015, the 1st Claimant was on his way to work when he received a text message from the Respondents asking him to go for a meeting at the Respondents’ Head Office on 1st October 2015. When the 1st Claimant went for the meeting as instructed, he was issued with a termination letter backdated to 30th September 2015. He was also issued with a pay slip showing that he had been paid a total sum of Kshs. 116,286. 86, yet he only received Kshs. 33,000.

9. It is the 1st Claimant’s case that the termination of his employment was actuated by malice and was in breach of the Respondents’ statutory duty.

He now claims the following:

a) 1 months’ salary in lieu of notice.......................................Kshs. 33,000. 00

b) House allowance.......................................................................221,850. 00

c) Overtime (normal days)............................................................586,061. 28

d) Overtime (rest days-Sundays)...................................................427,671. 20

e) Service pay.................................................................................. 33,000. 00

f) 12 months’ salary in compensation..........................................396,000. 00

g. Certificate of service

h. Costs plus interest

10. The 2nd Respondent, Joseph Njagi Mugo states that he was employed by the 1st Respondent as a Rigger on 30th May 2011. He earned a monthly salary of Kshs. 34,000 exclusive of house allowance and was confirmed upon expiry of a three (3) months’ probation peri

11. The 2nd Claimant states that the 1st Respondent refused to pay him house allowance. He further states that between September 2012 and March 2013, he was forced to do construction work, which was not part of his duties

under his employment contract. The 1st Respondent refused to compensate the 2nd Claimant for the extra services offered. In addition, the 2nd Claimant worked from Monday to Sunday without any overtime compensation.

12. The 2nd Claimant further states that in the month of May 2013, the 1st Respondent entered into an agreement with Wananchi Group Limited involving inter alia construction, maintenance, installation and support. The 2nd Claimant states that the 1st Respondent unilaterally reviewed his contract, assigning him the position of Field Technician at a gross salary of Kshs. 32,129 plus a daily allowance of Kshs. 200 for food and transport. The 2nd Claimant was also to be paid Kshs. 2,000 for days spent outside Nairobi. He avers that the 1st Respondent took him for training at the Kenya Power but withheld his training certificate.

13. The 2nd Claimant alleges that the 1st Respondent later merged with Wananchi Group and changed its name to Camusat Kenya Limited, the 2nd Respondent herein. The 2nd Claimant states that after the merger, he was not issued with a new contract of employment. The Respondents continuously made him switch jobs without any formal training and without compensation. The 2nd

Claimant’s salary was later increased to Kshs. 40,000 plus a transport allowance of Kshs. 6,000 per month.

14. Sometime in September 2015, the 2nd Claimant was on his way to work when he received a text message from the Respondents asking him to go for a meeting at the Respondents’ Head Office on 1st October 2015. When the 2nd Claimant went for the meeting as instructed, he was issued with a termination letter backdated to 30th September 2015. He was also issued with a pay slip showing that he had been paid a total sum of Kshs. 150,476. 86, yet he only received Kshs. 40,000.

15. It is the 2nd Claimant’s case that the termination of his employment was actuated by malice and was in breach of the Respondents’ statutory duty. He now claims the following:

a) 1 months’ salary in lieu of notice.......................................Kshs. 40,000. 00

b) House allowance.......................................................................270,000. 00

c) Overtime (normal days)............................................................656,287. 20

d) Overtime (rest days-Sundays)...................................................490,775. 12

e) 12 months’ salary in compensation..........................................480,000. 00

f) Certificate of service

g) Costs plus interest

The Respondents’ Case

16. In their responses dated 26th February 2016 and filed in court on 1st March 2016, the Respondents state that on 27th November 2014, the 1st Respondent filed a Change of Name under the Companies Act to Camusat Kenya Limited. The 1st and 2nd Respondents therefore refer to the same person. The 1st Respondent denies merging with Wananchi Group.

17. The Respondents admit that the 1st Claimant was employed as a Rigger at a gross monthly salary of Kshs. 15,000 from 28th June 2011, subject to a three (3) months’ probation period. On 1st May 2013, the 1st Claimant’s contract was reviewed under the following terms:

a. The 1st Claimant was employed as a Field Technician;

b. He earned a gross monthly salary of Kshs. 28,528;

c. He would work on weekdays from 8. 00 am to 5. 00 pm.

