https://new.kenyalaw.org/akn/ke/judgment/keelrc/2026/1342

**REPUBLIC OF KENYA** **IN THE EMPLOYMENT AND LABOUR RELATIONS COURT AT NYERI** **ELRC APPEAL NO. E011 OF 2025** **BETWEEN** **JOHN WACHIRA NYAMU……………………………………….APPELLANT** **AND** **SINOHYDRO CORPORATION LTD...................................1ST RESPONDENT** **STECOL LIMITED………………………………………….2ND RESPONDENT** (Being an Appeal from the Judgment and decree of Hon. Ms. C.K Obara, Senior Principal Magistrate, in Nyeri law courts on 17th April 2025) **JUDGMENT** 1. The Appellant instituted proceedings before the Chief Magistrate’s Court at Nyeri in *CMELRC Cause No. E097 of 2023, John Wachira Nyamu vs Sinohydro Corporation Limited and Stecol Corporation Limited*, asserting that on or about September 2017, he was employed by the Respondents as a mechanic. The Appellant averred that he diligently discharged his duties in accordance with the terms of his employment and served the Respondents faithfully and to their satisfaction. 2. The Appellant further averred that his employment was unlawfully and unfairly terminated on 12th June 2023. In particular, he contended that he was neither informed of the reasons for the termination nor subjected to any disciplinary process, and that he was denied an opportunity to respond to the allegations that formed the basis of the termination of his employment. 3. The Appellant further asserted that throughout the subsistence of his employment, he was not granted annual leave nor compensated in lieu thereof. He also contended that he was not paid house allowance and that, upon termination of his employment, the Respondents failed to settle his terminal dues. 4. It is on the basis of the foregoing that the Appellant sought an award of Kshs 966,009.00 comprising compensation for unfair termination, accrued leave pay, house allowance, and one (1) month’s salary instead of notice. He further sought an order for the issuance of a certificate of service together with costs of the suit and interest thereon. 5. In response to the Claim, the Respondents denied the Appellant’s assertions as set forth in the Memorandum of Claim and contended that the Appellant failed to perform his duties diligently, resulting in the termination of his employment. According to the Respondents, the Appellant’s employment was terminated for gross misconduct arising from theft of its property. 6. The Respondents further contended that all dues payable to the Appellant were duly settled and that his claim in that regard was untenable. Consequently, the Respondents urged the trial Court to dismiss the Appellant’s Claim with costs. 7. At the hearing before the trial Court, the Appellant testified in support of his case, while the Respondents elected not to call oral evidence. Upon close of the hearing, the parties filed written submissions, following which the learned trial Magistrate delivered judgment in favour of the Respondents. 8. In her judgment, the learned trial Magistrate held that the Appellant had failed to prove his case, having not produced a letter of appointment or written contract demonstrating continuous employment with the Respondents. On that basis, the trial Court concluded that the issue of unfair termination did not arise and consequently dismissed the Appellant’s claim with costs to the Respondents. **The Appeal** 1. Aggrieved by the said determination, the Appellant preferred the present Appeal and set forth the following four (4) grounds in support thereof: 2. ***THAT the learned Magistrate erred in law and fact by shifting the burden of proof to the Appellant despite the Appellant having proved his case on a balance of probabilities.*** 3. ***THAT the learned Magistrate erred in law and fact in finding that the appellant was a casual labourer therefore, the issue of unfair termination did not arise.*** 4. ***THAT the learned Magistrate erred in law and fact in finding that the Appellant did not prove that he worked continuously for the Respondent despite him tendering evidence to prove continuous employment with the Respondents.*** 5. ***THAT the learned Magistrate showed extreme prejudice by ignoring the submissions of the Appellant’s advocates on issues of law and fact thereby arrived at an erroneous decision.*** 6. Consequently, the Appellant seeks the following orders from this Court: 7. ***THAT the Appellant’s Appeal be allowed with costs.*** 8. ***THAT the judgment and decree of the lower Court be set aside and substituted with an award of Kshs 595,089/- to the Appellant for wrongful, unfair and unlawful termination of his employment.*** **The Submissions** 1. The Appeal was canvassed by way of written submissions. Both parties filed their respective submissions, which the Court has duly considered. 