https://new.kenyalaw.org/akn/ke/judgment/keelrc/2026/2337

Odundo v Step to the Future Academy Ltd (Appeal E173 of 2023) [2026] KEELRC 2337 (KLR) (29 July 2026) (Judgment) Neutral citation: [2026] KEELRC 2337 (KLR) Republic of Kenya In the Employment and Labour Relations Court at Nairobi Appeal E173 of 2023 DKN Marete, J July 29, 2026 Between Millicent Atieno Odundo Appellant and Step To The Future Academy Limited Respondent Judgment 1.This matter was originated by way of Memorandum of Appeal dated 10th February, 2025. It is an appeal from the judgment and decree of the trial court in Kiambu MCELRC/E010 of 2022 delivered on 30th August, 2023 2.It comes out as follows:1.The learned Magistrate erred both in law and fact in dismissing the Appellant’s case on the grounds that the Respondent through her witnesses had proved that the Claimant had become disrespectful by insubordination of teachers.2.The learned Magistrate erred both in law and fact in finding that the Claimant had been given a warning, despite overwhelming evidence that no warning letter was presented before court.3.The learned Magistrate erred in law and fact by failing to evaluate the evidence presented to him that clearly shows that the Respondent’s witnesses had not been authorised by the Respondent to testify on the Respondent’s behalf and that no letter of authority was filed in court.4.The learned Magistrate erred in law and fact by failing to evaluate the evidence that clearly shows that the decision of the Respondent’s director to dismiss the Claimant was never ratified by the Respondent’s board of governors, and that the Appellant was never issued with any show cause letter or summoned to any disciplinary hearing.5.The learned Magistrate erred in law in proceeding under the wrong principles of Employment and Labour Laws, thereby failing to award the Appellant her employment dues.6.The learned Magistrate erred in law by failing to consider section 74 of the Employment Act on the responsibility of the employer to provide employment records.7.The learned Magistrate erred both in law and fact by failing to consider that it was not in dispute that the Appellant was employed by the Respondent as a cleaner for 5 years and 4 months, and therefore qualifies to be issued with a certificate of service.8.The learned Magistrate erred both in law and fact by failing to consider that the Appellant was paid a monthly salary of Kshs. 10,000/= which was below the statutory minimum of Kshs. 12,522.70/= exclusive of housing allowance as provided under the Regulation of Wages (General) (Amendment) Order 2018. Therefore, the Appellant is entitled to payment of is salary underpayments.9.The learned Magistrate erred both in law and fact by failing to make an award in favour of the Appellant for the sum of Kshs. 23,892/= on account of unremitted NSSF deduction. The learned magistrate failed to consider the attached Appellant NSSF statement which clearly indicates the Appellant deductions were never submitted for some months by the Respondent.10.The learned Magistrate erred both in law and fact by failing to make an award in favour of the Appellant for the sum of Kshs. 11,000/= on account of unremitted NHIF deduction.11.The learned Magistrate erred both in law and fact by failing to make an award in favour of the Appellant for the sum of Kshs. 150,272.40/= on account of compensation equivalent to 12 months’ salary for wrongful dismissal despite overwhelming evidence that the Appellant was a diligent employee who had a professional working relation with both the teacher and support staff. It was also clear that the Respondent never observed the rules of natural justice prior todismissing the Appellant.12.The learned Magistrate erred both in law and fact by failing to make an award in favour of the Appellant for the sum of Kshs. 12,522.70/= on account of one month’s pay in lieu of notice for wrongful dismissal.13.The learned Magistrate erred both in law and fact in failing to make an award in favour of the Appellant for the sum of Kshs. 67,622.58/= on account of housing allowance, the Appellant having never been provided with a housing unit within the school compound or a housing allowance. The Appellant was in Law entitled to 15% equivalent to his salary as a housing allowance.14.The learned Magistrate erred both in law and fact by dismissing the Appellant’s suit and directing the Appellant to bear the costs of this suit.15.The learned Magistrate erred both in law and fact in failing to award a Certificate of Service which the Appellant was in Law entitled.16.The learned Magistrate erred both in law and fact to appreciate the correct evidence adduced and tendered in Court.17.The learned Magistrate erred both in law and fact by failing to apply the law or the principals of equity. 