https://new.kenyalaw.org/akn/ke/judgment/keelrc/2026/1321

Kenya Union of Domestic, Hotels Educational Institutions and Hospital Workers v Murarandia Provision Store/Agencies t/s Njuguna’s Palace & another (Cause E006 of 2024) [2026] KEELRC 1321 (KLR) (20 May 2026) (Judgment) Neutral citation: [2026] KEELRC 1321 (KLR) Republic of Kenya In the Employment and Labour Relations Court at Nairobi Cause E006 of 2024 ON Makau, J May 20, 2026 Between Kenya Union of Domestic, Hotels Educational Institutions and Hospital Workers Claimant and Murarandia Provision Store/Agencies t/s Njuguna’s Palace 1st Respondent Robert Macharia Njuguna 2nd Respondent Judgment Introduction 1.The Claimant is a trade union suing on behalf of its 7 members herein called the grievants. The 1st Respondent is a Food and Beverage outlet while the 2nd Respondent is its proprietor and manager. 2.By a Memorandum of Claim dated 5th January 2024 the Claimant alleged that the grievants were employed by the Respondents on diverse dates between 5th May 2007 and 5th January 2021 and worked continuously until February 2023 when their employment was unfairly terminated by the Respondent. The Claimant prayed for the following reliefs:-a.That the Honourable court be pleased to declare that the grievant was constructively terminated by the Respondent.b.That the Honourable court be pleased to issue and order the Respondent to pay to the grievant Kshs. 3,896,802.00.c.That the Honourable court be pleased to issue an order directing the Respondent to issue a letter and or certificate of service to the grievants.d.That the Honourable do compensate the grievant 12 Months salary for unlawful termination on account of constructive termination as provided for under section 49 of Employment Act 2007.e.That the Respondents to meet the interest at court rate.f.That the court to grant any other orders it deems just. 3.The Respondents filed a Joint Response dated 26th February 2024 through Matiba SK Mukundi & Company Advocates. They denied ever employing the grievants on permanent basis and averred that the grievants were casual workers employed intermittently on need basis. Therefore they denied the alleged unfair termination of the grievants employment and prayed for the entire suit to be dismissed with costs. Evidence 4.The Claimant called the 6th grievant, Mr. Charles Munyaka Wambugu who testified as CW1. He testified on behalf of all the grievants. He adopted his written statement dated 22nd January 2025 and produced a bundle of documents as exhibits. 5.In brief, he stated that he was employed by the 1st Respondent on 28th January 2005 as a waiter for gross monthly salary of Kshs. 4000. After two years he was promoted to Barman and his salary increased to Kshs. 6000. From 2007, due to his honest and trust he was assigned other duties of going to the bank to pay for electricity bills, water bills and licences. In 2010, he was further promoted to a supervisor over a group of 14 employees. He was also responsible of the business when the 2nd Respondent was away. He was also mandated to represent his boss in all meetings. 6.In 2015, they were issued with forms to sign before salary. The filled the forms and the employer retained them. He contended that there were more than 30 employees and some exited leaving 22 working during Covid-19 period. They continued working until 28th January 2023 when the Respondent sent them away promising to call them back after three months but they were never called back. 7.He contended that they were not paid anything else except salary after the separation. He further contended that the employer never remitted National Social Security Fund and it underpaid them during the period they worked. The also worked during public holidays and weekends which were the peak of their work but they were never compensated. 8.On cross examination, he stated that he was employed by the Respondent together with the other grievants. He contended that he was employed on 5th May 2007 but admitted that he did not filed a contract of employment. He contended that the one he signed was retained by employer. However be contended that the medical certificate he produced as evidence was proof that he was employed by the Respondent. He contended that he worked for 17 years. 9.He reiterated that he took no leave and no statutory deductions were made. He further stated that he joined the Claimant union while still in employment. He contended that he was paid three months salary as stated in his written statement. The employer never paid him and his colleagues. 10.He confirmed that the medical certificates he produced were issued On 22nd March 2022 and they were valid for six months. He contended that the certificate were paid for by the employer and the working environment was good. He contended that there was work all through and they worked continuously contrary to the Respondent’s allegation. 11.He contended that the employer has the responsibility to issue a contract to the employee. He clarified that, although payment for medical certificate came from the employer the receipts were issued in the name of the employee. 12.The 2nd Respondent testified as RW1. He admitted that he runs the 1st Respondent restaurant. He adopted his written statement dated 24th February 2025 as his evidence in chief and produced a letter dated 30th August 2023 as an exhibits. 13.In brief, his evidence was that the grievants were casual employees who were called to assist in various roles when hotel was busy especially on weekends. He contended that from the beginning of 2023, the 1st Respondent no longer required the services of the grievants and as such they called to render any services. 