2. On behalf of the Appellant, it was submitted that the existence of an employment relationship between the parties was not disputed, as was evident from the pleadings filed before the trial Court. In that regard, the Appellant contended that the learned trial Magistrate erred by venturing beyond the parties’ pleadings in determining the nature of his employment. The Appellant further argued that, since neither party had pleaded or denied casual employment, the trial Court’s analysis on that issue was misplaced and irrelevant. 3. Relying on the decision in ***Daniel Otieno Migore v South Nyanza Sugar Co. Ltd [2018],*** the Appellant submitted that parties are bound by their pleadings and that the issue of casual employment, not having been pleaded or proved during the trial, did not warrant the detailed consideration accorded to it by the trial Court. 4. The Appellant further submitted that the learned trial Magistrate erred in framing the issues for determination around the question of casual employment and in proceeding to analyse the same contrary to the pleadings filed by the parties. In support of this contention, reliance was also placed on the case of ***Dogra International Limited v Wanekaya [2025] KEELRC 212 (KLR).*** 5. The Appellant further submitted that the absence of bank records showing regular payments did not necessarily negate the existence of an employment relationship, as payment could have been made through alternative means. He argued that there was no evidence before the trial Court, either in the pleadings or otherwise, demonstrating that salary payments were exclusively made through his bank account. To this end, the Appellant posited that he had sufficiently discharged the burden of proof placed upon him. 6. On their part, the Respondents submitted that the Appellant failed to produce any contract of employment demonstrating that he was indeed their employee or setting out the terms of his engagement, if any. According to the Respondents, the only document produced by the Appellant in support of his claim was a bank statement, which he alleged proved the existence of employment. 7. The Respondents further contended that the said bank statements revealed that the payments made by them were neither regular nor consistent in amount, thereby negating the existence of continuous employment. On this score, the Respondents submitted that, in the absence of a contract or other documentary proof of continuous engagement, the Appellant failed to establish that he was their employee. 8. The Respondents further argued that had the Appellant been in continuous employment, the payments reflected in the bank statements would have been regular and consistent. 9. Accordingly, it was the Respondents’ position that the Appellant was a casual labourer and was never engaged in continuous or permanent employment. **Analysis and Determination** 1. As a first appellate Court, this Court is enjoined to re-examine and re-evaluate the evidence on record, together with the Judgment, and to arrive at its own independent conclusion. In this regard, the Court ought to be cognizant that it did not have the advantage of observing and hearing the witnesses testify firsthand. This duty was reaffirmed in ***Abok James Odera t/a A.J Odera & Associates vs John Patrick Machira t/a Machira & Co. Advocates******[2013] eKLR***, as follows: ***“This being a first appeal, we are reminded of our primary role as a first appellate court namely, to re-evaluate, re-assess and reanalyze the extracts on the record and then determine whether the conclusions reached by the learned trial Judge are to stand or not and give reasons either way.”*** 1. Bearing in mind the duty of this Court at this appellate stage, and having considered the Memorandum of Appeal, the record of appeal in its entirety, together with the respective submissions of the parties, the following issues emerge for determination: 2. ***Whether the trial Court erred in finding that the Appellant was a casual employee on the basis that he had failed to demonstrate continuous employment with the Respondents;*** 3. ***Depending on the finding in (a), whether the termination of the Appellant’s employment was unfair and unlawful;*** 4. ***Depending on the finding in (b), whether the Appellant is entitled to the remedies sought before the trial Court.*** **Whether the trial Court erred in finding that the Appellant was a casual employee on the basis that he had failed to demonstrate continuous employment with the Respondents** 1. The Appellant has taken issue with the trial Court’s finding that he was a casual labourer and that he failed to demonstrate continuous employment with the Respondents. 