3.The Appellant prays for orders:i.The appeal herein be and is hereby allowed.ii.The judgment and decree of the trial court delivered on 30th August 2023 in Kiambu MC. ELRC No. E010 of 2022 be set aside.iii.This court be pleased to award the Appellant the terminal dues and compensation as prayed in the Appellant’s Memorandum of Claim.iv.The costs of the appeal and the lower court be awarded to the Appellant.v.This court do issue such orders and relief as it may deem fit and just to grant. 4.It is the Appellant’s case that she was employed as a cleaner by the Respondent, a private school situated at Nyala Estate along Githunguri Road in Kiambu County, from May, 2016. She was initially paid a monthly salary of Kshs. 8,000.00 which was subsequently increased to Kshs. 10,000.00 She was never issued with a letter of appointment or a written employment contract. Her child was a pupil at the same school. Her employment was terminated on 16th August, 2021. Upon termination she was paid Kshs. 15,000.00 Being dissatisfied with the determination of the trial court, the Appellant preferred the present appeal challenging the entirety of the judgment and urging this court to find that the termination was unfair and unlawful, that she is entitled to terminal dues and compensation, and that costs follow the event. 5.It is the Appellant’s submission that the law is settled that a termination of employment is unfair unless the employer proves the existence of a valid reason, demonstrates that the reason is fair, and shows that the termination was carried out in accordance with a fair procedure, placing reliance on sections 41, 43, 44 and 45 of the Employment Act, 2007. 6.The Appellant submits that on 16th August, 2021 her child who was a pupil at the school fell sick following a malaria attack. A teacher informed her of the child’s sickness. She was referred to teacher Peninah who informed her that the school had drugs stored in the office. The Appellant objected to her child being given drugs without any prescription by a doctor, noting that there was no doctor present at the school at the time. She thereafter took her child to a dispensary where the child was treated. It was the Appellant’s case that it was this objection that precipitated her dismissal and not any act of misconduct on her part. 7.The Appellant further submits that she was never summoned to any disciplinary meeting, never issued with a notice to show cause or any warning letter prior to her dismissal. Her employer, one, Daniel, the director of the Academy, called a teachers’ meeting on 16th August, 2021 to which the Appellant was not invited. Following that meeting she was informed that she and a colleague had been summarily dismissed. She denied each and every allegation of misconduct levelled against her, including allegations that she undermined teachers, prevented children from accessing washrooms, or failed to carry out her cleaning duties. 8.On quantum, the Appellant submits that her salary of Kshs. 10,000.00 per month was below the minimum statutory wage of Kshs. 12,522.70 for cleaners under the Regulation of Wages (General) (Amendment) Order, 2018. She claims salary underpayments, one month’s pay in lieu of notice, compensation for unfair termination, housing allowance at 15% of the minimum statutory wage, and reimbursement for unremitted NSSF and NHIF contributions for 22 months between May, 2016 and February, 2018 as evidenced by her NSSF statement. The Kiambu County Labour Officer had independently assessed and recommended payment of dues totalling Kshs. 132,550.00 of which only Kshs. 15,000.00 was paid by the Respondent. 9.The Respondent raises a preliminary objection to the effect that the Appellant instituted proceedings against a non-existent legal entity. The Respondent’s documentary evidence shows that the registered entity is “Steps to the Future School,” a business name owned by one Enos Emoyi and registered under the Business Registration Act Chapter 499, Laws of Kenya, while the suit was filed against “Step to the Future Academy Limited.” The Respondent contends that these are wholly different legal entities and that the Appellant was duly notified of the correct name of her employer by letter dated 22nd July, 2019 issued by the directors of Advancing His Kingdom International and that the Appellant’s own NSSF statement produced as her exhibit confirmed that her employer was Advancing His Kingdom International. On this basis the Respondent urges that the Appellant is non-suited and the appeal ought to be dismissed. 10.On the merits, the Respondent submits that the trial court properly directed himself on both fact and law. It is the Respondent’s submission that the Appellant was justifiably summarily dismissed for gross misconduct comprising insubordination of teachers and the school administration, denying school children access to washroom facilities causing them to soil themselves in class, carelessly and improperly performing her cleaning duties, and behaving in an insulting manner towards persons placed in authority over her. The Respondent avers that the Appellant’s dismissal was not caused by her objection to having her child medicated but by these continuing acts of misconduct, which were established through the evidence of RW1, RW2 and RW3 and which the trial court correctly found to be credible and uncontroverted. 