https://new.kenyalaw.org/akn/ke/judgment/keelrc/2026/1790

**REPUBLIC OF KENYA** **IN THE EMPLOYMENT AND LABOUR RELATIONS COURT** **AT MOMBASA** *(Before Hon. Lady Justice Monica Mbarũ)* **CAUSE NO. E102 OF 2025** **PAMELA ADHIAMBO OGADA CLAIMANT** *VERSUS* **KWALE INTERNATIONAL SUGAR CO. LIMITED RESPONDENT** **JUDGMENT** The claimant is a female adult. The respondent is a limited liability company. The respondent employed the claimant as a human resource manager on 1 March 2013. The claim is that on 18 October 2022, the respondent issued a notice to the claimant terminating her employment without due process or payment of terminal dues. She was earning Ksh. 824,147 per month. She claimed that the termination of employment was devoid of both substantive and procedural fairness. She claimed the following terminal dues: 1. 3 months' notice pay Ksh. 824,147 x 3 = Ksh. 2,472,441. 2. 18 months' salary arrears Ksh. 13,763,267. 3. 12 months' compensation Ksh. 9,889,764. 4. Unpaid leave for 27 days, Ksh. 741,732. 5. House allowance for 18 months Ksh. 2,064,490. 6. Unremitted NSSF dues from 2019 to 2025 Ksh. 27,200. 7. Exemplary damages Ksh. 5,000,000. 8. Certificate of service. 9. Costs of the suit. The claimant testified that on 15 January 2015, she was employed by the Respondent as an assistant general manager. On 1 November 2016, she was promoted to general manager, a role she held for 10 years, earning Ksh. 824,147 per month. However, on 24 August 2025, while on duty, she presented employees’ requests for emergency and personal needs to the management via email, arising from inconveniences caused by the personal delay in the payment of salaries and wages. In response, the director, Harshil Kotecha, dismissed the concerns, stating that the respondent had paid employees during COVID, while other employers were not paying. Hence, the claim should arise from her being disrespectful in the course of her employment. The claimant was thus forced to tender her resignation letter on 25 August 2025, which was accepted by the respondent. For 18 months, there was no payment of salary, including house allowance, leave days or statutory remittances. There was an unfair termination of employment, and the orders sought should be issued with costs. Upon cross-examination, the claimant admitted that she was employed under a contract. The contract provided for a salary of Ksh. 389,139, but she claims a salary of Ksh. 824,137 that would be deposited in her bank account. She was not issued a pay slip showing the total breakdown of her salary. The claimant testified that she discussed the additional salaries with the respondent. In July 2023, she was paid KSh. 829,384. In February 2024, she was paid Ksh. 682,000. In October 2024, she was paid Ksh. 817,460. November 2024 Ksh. 816,020. December 2024 Ksh. 819,686. March 2025 Ksh. 818,174. The last payment was in May 2024, Ksh. 167,395. These payments are derived from the bank statement. The statements capture only salary deposits, not other entries. In response, the Respondent admitted that the claimant was an employee. There were various reasons for the lack of growth as projected. The claimant’s resignation on 25 August 2025 was overreactive to a solitary email or calculated to generate a financial windfall to the claimant. The failure to pay salaries was due to a financial crisis, of which the claimant was aware. The respondent closed operations during the financial crisis. Given the closure, the claimant cannot reasonably argue that she fully discharged her duties but was not paid. The claimant's communication was therefore abusive and derogatory. The claims made are denied, save for the admissions of: 1. Unpaid salary for 17 months. 2. Unpaid leave days for 27 days. 3. Unpaid house allowance for 17 months. In evidence, the respondent called Harshil Kotecha a director of projects. He testified that the claimant was employed on 3 December 2014 and then promoted to general manager on 25 June 2018. Her salary was Ksh. 389,000 per month. Other sister companies paid the claimant, but the respondent had agreed on the gross salary at Ksh. 389,000 per month. At the end of her employment upon resignation, he responded to the claimant with 17 months of unpaid salaries and house allowance. Other employees have also not been paid. Kotecha testified that the respondent has struggled to break even due to financial challenges. One of the reasons for litigation is **Mombasa HCC No. E020 of 2022 KISCOL v CS Treasury & Attorney General** and judgment entered in favour of KISCOL on 5 December 2025 for $185,620,576 plus interest and costs. Additionally, there have been conflicts with local communities, making it difficult for the respondent to grow or harvest the crops the factory needs. On a couple of occasions, the locals have set the respondent’s sugar cane, alleging that the land belonged to them. These