18. The Respondents deny ordering, forcing or compelling the 1st Claimant to carry out construction work, installation or driving without prior formal training or pay. They further deny the averment that the 1st Claimant worked from Monday to Sunday without overtime compensation and reiterate that the 1st Claimant only worked on weekdays and in the event that he worked on Saturday and Sunday, he would be entitled to an extra rest day. The Respondents deny any illegal actions in the review of the 1st Claimant’s employment contract.

19. The Respondents state that on 1st September 2015, the 2nd Respondent issued a performance notice to the 1st Claimant, outlining performance quotas and parameters for review within a period of 30 days. On 30th September 2015, the Respondents held a performance review meeting with the 1st Claimant. The 1st Claimant’s performance was found unsatisfactory against the parameters set out in the performance notice. The 1st Claimant was therefore issued with a termination letter.

20. Regarding the 1st Claimant’s terminal dues, the Respondents aver that he was paid the sum of Kshs. 84,473 net of statutory deductions. The said sum was paid in two (2) installments of Kshs. 26,585 paid on 30th September 2015 and Kshs. 57,888 paid on 2nd November 2015. On the claim for house allowance, the Respondents state that the 1st Claimant was paid a consolidated monthly salary, inclusive of house allowance.

21. In response to the 2nd Claimant’s claim, the Respondents state that he was employed as a Rigger at a gross monthly salary of Kshs. 20,000 from 30th May 2011, subject to a three (3) months’ probation period. The 2nd Claimant’s contract was subsequently reviewed under the following terms:

a. The 2nd Claimant was employed as a Field Technician;

b. He earned a gross monthly salary of Kshs. 35,129;

c. He would work on weekdays from 8. 00 am to 5. 00 pm.

22. The Respondents deny ordering, forcing or compelling the 2nd Claimant to carry out construction work, installation or driving without prior formal training or pay. They further deny the averment that the 2nd Claimant worked from Monday to Sunday without overtime compensation and reiterate that the 2nd Claimant only worked on weekdays and in the event that he worked on Saturday and Sunday, he would be entitled to an extra rest day. The Respondents deny any illegal actions in the review of the 2nd Claimant’s employment contract.

23. The Respondents state that on 1st September 2015, the 2nd Respondent issued a performance notice to the 2nd Claimant, outlining performance quotas and parameters for review within a period of 30 days. On 30th September 2015, the Respondents held a performance review meeting with the 2nd Claimant. The 2nd Claimant’s performance was found unsatisfactory against the parameters set out in the performance notice. The 2nd Claimant was therefore issued with a termination letter.

24. Regarding the 2nd Claimant’s terminal dues, the Respondents aver that he was paid the sum of Kshs. 108,161 net of statutory deductions. The said sum was paid in two (2) installments of Kshs. 31,473 paid on 30th September 2015 and Kshs. 76,688 paid on 2nd November 2015. On the claim for house allowance, the Respondents state that the 2nd Claimant was paid a consolidated monthly salary, inclusive of house allowance.

25. The Respondents maintain that the termination of the Claimants’ employment was fair and proper.

Findings and Determination

26. There are two (2) issues for determination in this case:

a. Whether the termination of the Claimants’ employment was lawful and fair;

b. Whether the Claimants are entitled to the remedies sought.

The Termination

27. The termination of the Claimants’ employment was effected by individual letters dated 30th September 2015, stating as follows:

“RE: TERMINATION OF EMPLOYMENT CONTRACT

We regret to inform you that your employment contract with Camusat Kenya Ltd has been terminated with immediate effect. This decision has been reached as a result of negligence and unsatisfactory work performance which is a breach of the company’s standard requirements.

You will be entitled to a Month’s pay in lieu of notice, accumulated leave and other allowances entitled to you. We will disburse your final dues as soon as you hand over any company property currently in your possession. Kindly make arrangements to clear with the company accordingly.

We thank you for your service to Camusat Kenya Ltd and wish you all the best in your future endeavours.

Respectfully,

(Signed)

FRANCIS MACHARIA

HR MANAGER”

28. According to these letters, the termination of the Claimants’ employment was caused by poor performance, which is one of the grounds for which an employer may terminate the employment of an employee.