11.On procedure, the Respondent submits that a board meeting was held which resolved to dismiss the Appellant, that a verbal notice was issued to her, and that Daniel had authority to execute the board’s decision without further ratification. On quantum, the Respondent contends that the applicable minimum wage for the Kiambu area was Kshs. 7,240.95 inclusive of house allowance, making the Kshs. 10,000.00 paid an overpayment. The Respondent further submits that NSSF and NHIF remittances were paid in full, that no notice pay is due given the justified summary dismissal, and that no compensation is payable. 12.After a considered look and scrutiny of the Memorandum of Appeal, the Record of Appeal and the submissions of the parties the issues for determination therefore become;1.Whether the Respondent’s preliminary objection on the identity of the correct Respondent is merited.2.Whether the Appellant’s termination from employment was unfair and unlawful.3.Whether the Appellant is entitled to terminal dues and compensation as sought.4.Who bears the costs of this cause. 13.The 1st issue for determination is whether the Respondent’s preliminary objection on the identity of the correct Respondent is merited. This court notes as follows; The Respondent participated fully in the proceedings before the trial court. It filed a written statement of defence, called three witnesses, produced five exhibits, and cross-examined the Appellant. At no point during those proceedings did the Respondent press the misnaming point to a determination or apply to strike out the suit. The trial court proceeded to hear and determine the matter on the merits, as did the parties. The Respondent cannot now, having fully participated in and defended those proceedings, turn on appeal and urge that the proceedings were a nullity by reason of a technical misnaming of the entity. To permit this would be to allow a party to approbate and reprobate, which equity is abhorred by equity. Moreover, the Employment Act, 2007 and the overriding objective of the court require that disputes between employers and employees be determined on their merits. 14.The issue in dispute before this court is whether an employment relationship existed and whether it was lawfully terminated. That question is not affected by whether the correct registered name of the school was used. In any event, what is urged is at worst a misnomer and not the suing of a stranger to the employment relationship. The Appellant sued her employer in the name and style under which the school held itself out to her, engaged her and remunerated her, and the Respondent entered appearance, filed a defence, called three witnesses and cross-examined the Appellant in that very name without protest. A misnomer of a party who has appeared and fully defended the proceedings does not render these a nullity; it is an irregularity curable without injustice to either party. Article 159(2)(d) of the Constitution of Kenya, 2010 enjoins this court to administer justice without undue regard to procedural technicalities. The preliminary objection therefore fails and the court proceeds onto the merits of the matter. 15.The 2nd issue for determination is whether the Appellant’s termination from employment was unfair and unlawful, this court is guided by the appellate principles in Peters v Sunday Post Ltd [1958] EA 424 and namely that an appellate court may interfere with findings of fact where the trial court has failed to take advantage of having seen and heard the witnesses, where the findings are inconsistent with the evidence on record, or where the findings are plainly wrong. This court is further guided by the authority of Selle and Another v Associated Motor Boat Co. Ltd and Others [1968] EA 123 to the same effect. 16.The trial court at paragraph 8 of the judgment found that the Appellant during the course of discharge of her duties had become disrespectful to the teachers and the Academy administration, insubordinated the teachers and denied the children access to the washrooms, and that these acts remained unchallenged and uncontroverted amounting to gross misconduct. At paragraph 9 the learned Magistrate further found that the Appellant’s conduct was discussed through a staff meeting held on 5th August, 2021 and that the Appellant had violated section 17(c) and (d) of the Employment Act, 2007. 17.With all due respect, the trial court fell into error on multiple counts. First, on the characterisation of the misconduct evidence as uncontroverted: the typed proceedings show clearly that the Appellant in cross-examination specifically denied each and every allegation. She denied undermining teachers, denied preventing children from accessing washrooms, denied failing to carry out her duties and also denied being rude or mistreating the children. The finding that this evidence was unchallenged is plainly inconsistent with what the record discloses. 