problems have resulted in financial losses and made it difficult to pay the employees. A decision was taken to close operations. During the shutdown, some employees would report to check on assets to avoid vandalism. The claimant did not offer her services as alleged. It became difficult to pay salaries. The claimant continued to complain, stating that employees had not been paid. These led to the email dated 24 August 2025, which asked the claimant to resign because it appeared she was completely insensitive to the respondent’s plight. The claimant was eager to find a reason to leave and therefore tendered her resignation. The claim was that she resigned of her own volition. This was accepted. The claims made are meant for unjust enrichment. However, the respondent admits that the claim for 17 months' salary, 27 leave days, and 17 months of unpaid house allowance is due. The parties filed written submissions. **Determination** The employment relationship is not disputed. Indeed, the respondent has admitted that it owes the claimant 17 months' salary, together with house allowances and 27 days of accrued annual leave. Save, the due salary is Ksh. 389,000 and not Ksh. 824,147 as alleged. Thus, the only issue for determination is the correct salary and whether the employment was terminated unfairly. Through a letter of employment offer dated 8 December 2014, the respondent agreed to employ the claimant as the assistant general manager at a salary of Ksh. 307,000 plus Ksh. 40,000 in-house allowance. Total salary is Ksh. 347,000 per month. Through a letter dated 25 June 2018, the respondent promoted the claimant to the position of general manager and increased the salary to Ksh. 349,139, with other conditions of her employment remaining the same. Hence, the house allowance was retained at Ksh. 40,000. Total gross salary at Ksh. 389,139 per month. The claimant asserts that the gross salary was Ksh. 824,147, as there were these deposits in her bank account. The supporting documents in this regard are lopsided bank statements. Only single salary entries are allocated. Ordinary bank statements are not issued in this manner. Every entry is recorded without manipulation. The respondent explained the payments to the claimant as arising from other sister companies, but the salary due was the same, per the letter of employment at Ksh. 349,139 plus due allowance of Ksh. 40,000 total began Ksh. 389,137 per month. Indeed, under section 10(3) of the Employment Act, the employer has a duty to issue the employee with an employment contract. Such a contract should indicate the position held, the place of work and the remuneration. The evidence presented is the claimant's last position, held as general manager, as evidenced by a letter dated 8 December 2018. The gross salary due is Ksh. 389,137 inclusive of house allowance. The salary due for 17 months should thus be tabulated based on the letter dated 8 December 2018. The claim for any salary beyond what is provided in this letter is not justified. The bank statements are not a true reflection of the affairs of the employment relationship. Such bank statements are not a review of the employment letter with additional benefits and are produced in contravention of Section 10 of the Employment Act. The sum of Ksh. 389,137 x 17 = Ksh. 6,615,329 is due as unpaid salary, including house allowance, if not already paid. Leave pay is due based on the basic wage at Ksh. 349,137 for 27 days = Ksh. 313,223.30. On 24 August 2025, the claimant wrote to the respondent attaching her medical summaries and school fees requests. She noted that it had been over a month since her last pay of Ksh. 10,000. Other employees had not been paid. The claimant further noted that the employees were stressed beyond their limits. She noted that: *“… we can best be termed as working enslaved people to KISCOLI.* *We cannot provide food/medication/basic needs for the family. Landlords have locked some houses, so people are sleeping on verandahs or staying with neighbours.* *Some of the children did not attend school last term because the school fees were paid by only a few, despite many requests.”* This email speaks of desperation. Salary had not been paid for 17 months, as admitted. The respondent’s witness admitted that the claimant is indeed owed leave days, a house allowance once, and salary for 17 months. Upon the email on 24 August 2025, the respondent, through Harshil Kotecha, replied that: *“Dear Pamela,* *Stop writing such abusive emails.* *I request you to resign with immediate effect.* *Regards,* *Harshil.”