14.He contended the medical certificates produced by the grievants was not proof of permanent employment contending that it was a requirement for all the employees whether casual or permanent. He further stated that as casual employees, the grievants were not entitled to house allowance or subject to statutory deductions. 15.He contended that they were paid on daily basis at the end of their shift and as such the law does not require service of any notice before termination. Therefore he denied the alleged unfair termination and the reliefs sought. 16.On cross examination, he contended that he started operating the restaurant two years ago but before then he was employed by the 1st Respondent. He maintained that the grievants were doing casual work in the 1st Respondent and therefore he could not produce records of employment for them because they were attending work intermittently. 17.He denied having paid for the grievant’s medical certificates and averred that they paid for themselves in order to secure employment. He contended that the employee is required to prove medical fitness before getting the job. He admitted that the medical certificates could not be issued in any other restaurant. He also admitted that there are no medical certificates for less than six months but reiterated that the grievants were only employed for few days. He admitted that the restaurant operated daily and there was work every day. 18.He re examination he reiterated that the grievants worked only when there was much work especially weekends and they never complained upon being paid as casuals. Submissions 19.The Claimant submitted that there was evidence to prove that the grievants worked continuously for more than six months as casuals and as such converted to permanent employees under Regulation 18 of Regulation of Wages (Hotels and Catering Trade Wages Council) Order. The said Regulation provide that an employee on temporary or seasonal terms of employment converts to permanent employment on completion of six month’s continuous service. 20.It further submitted that the employer is responsible to draw the contract of employment and to keep records of employment by dint of section 9 and 74 of the Employment Act. It faulted RW1 for failing to produce records of employment for the grievants including payment vouchers duty registers contracts or appointment letters to disprove the alleged permanent employment. Therefore it prayed for the reliefs sought in the claim. 21.The Respondent’s, on the other hand, submitted that the Claimant did not adduce evidence to prove that the grievants worked continuously as alleged. They maintained that the grievants were engaged as casuals on need basis and therefore they never converted to permanent employees under Section 37 of the Employment act. In the circumstances the court was urged to find that the Claimant is not entitled to the prayers sought and dismiss the suit with costs. Determination 22.Having considered the pleadings, evidence and submissions, there is no dispute that the grievants worked for the Respondents as casual workers. The issues for determination are:-a.Whether the grievants continuously worked for the Respondent from May 2007 to February 2023.b.Whether their casual employment converted to regular (permanent) employment.c.Whether the employment was unfairly terminated.d.Whether they are entitled to the reliefs sought. Continuous service 23.The burden of proof of continuous service lay with the Claimant. CW1 testified that all the grievants worked continuously from 2007 even during Covid-19 period. He contended that the weekends and public holidays were the peak of the work and they were never compensated for the same. He produced medical certificates for each grievant as proof that they were employed by the Respondents. 24.The Respondents maintained that the grievants were hired intermittently on casual basis especially on weekends. They were paid on daily basis and no statutory deductions were made from their wages. RW1 confirmed that the restaurant operated daily and there was work throughout. 25.I have carefully considered the evidence presented by the two sides. There is no denial that all the seven grievants worked for the Respondents on the dates pleaded. RW1 repeated the averments in the Memorandum of Response that the grievants were casual employees and not permanent. He also corroborated the Claimant’s case that the grievants worked continuously by confirming that the restaurant operated daily. 26.The court notes that the Respondent did not adduce any records of employment for the Claimant including Attendance Registers, Payrolls or Master rolls and/or payment vouchers. The Claimant produced medical certificates for 2022 covering six months as proof that they were employed by the Respondents to work continuously. 27.Section 74 of the Employment Act mandates an employer to keep records of employment of his employees. Section 10 (7) of the Act provides that:-“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.” 28.In this case the grievants alleged that they were employed continuously and they did so for many years, but the Respondents have produced no records of their employment to disprove the alleged term of service. 