18.Again, the Respondent’s own witnesses in cross-examination significantly undermined the case for gross misconduct. RW1 Penina Andayi Ondema admitted that she was not responsible for the Appellant’s dismissal, that no notice to show cause or warning letter were served upon the Appellant was ever filed in court and that the staff meeting minutes confirmed the Appellant was not invited to that meeting. Besides, the staff meeting itself did not reach any resolution to dismiss the Appellant. RW2 Lucy Njeri testified that she personally never complained about the Appellant, did not know who dismissed her, was not the Appellant’s supervisor and therefore could not assess whether she was performing her duties well. RW3 Elizabeth Wanjiku confirmed that she never made any complaint against the Appellant prior to the dismissal, was not aware of any board meeting resolving to dismiss the Appellant, and acknowledged that her own letter on the matter was undated. 19.Thirdly, and most critically, the complaint letters relied upon by the Respondent bear dates of 19th August, 2021 and 25th August, 2021. The Appellant was dismissed on 16th August, 2021. These letters postdate the dismissal by three to nine days respectively. They cannot have formed the basis for a dismissal that had already occurred. This court finds that the misconduct allegations were an afterthought, constructed to justify a decision that had already been made. The trial court failed to appreciate this fatal inconsistency in the Respondent’s case. 20.Fourth, on the staff meeting, the trial court at paragraph 9 of the judgment relied on a staff meeting held on 5th August, 2021 as the forum at which the Appellant’s conduct was discussed. However, RW1 confirmed in cross-examination that the staff meeting minutes bore the school’s stamp acknowledging 16th August, 2021 as the actual date of the meeting, and that the Appellant was not invited to it. More so, RW1 conceded that the staff meeting reached no resolution to dismiss the Appellant. No minutes of any board of management meeting resolving to terminate the Appellant’s employment were produced in evidence. The trial court failed to appreciate the distinction between a staff meeting of teachers and a board of management meeting with authority to dismiss an employee. 21.Fifth, the learned Magistrate erred in law by applying section 17(c) and (d) of the Employment Act, 2007. Section 17 falls under Part III of the Act which deals with payment, disposal and recovery of wages and allowances. It has no application to the question of misconduct or summary dismissal. The applicable provisions are sections 41, 43, 44 and 45 of the Act. The court applied the wrong provisions of the law. 22.On procedural fairness: section 41 of the Employment Act, 2007 requires that before terminating employment on grounds of misconduct an employer must explain the reason for the proposed termination to the employee in a language the employee understands and afford the employee an opportunity to be heard with a representative of their choice. Section 43(1) places the burden of proving the reason for termination squarely on the employer. The evidence is uncontested that the Appellant was never issued with a show cause letter or warning, was not invited to the staff meeting on 16th August, 2021, and learnt of her dismissal only after that meeting had concluded. No board resolution minutes were produced. The Respondent has not discharged the burden of proving either a valid reason for dismissal or compliance with fair procedure. As this court observed in James Ondima Kabesa v Trojan International Limited [2017] eKLR, fair termination requires both substantive justification and procedural compliance under sections 41 and 43; where either limb fails the termination is unfair under section 45. 23.This court finds that the termination of the Appellant’s employment on 16th August, 2021 was both substantively and procedurally unfair within the meaning of sections 43, 44 and 45 of the Employment Act 2007. The evidence points to one operative cause of the dismissal: the Appellant’s objection on 16th August 2021 to her child being administered medication without a doctor’s prescription. The Respondent has not proved any valid reason for summary dismissal. 24.The 3rd issue for determination is whether the Appellant is entitled to terminal dues and compensation as sought. Having found the termination to be unfair both substantively and procedurally, this court proceeds to assess the appropriate reliefs as below. 