2. In her judgment, the learned trial Magistrate held that the Appellant failed to produce a contract of service or letter of appointment evidencing continuous employment with the Respondents. On that basis, the learned Magistrate concluded that the Appellant’s assertion that he had been in continuous employment for a period of over five (5) years and nine (9) months was far from the truth. 3. It is noteworthy that in their Response to the Claim, the Respondents did not expressly plead, assert, or even suggest that the Appellant was engaged on casual terms or that his employment was intermittent in nature. 4. From the record, the issue relating to the nature of the Appellant’s employment only arose during his cross-examination and in the submissions. 5. It is trite that parties are bound by their pleadings. Accordingly, the Respondents’ subsequent submissions that the Appellant was engaged on a casual basis appear to be an afterthought, having not been pleaded at the outset. 6. Further to the foregoing, the Respondents were required, pursuant to **Section 10(7) of the Employment Act**, to discharge the burden of proving their assertion that the Appellant was engaged on casual terms. The said provision is couched as follows: ***(7) If in any legal proceedings an employer fails to produce a written contract or the written particulars prescribed in subsection (1), the burden of proving or disproving an alleged term of employment stipulated in the contract shall be on the employer.*** 1. It is noteworthy that the Respondents did not adduce any evidence before the trial Court, notwithstanding their statutory obligation as custodians of employment records. 2. In light of **Section 10(7) of the Employment Act**, the burden of proving the terms and nature of the Appellant’s employment lay squarely upon the Respondents. It is therefore unclear why they failed to produce any documentary or other evidence to substantiate their assertion that the Appellant’s engagement was intermittent and purely casual in nature. 3. This Court is guided by, and fully concurs with, the holding of the Court of Appeal in ***Jackson Muiruri Wathigo t/a Murtown Supermarket v Lilian Mutune [2021] eKLR,*** where it was stated as follows: - ***“[15]. In any event, as per the respondent, the burden lay with the appellant by virtue of*Section 10(7)*of the Employment Act to establish the terms of her employment. His failure to render any employment record meant that the appellant had not established his allegations that she was a casual employee. Besides, the respondent submitted that having worked for the appellant from August, 2010 until November, 2013, the appellant was estopped by*Section 37*of the Employment Act******from claiming that she was a casual employee.”*** 1. In view of the Respondents’ failure to discharge the evidential burden placed upon them, this Court finds that the assertion that the Appellant was engaged on a casual basis was not supported by any evidence. 2. Accordingly, this Court finds that the learned trial Magistrate erred in finding that the Appellant was a casual employee and in concluding that he had failed to prove continuous employment with the Respondents. 3. Having so determined, I now proceed to consider whether the termination of the Appellant’s employment was unfair and unlawful. **Unfair and unlawful termination of employment?** 1. As stated herein, the Respondents pleaded that the Appellant’s employment was terminated on account of gross misconduct, specifically, theft of its property. 2. Under **Sections 43 and 45(2) of the Employment Act,** the Respondents were required to demonstrate the reasons for the termination of the Appellant’s employment and to show that the termination was effected in accordance with a fair procedure. 3. In particular, **Section 45(2)(a) and (b) of the Employment Act** requires an employer to prove that the reason for termination was valid and fair, and that it related to the employee’s conduct, capacity, compatibility, or its operational requirements. 4. Given that the Respondents did not adduce any evidence at the trial Court, it follows that they failed to discharge the evidentiary burden of demonstrating that the termination of the Appellant’s employment was for a valid and fair reason and was related to his conduct. 5. Accordingly, the Respondents’ assertion that the Appellant was terminated for cause remains unsubstantiated. Indeed, the property alleged to have been stolen by the Appellant was not particularised in the Response to the Claim. 6. With respect to procedural fairness, the Respondents did not indicate, let alone suggest, that the Appellant was notified of the allegations against him in advance, informed that termination was being contemplated on the basis of the said allegations, or afforded an opportunity to be heard in the presence of a fellow employee or union representative of his choice. 