https://new.kenyalaw.org/akn/ke/judgment/keelrc/2026/2261

 **REPUBLIC OF KENYA** **IN THE EMPLOYMENT AND LABOUR RELATIONS COURT AT NAIROBI** (ON Makau J on 30th July 2026) **CAUSE NO. E621 OF 2024** **NICHOLAS MWANGI MAINA.....................................CLAIMANT** **-VERSUS-** **NATIONAL COFFEE CO-OPERATIVE** **UNION LIMITED……………………………………….......RESPONDENT** **JUDGMENT** **Introduction** 1. The Claimant was employed by the Respondent as Chief Executive Officer (CEO) vide a letter of offer dated 10th May 2022 for a period of three years renewable based on performance. The contract was also terminable by a 30 days written notice. His monthly basic salary was Kshs. 200,000, leave allowance of Kshs. 15,000 and 32 working days leave per annum. His first 90 days was probation period. 2. By a letter dated 19th May 2023, the Respondent terminated Claimant’s employment with immediate effect citing incompetence and failure to improve despite several verbal warnings. He was also accused of failure to involve the Board or the Secretariat’s procurement sub-committee in the process of renovating offices at Murang’a Building I Thika. The letter also cited disconnect between the Secretariat and the CEOs office. 3. The Claimant was aggrieved and brought this suit seeking the following reliefs: - 4. ***Kshs. 1,500,000/- being the wages earned by the Claimant from 16th May 2022 to December 2022.*** 5. ***Kshs. 200,000/- being 1 month’s salary in lieu of notice of termination of employment contract.*** 6. ***Kshs. 228,333/- being dues for 32 leave days accrued and not utilized plus leave allowance.*** 7. ***Interest on (a), (b) and (c) above at court rates from the date of filing suit until payment in full.*** 8. ***Kshs. 2,400,000/- being damages for unfair and un-procedural termination of employment contract.*** 9. ***Interest on (e) above at court rates from the date of delivery of judgment until payment in full.*** 10. ***Costs of the suit.*** 11. The Respondent was served with pleadings and summons but failed to enter appearance and file defence. As a result, the suit proceeded by formal proof on 13th May 2026. **Evidence** 1. The Claimant testified as CW1 and adopted his written statement dated 1st August 2024 as evidence in chief. He also produced as exhibits bundle of documents dated even date. 2. In brief, his evidence was that he started work on 16th May 2022 and executed his duties diligently and competently. He further stated that from May to December 2022 (8 months) he was not paid his salary despite tremendous improvement in the coffee sector and donation of an office premises in Thika town. He contended that he received the first salary in January 2023 and continued upto May 2023 when his services were unfairly terminated. 3. He stated that on 16th May 2023 he was summoned to a meeting with the chairman of the Respondent’s Board of Directors at office in Thika. The meeting was also attended by the Vice Chairman, Secretary and the Treasurer of the Board. Several incomprehensible allegations were levelled against him. 4. He stated that, during the meeting, he denied the allegations and demonstrated that he involved the Board and the Secretariat procurement sub-committee in the process of renovating the Respondent’s office. He also demonstrated that he conducted himself in accordance with the Respondent’s policies and the terms of his employment contract. 5. On 19th May 2023, he received a termination letter accusing him for failure to demonstrate the necessary competencies required to effectively perform his duties. He contended that he was never invited to show cause why he should not be dismissed for any of the reasons detailed in the termination letter. 6. He averred that the reasons for the termination were not valid. He further averred that his contract did not provide for evaluation after the 90 days probation. He further averred that he was never invited for any performance appraisal despite being easily available during Board meetings which he attended without failure. 7. He further stated that the performance evaluation allegedly done by the Board and which led to his dismissal was strange to him since he was not involved. He denied ever receiving any verbal warning during his employment and maintained that his dismissal was unfair and it caused on him grave injury. 8. He averred that despite demand and notice of intention to sue, the Respondent failed to pay his salary arrears of Kshs. 1,800,000 for May- December 2022 plus salary in lieu of notice. It also failed to pay 32 leave days plus his leave allowance of Kshs. 15,000. He prayed for Kshs. 1,928,333 plus compensation for unfair termination being Kshs. 2,400,000. 9. After the hearing, the Claimant filed written submissions. Having carefully considered the pleadings, evidence and the submissions, there is no doubt the Claimant was employed by the Respondent under a three years contract from 16th May 2022 but it was prematurely terminated by the Respondent vide the letter dated 19th May 2023. The issues for determination are:- 10. Whether the termination of the contract of employment was unfair and unlawful 11. Whether the Claimant is entitled to the reliefs sought. **Unfair termination** 1. Section 45 (2) of the Employment Act 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-*** 1. ***That the reason for the termination is valid;*** 2. ***That the reason for the termination is a fair reason-*** 3. ***Related to the employees conduct, capacity or compatibility; or*** 4. ***Based on the operational requirements of the employer; and*** 5. ***That the employment was terminated in accordance with fair procedure.”