25.On salary underpayments: the minimum monthly wage applicable to a cleaner under the Regulation of Wages (General) (Amendment) Order 2018 was Kshs. 12,522.70 exclusive of housing allowance. The Appellant was paid Kshs. 10,000.00 per month. The Respondent produced no itemised payslips demonstrating the basis of payment or any deconsolidation of salary and housing allowance as required under section 74(1)(i) of the Employment Act, 2007. The Kiambu County Labour Officer’s independent computation of salary underpayments is persuasive corroborating evidence. The court awards salary underpayments for the period September 2018 to August, 2021 to the tune of Kshs. 90,817.20 26.On one month’s salary in lieu of notice: all three Respondent witnesses confirmed in cross-examination that no written notice was ever issued to the Appellant. The Respondent’s own defence at paragraph 7 acknowledged that the Claimant ought to have been paid one and a half months’ salary, yet only Kshs. 15,000.00 was paid. No valid ground for summary dismissal having been established, notice pay is due under section 35(1)(c) of the Employment Act aforesaid. The court awards one month’s salary in lieu of notice at the minimum statutory rate of Kshs. 12,522.70.00. The lawful statutory wage, and not the unlawfully depressed wage actually paid, is the proper multiplicand for the terminal awards herein; an employer is not permitted to take advantage of its own breach of the Regulation of Wages (General) (Amendment) Order, 2018 to diminish the remedies of the employee it underpaid. 27.On compensation for unfair termination: the Appellant worked for the Respondent for approximately five years and four months. Having regard to the nature and length of service, the manner of dismissal, the complete absence of any prior warnings or disciplinary process and the substantive and procedural unfairness established, and guided by the Court of Appeal’s holding in Kiambaa Dairy Farmers Co-Operative Society Limited v Rhoda Njeri & 3 others [2018] eKLR that compensation must be assessed within the range of zero to twelve months having regard to the gravity of the violation, the court awards compensation equivalent to 12 months’ gross salary at the minimum statutory rate, being Kshs. 150,272.40 28.On housing allowance: the minimum statutory wage of Kshs. 12,522.70.00 under the Regulation of Wages (General) (Amendment) Order 2018 is expressly stated to be exclusive of housing allowance. RW3 confirmed in cross-examination that the Appellant did not reside within the school premises. The Respondent produced no itemised payslips or deconsolidation documentation as required under section 74(1)(i) of the Employment Act to demonstrate that any housing allowance was paid. The court awards housing allowance at 15% of the minimum statutory wage for the period of three years as claimed, being Kshs. 67,622.58.00 29.On unremitted NSSF and NHIF deductions: the Appellant produced her NSSF statement demonstrating non-remittance of contributions for 22 months covering portions of 2016, 2017 and 2018. The Respondent’s defence at paragraph 5 claimed to have paid the dues without deducting from the Claimant’s salary, but produced no certificate of compliance or remittance records to substantiate this. Statutory contributions which were never remitted are, however, payable to the respective statutory funds and not to the employee in hand, the employee never having been entitled to receive such sums directly. This court accordingly orders the Respondent to remit to the National Social Security Fund unremitted contributions of Kshs. 23,892.00.00 and to the National Hospital Insurance Fund unremitted contributions of Kshs. 11,000.00.00 in each case in respect of and to the credit of the Appellant. 30.Finally, the sum of Kshs. 15,000.00 admittedly paid to the Appellant upon her termination shall be set off against the monetary awards herein. 31.I am therefore inclined to allow the Appeal with the following orders:i.The judgment of the trial court delivered on 30th August, 2023 in Kiambu MC. ELRC No. E010 of 2022 is set aside.ii.A declaration be and is hereby issued that the termination of the Appellant’s employment by the Respondent on 16th August, 2021 was unfair and unlawful.iii.One (1) month’s salary in lieu of notice ……………………………..…Ksh. 12,522.70iv.Twelve (12) months compensation for unlawful termination of employment ……………………………………………………………………….Ksh. 150,272.40.v.Unpaid housing allowance …………………………………………….Ksh. 67,622.58vi.Salary underpayments ………………………………………………. Kshs. 90,817.20Total of award ………………………………………………………..Ksh321,234.88vii.The Respondent shall remit to the National Social Security Fund unremitted contributions of Kshs. 23,892.00 in respect of and to the credit of the Appellant.viii.The Respondent shall remit to the National Hospital Insurance Fund unremitted contributions of Kshs. 11,000.00 in respect of and to the credit of the Appellant.ix.The total monetary award payable to the Appellant, after setting off the sum of Kshs. 15,000.00 already paid to her upon termination, is Kshs. 306,234.88x.The Respondent shall issue the Appellant with a Certificate of Service within 30 days of this judgment of court.xi.Costs of the appeal and the lower court proceedings are awarded to the Appellant. DELIVERED, DATED AND SIGNED THIS 29TH DAY OF JULY 2026.D. K. NJAGI MARETEJUDGEAppearances:1. Mr. Magonda instructed by Magonda Advocates for the Appellant.2. Mr. Mbullo instructed by Nathan Mbullo & Ass. Advocates for the Respondent.