7. In the circumstances, it becomes apparent that the termination of the Appellant’s employment did not comply with the procedural safeguards set out under **Section 41 of the Employment Act.** 8. In light of the foregoing, this Court reaches the inescapable conclusion that the termination of the Appellant’s employment was both unfair and unlawful. **Remedies?** 1. Having found that the termination of the Appellant’s employment was unfair and unlawful, this Court awards him one (1) month’s salary in lieu of notice together with compensation equivalent to four (4) months’ gross salary. In arriving at this award, the Court has taken into account the length of the employment relationship, as well as the Respondents’ failure to demonstrate that there existed a valid and fair reason for terminating the Appellant’s employment and that due procedural fairness was observed prior to the said termination. 2. With respect to the claim for annual leave, the Appellant seeks the sum of Kshs 45,137.00. The Respondents were under a statutory obligation to maintain leave records pursuant to **Section 74(1)(f) of the Employment Act.** Notwithstanding this duty, they failed to produce any leave records to enable the Court ascertain the leave days taken during the subsistence of employment and any outstanding balance as at the date of termination. Be that as it may, under **Section 28(4) of the Employment Act,** the Appellant is only entitled to claim unpaid annual leave for the eighteen (18) months immediately preceding the date of termination. 3. The Appellant also contends that he was not paid house allowance during the course of his employment with the Respondents. From the record, it is evident that the Appellant was remunerated through bank transfers, and no pay slips were produced to demonstrate a breakdown of his salary. In the absence of such documentary evidence, it is unclear how the Appellant arrived at the conclusion that house allowance was not paid. What’s more, there is no assertion that the Appellant’s remuneration fell below the applicable Minimum Wage Order for employees in his category. In the circumstances, it is presumed that any house allowance was subsumed within his gross salary. Accordingly, the claim for house allowance is declined. **Orders** 1. In the final analysis, the Court allows the Appeal and makes the following orders:- 2. **The order of the trial Court dismissing the Appellant’s Claim is hereby set aside.** 3. **The Appellant is awarded one (1) month’s salary in lieu of notice in the sum of Kshs 35,978.00.** 4. **The Appellant is further awarded compensation for unfair termination equivalent to four (4) months’ salary, amounting to Kshs 143,912.00.** 5. **The Appellant is awarded unpaid leave for a period of eighteen (18) months in the sum of Kshs 37,776.90.** 6. **The total award therefore amounts to Kshs 217,666.90.** 7. **Interest on the sum in (e) shall accrue at court rates from the date of this Judgment until payment in full.** 8. **The Respondents shall issue the Appellant with a certificate of service within thirty (30) days from the date of this Judgment.** 9. The costs in this Court and at the trial Court shall be borne by the Respondents. **DATED, SIGNED** and **DELIVERED** at **NYERI** this **15th** day of **May 2026.** ……………………………… **STELLA RUTTO** **JUDGE** **In the presence of**: For the Appellant Mr. Mwalagho For the Respondent Mr. Maringa Court Assistant Ndati **ORDER** In view of the declaration of measures restricting Court operations due to the COVID-19 pandemic and in light of the directions issued by His Lordship, the Chief Justice on 15th March 2020 and subsequent direction of 21st April 2020 that judgments and rulings shall be delivered through video conferencing or via email. They have waived compliance with **Order 21 Rule 1** of **the Civil Procedure Rules**, which requires that all judgments and rulings be pronounced in open Court. In permitting this course, this Court had been guided by Article 159(2)(d) of the Constitution which requires the Court to eschew undue technicalities in delivering justice, the right of access to justice guaranteed to every person under Article 48 of the Constitution and the provisions of **Section 1B** of the **Civil Procedure Act (Chapter 21 of the Laws of Kenya)** which impose on this Court the duty of the Court, inter alia, to use suitable technology to enhance the overriding objective which is to facilitate just, expeditious, proportionate and affordable resolution of civil disputes. **STELLA RUTTO** **JUDGE**