*** 6. The above provision places a heavy burden on the employer to prove by evidence that termination of employment of an employee was grounded by a valid reason related to the employees conduct, capacity or compatibility or employees operational requirement and that fair procedure was followed. Fair procedure mainly refers to explaining the reason for the termination to the employee and then giving him a fair opportunity to air his representations which must be considered before the decision to terminate the contract of service. 7. In the instant case the Claimant state that the reasons cited from the termination were not valid or substantiated and that he was not invited to show cause. The evidence by the Claimant and his pleadings were not controverted and therefore Respondent did not discharge the burden of proving valid reason for terminating the Claimant’s employment. 8. The Respondent did not prove that it evaluated the Claimant’s performance on the basis of agreed targets. The offer letter did not provide for performance appraisal after the probation period of 90 days. No evidence of warnings for no-performance was adduced. The alleged unilateral procurement for office renovation has also not been substantiated. Consequently, I hold that the reasons for termination cited in the termination letter were not substantiated and therefore they were invalid. 9. As regards the procedure followed, the Claimant acknowledged that he was invited to a meeting with the Chairman of the Respondents Board of Directors where incomprehensive allegations were made against him and he responded. However, he contended that he was not invited to show cause, or given prior notice. He was also not issued with certificate of service and his salary arrears was not paid. 10. Section 41 of the Employment Act which sets that:- ***“(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, an 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 grounds of misconduct or poor performance, and the person, if any, chosen by the employee within subsection (1), make.”*** 1. In this case, the Claimant served for one year before termination on 19th May 2023 and therefore he was not under probationary terms. His probation under clause 1.0 of his contract was for 90 days. The Respondent did not adduce any evidence to prove that the probation period was been extended to 19th May 2023. 2. It follows that termination of the Claimant’s contract for the reasons cited in the termination letter required compliance with the procedure set out under Section 41 above. The Claimant was not formally invited for any disciplinary hearing in the company of a fellow employee of his choice and formally given a fair opportunity to defend himself of the allegations. Consequently, I reiterate that the termination of Claimants employment was not in accordance with a fair procedure. 3. Having found that the Respondent did not prove that the reasons cited in the termination letter were valid, and that a fair procedure was followed, I proceed to hold that the termination was unfair and unlawful within the meaning of Section 45 of the Employment Act. **Reliefs** 1. In view of the forgoing conclusion, I find that the Claimant is entitled to remedy under Section 49(1) of the Act. His contract of employment provided for one month notice before termination but he was not given such notice. Therefore I award him Kshs. 200,000 being one month salary in lieu of notice. 2. He is further entitled to compensation for the unfair termination. Considering the senior position he held, he may have very slim chances of securing alternative job within a short time. He also served for period of one year and he was never served with any warning letter for indiscipline. No misconduct or poor performance was proved against him in this case. Taking in account the above matters I find that an award of two months salary compensation to be reasonable financial cushion while hunting for another job. 3. He further prayed for Kshs. 1,500,000 being salary arrears for the period between 15th May and December 2022 being 7.5 months. No evidence has been adduced to prove that the said salary was paid. Consequently, I award the said Kshs. 1,500,000 salary arrears. 4. The prayer for 32 days leave is granted because, he served for one year and no evidence was adduced to prove that he utilized the leave. In any event, the termination occurred at the time when the leave had just matured. Consequently, I award him Kshs. 200,000 x 32/30 = Kshs. 213,333.333. 5. In conclusion, I enter Judgment for the Claimant as follows:- 6. Notice……………………………Kshs. 200,000/- 7. Compensation………………….Kshs. 400,000/- 8. Salary arrears…………………..Kshs. 1,500,000/- 9. Leave…………………………….Kshs. 213,333.33/- **Total……………………………..Kshs. 2,313,333.33/-** 1. The above award is subject to statutory deduction. 2. Claimant is awarded costs plus interest at court rates from the date of this Judgment. **DATED, SIGNED AND DELIVERED VIRTUALLY IN OPEN COURT AT NAIROBI THIS 30TH DAY OF JULY, 2026.** **ONESMUS MAKAU** **JUDGE** **Appearance:** Kimathi for Claimant Kimutai for Respondent