29.The case of William Basil & 3 others v. Colour Print Ltd cited by the Respondents is distinguishable from the instant case because in that case the employer produced records of employment to disapprove the Claimants case. The court held:-“The Respondent has however produced Daily Casual Registers for the period between 2010 and 2012 which prove that the Claimants worked for the Respondent as casuals, that they never worked continuously for at least one month, and that that were paid daily. The burden of proving continuous service lies with the employee who alleged that he so served. In this case, however, that burden was not discharged by the inconsistent evidence tendered by the witness. Consequently, I return that the Claimant’s casual employment never converted to term contract as alleged, but it remained casual employment due to their intermittent service.” 30.Likewise the instant case is distinct from the Rashid Mazuri Ramadhan & 10 others v. Doshi Company (Hardware) Ltd & another[2018] (KLR) where the court of Appeal held:-“Looking at the above evidence we are unable to disagree with the findings of the learned Judge and indeed there is no justification for doing so as the evidence shows that the appellants were casual employees who used to work for 2 days a week depending on the availability of materials. They used to clock their time on the said days when they reported at work. The evidence by the Respondents that they used to pay daily wages as per the petty cash analysis sheets that were produced in evidence for each of the Appellants was also not challenged. So was the evidence that on 2nd August 2015 some Appellants deserted work after they were given a term contract… it therefore follows that their daily contract could not be converted into a term contract and they were not entitled to notice, leave or certificate of employment as posited by the Judge.” 31.As noted above, the employer herein has failed to produce records of employment to disprove that the grievant’s worked continuously. Instead, RW1 merely alleged that the grievants were casual employees who were engaged intermittently. Consequently, I find that the Claimant has proved on a balance of probability that the grievants worked for the Respondents, continuously during the periods pleaded. Conversion to term contract 32.The Claimant’s case is that due to continuous service, the grievants casual employment converted to regular term contract otherwise called permanent employment by didn’t of Section 37 of the Employment Act and Regulation 18 of the Regulation of Wages (Hotels and Catering Traders Wages Council) Order. Section 37 (1) provides that:-“(1)Notwithstanding any provisions of this Act, where a casual employee-a.works for a period or a number of continuous working days which amount in the aggregate to the equivalent of not less than one month orb.performs work which cannot reasonably be expected to be completed within a period, or a number of working days amounting in the aggregated to the equivalent of three months or more,The contract of service of the casual employee shall be deemed to be one where waged are paid monthly and section 35(1)(c) shall apply to that contract of service.” 33.Regulation 18 provides that:-“(1)No person shall be employed on temporary or seasonal terms of employment for a period exceeding six months.(2)An employee on temporary or seasonal terms of employment shall be deemed to have been converted to regular terms of employment on completion of six months continuous service.” 34.I have already made a finding of fact that the grievants continuously worked for the Respondent several years. Consequently, I find and hold that they met the requirement for conversion from casual to regular term contract otherwise called permanent employment, terminable only through due process. Unfair termination 35.The Claimants case is that the grievants employment was terminated in February 2023 without compliance with Section 41, and 45 of the Employment Act. CW1 testified that the Respondent sent them away promising to call them back after three months but they were never called back. The Claimant averred that the Respondents constructively terminated the grievants employment. 36.RW1 denied the alleged unfair termination and maintained that the grievants were employees engaged on need basis and from the beginning of 2023 they were not called to work. I have already noted above, the Respondent did not produce any records of employment to disprove the employment terms alleged by the grievants including the period served. I have further made a finding of fact that their casual employment converted to term contract enjoying protection from abrupt or unfair termination by the employer. 37.Section 35 (1) (c) of the Employment requires 28 days written notice before termination while Section 36 allows for payment of salary in lieu of notice. Section 45 (1) and (2) of the Act then provides that:-“(1).No employer shall terminate the employment of an employee unfairly.(2)A termination of employment by an employer is unfair if the employer fails to prove-a.That the reason for the termination is valid;b.That the reason for the termination is a fair reason-i.Related to the employees conduct, capacity or compatibility; orii.Based on the operational requirements of the employer; andc.That the employment was terminated in accordance with fair procedure.” 