29. Jurisprudence emerging from this Court is to the effect that the procedural fairness requirements set out under Section 41 of the Employment Act, 2007 are fully applicable to cases of poor performance. In Kenya Science ResearchInternational Technical and Allied Workers Union (KSRITAWU) v Stanley Kinyanjui and Magnate Ventures Ltd (Cause No 273 of 2010),Rika Jheld that once poor performance of an employee is noted, the proper procedure is to point out the shortcomings to the employee and allow them reasonable time to improve.

30. Prior to the termination letters, the Claimants had been issued with performance notices on 1st September 2015, citing the following as expectations:

a. Serving with commitment and completing the jobs within SLA;

b. Providing lasting solution to the network on both proactive and preventive maintenance;

c. Accountability of materials and usage of the required materials at the right stage for the right ticket, according to the process;

d. Adhering to the planned timetable and permanent communication with dispatchers. Information to transmit are, but are not limited to, arrival time on site, nature of the fault, expected time to repair, material used, test result after completion;

e. Continuous excellence performance on troubleshooting method for both GPON and HFC network.

31. In my view, the foregoing is a list of general statements and aspirations. They do not qualify as either shortcomings or targets against which the Claimants’ performance could be gauged. The performance notices issued to the Claimants indicated that a review would be undertaken at the end of September 2015. In their supplementary list of documents the Respondents produced minutes of a performance review meeting held on 30th September 2015, the same day when the Claimants’ employment was terminated. From this record, the Court did not see evidence of participation by the Claimants in the subject performance review, either by making comments or by appending their signatures. In Jane Wairimu Machira v Mugo Waweru and Associates [2012] eKLRthis Court held that an appraisal of the performance of an employee must involve the active participation of the employee.

32. Moreover, in light of the proximity in time between the performance review meeting and the termination of the Claimants’ employment, the Court was unable to find a distinction between the performance review meeting and the disciplinary hearing leading to the termination of the Claimants’ employment.

33. Overall, I find and hold that the termination of the Claimants’ employment on account of poor performance was unjustifiable and unprocedural and they are entitled to compensation.

Remedies

34. Flowing from the foregoing, I award each of the Claimants eight (8) months’ salary in compensation. In arriving at this award, I have considered the Claimants’ length of service and the Respondents’ conduct prior to the termination.

35. The Claimants also claim house allowance. Section 31(1) & (2) of the Employment Act provides that:

1. An employer shall at all times, at his own expense, provide reasonable housing accommodation to each of his employees either at or near to the place of employment or shall paytothe employee such sufficient sum, as rent, in addition to the wages or salary of the employee, as will enable the employee to obtain reasonable accommodation.

2. This sectionshall not apply to an employee whose contract of service-

a. contains a provision which consolidates as part of the basic wage or salary of the employee, an element intended to be used by the employee as rent or which is otherwise intended to enable the employee to provide himself with housing accommodation; or

b. is the subject matter of or is otherwise covered by a collective agreement which provides consolidation of wages as provided in paragraph (a).

36. The Claimants’ employment contracts as reviewed on 1st May 2013 provided for gross monthly salaries, which would ordinarily be inclusive of house allowance. In their Statements of Claim, the Claimants allege that the Respondents did not consult them before reviewing their contracts. There was however no evidence that the Claimants had made any objection prior to filing of this case.

37. In the circumstances, the Court reached the conclusion that the Claimants were fully aware and had acceded to consolidated gross salaries, inclusive of house allowance. The claims for house allowance are therefore without merit and are dismissed.

38. From the evidence on record, the Claimants were paid notice and service pay. These claims are therefore without basis and are dismissed. The claims for overtime compensation were not proved and therefore fail and are dismissed.

39. In the end, I enter judgment in favour of the Claimants in the sums of Kshs. 264,000 for the 1st Claimant, James Mburu Chege and Kshs. 320,000 for the 2nd Claimant, Joseph Njagi Mugo, being eight (8) months’ salary for unlawful and unfair termination of employment.

40. These amounts will attract interest at court rates from the date of delivery of this judgment until payment in full.

41. The Claimants are also entitled to certificates of service and the costs of the case.

42. It is so ordered.

DATED AND SIGNED AT NAIROBI THIS 4THDAY OF JANUARY 2018

LINNET NDOLO

JUDGE

DELIVERED IN OPEN COURT AT NAIROBI THIS 16THDAY OF FEBRUARY, 2018

MAUREEN ONYANGO

JUDGE

Appearance:

Mr. Gomba for the Claimants

Mr. Odhiambo for the Respondents