38.In this case there is an implied admission by the Respondents that they never complied with Section 35 and 45 of the Employment Act. They just set the grievants away promising to call them back after three months which they never did. This amounted to constructive dismissal. In the case of Western Excavating ECC Ltd v. Sharp[1978] 2 WLR Lord Denning held that:-“If the employer is guilty of conduct which is significant breach going to the moot of the contract of employment, or which shows that the employer no longer intends to be bound by one or more of the essential terms of the contract, then the employee is entitled to treat himself as discharged from any further performance. If he does so, he terminates the contract by reason of the employers conduct, he is constructively dismissed.” 39.In the instant case, the Claimant has proved that the employer’s conduct of sending them away for three months and failing to call them back as promised, was an indication that the employer was no longer willing to be bound by the terms of their employment contract. Consequently I find and hold that the Claimant has proved that the grievants were constructively dismissed by the Respondents which essentially amounts to unfair termination. Reliefs 40.In view of the foregoing conclusion, I find that the Claimant is entitled to declaration that the grievants were constructively dismissed by the Respondent. Under Section 49 (1) of the Employment Act, the Claimant is also entitled to award of salary in lieu of notice plus compensation for the unfair termination. I award each one month salary in lieu of notice being a right under Section 35 (1) (c) read with Section 36 of the Act. As regards compensation I award each grievant ten months gross salary save for the 3rd grievant(Edwin Owuor) who is awarded two months gross salary. In awarding the above compensation, I have considered the length of service by each grievant and the fact that they never contributed to the termination through misconduct. 41.The Claimant further prayed for service pay contending that the employer failed to register them with social security fund. RW1 admitted that the grievants were never subjected to statutory deductions because they were casual employees. Section 35 (5) and (c) of the Employment Act provides that:-“An employee whose contract of service has been terminated under subsection (1) (c) shall be entitled to service pay for every year worked, terms of which shall be fixed.”(b)This section shall not apply where an employee is a member of:-(a)a registered pension….(b)a gratuity or service pay scheme….(c)any other scheme…..(d)the National Social Security Fund.” 42.The admission said by RW1 that the grievants were not beneficiaries of any social security scheme mandates this court to find that the Claimant is entitled to the prayer of service pay at conventional rate 15 days pay for each completed year of service. 43.The Claimants further prayed for annual leave for three years for all the grievants except the 3rd grievant who served for two years only. The Respondents did not rebut that claim by leave records. Having found that the grievants were in continuous service, I further find that they were entitled to annual leave after every twelve consecutive months of service by dint of Section 28 of the Employment Act. Consequently the prayer for leave is granted as payed. 44.As regards the claim for salary under payment, no evidence was adduced or any basis laid to prove the same. Consequently, I decline to award the same since the Claimant has failed to discharge its burden of proof. Likewise the claim for public holidays worked lacks particulars and it is declined. Conclusion 45.I have found that the grievants had converted from casual to term contract employees as at start of the year 2023 when their services were terminated by the Respondents. I have further found that the termination was unfair within the meaning of Section 45 of the Employment Act and that they are entitled to some of the reliefs sought. Consequently I enter Judgment for the Claimant against the Respondents jointly and severally as follows:-a.Declaration that the grievants were constructively dismissed by the Respondents.b.Payment of the following:-1st Grievant Jared Oigara MaseseNotice…………………………Kshs. 8,000/-Compensation……………….Kshs. 80,000/-Service pay (3 years)……….Kshs. 12,000/-Leave pay (3 years)…………Kshs. 16,800/-Total…………………………..Kshs. 116,800/-2nd Fredrick Macharia NyagiNotice…………………………Kshs. 8,000/-Compensation……………….Kshs. 80,000/-Service pay (3 years)……….Kshs. 12,000/-Leave pay (3 years)…………Kshs. 16,800/-Total…………………………..Kshs. 116,800/-3rd Grievant Edwin Okinyi OwuorNotice…………………………Kshs. 10,000/-Compensation……………….Kshs. 20,000/-Service pay (2 years)……….Kshs. 10,000/-Leave pay (2 years)…………Kshs. 14,000/-Total…………………………..Kshs. 54,000/-4th Grievant John Kamau MungaiNotice…………………………Kshs. 8,000/-Compensation……………….Kshs. 80,000/-Service pay (3 years)……….Kshs. 12,000/-Leave pay (3 years)…………Kshs. 16,800/-Total…………………………..Kshs. 116,800/-5th Grievant James Kangethe MutungaNotice…………………………Kshs. 8,000/-Compensation……………….Kshs. 80,000/-Service pay (3 years)……….Kshs. 12,000/-Leave pay (3 years)…………Kshs. 16,800/-Total…………………………..Kshs. 116,800/-6th Grievant Charles Munyaka WambuguNotice…………………………Kshs. 8,000/-Compensation……………….Kshs. 80,000/-Service pay (3 years)……….Kshs. 12,000/-Leave pay (3 years)…………Kshs. 16,800/-Total…………………………..Kshs. 116,800/-7th Grievant Samson Muembo MasilaNotice…………………………Kshs. 8,000/-Compensation……………….Kshs. 80,000/-Service pay (3 years)……….Kshs. 12,000/-Leave pay (3 years)…………Kshs. 16,800/-Total………………………….Kshs. 116,800/-c.The Claimant is awarded costs plus interest at court rates from the date of this Judgment till payment in full.d.The award of damages is subject to statutory deductions. DATED SIGNED AND DELIVERED VIRTUALLY IN OPEN COURT AT NAIROBI THIS 20TH DAY OF MAY 2026.ONESMUS MAKAUJUDGEAppearanceOnwong’a for ClaimantMatiba for Respondent