* Harshil testified that he is a director of the respondent. He directed the claimant to resign with immediate effect. Indeed, on 25 August 2025, the claimant tendered her resignation and requested payment of her salary arrears, unremitted statutory deductions, and terminal dues. Under section 44(3) of the Employment Act, an employee or employer is allowed to summarily terminate the employment relationship upon the breach of the employment contract. Sections 17, 18, and 19 require the employer to pay the employee's due salary at the end of the month. Where there is no payment of the due salary, the employer is in breach of a fundamental provision of the employment relationship. The employee is no longer bound under such a contract. A termination of the employment relationship has occurred at the employer's instance due to failure to pay salary for work performed. Where the respondent found itself under financial and operational challenges, there was protection under section 40 of the Employment Act, which was not invoked. Instead, the respondent opted to procrastinate and keep the claim under its employment, resulting in 17 months of salary arrears. In **Sifa Investment Limited v Mutuku [2025] KEELRC 1231 (KLR),** the court recognised that non-payment of salary places the employee in distress and renders him unable to feed himself, leading to a life of indignity. This is aptly captured in **Oweya v Sichangi Partners & Associates Network LLP (Cause E037 of 2021) [2023] KEELRC 1936 (KLR) (27 July 2023) (Judgment).** The court held that: *“The non-payment of salary for work performed and due at the end of the month is not only a serious breach of the employment contract but also undermines the employee's dignity. The employee who wakes up every day to attend work with the legitimate expectation that he has earned his labour and the reward is a salary at the end of the month, is reduced to slavery when such a date arrives, and there is no pay. This is exacerbated where non-payment of the due salary continues beyond the one-month contract period.”* In **Jonathan Spangler v Centre for African Family Studies (CAFS) [2017] eKLR**, the court held that the employee's dignity attached to the salary paid at the end of a hard day cannot be overemphasised. Once the employer fails to pay wages due, for whatever reason, the employee who continues to attend work without knowing when the wages will arrive is subjected to indignity. Well addressed, this is slavery. This is prohibited under articles 28, 30 and 41 of [the constitution](https://new.kenyalaw.org/akn/ke/act/2010/constitution) for breach of the right to dignity, servitude and unfair labour practices. Hence, the claimant's letter dated 24 August 2025 regarding non-payment of her salary for 17 months, together with other employees', can only be viewed as slavery, as indicated. Her frustration is real. Her distress arose from the cumulative efforts in seeking payment of medical bills. School fees requested. These letters are attached to the Memorandum of Claim. In August 2025 alone, the claim had made more than 10 requests for financial assistance, primarily for medical bills. Had the salary been paid on time, such distress would not have arisen. The respondent directed the claimant to resign immediately, which was a culmination of unfair labour practices and contrary to Article 41 of the Constitution, a violation of the right to dignity under Article 28 of the Constitution and Section 17 of the Employment Act. The claim that the termination of employment was unlawful and unfair is correct. The claimant is seeking notice pay at 3 months. However, in the employment contract dated 8 December 2018, read together with the contract dated 3 December 2014, notice pay is due at one month. Notice pay is due at KSh. 389,137. For the unlawful and unfair termination of employment, the claimant has served from December 2014 to August 2025, a period of over 10 years. Taking into account the circumstances leading to the termination of employment, compensation for 5 months is hereby found appropriate at the salary of Ksh. 389,137 x 5 = Ksh. 1,945,685 is due in compensation. On the claim for exemplary damages, the finding above reflects unfair labour practices which are addressed and redressed with compensation. Such shall suffice. Regarding the claim for unremitted statutory dues, they accrue to the statutory body, not the employee. The alternative claim for service pay was not pleaded. On costs, the claim is successful and is necessitated by the conduct of the respondent; costs for the suit are hereby awarded. **Accordingly, judgment is entered for the claimant against the respondent in the following terms:** 1. **The employment was terminated unfairly.** 2. **5 months' compensation Ksh. 1,945,685.** 3. **Notice pay Ksh. 389,137.** 4. **Admitted salary arrears inclusive of house allowance Ksh. 6,615,329, if not paid.** 5. **Admitted accrued leave 27 days Ksh. 313, 223.30.** 6. **Certificate of service shall be issued.** 7. **Costs of the suit.** **Delivered in open court this 29th day of June 2026.** **M. MBARŨ** **JUDGE** **In the presence of:** Court Assistant: Samuel Maruga ……………………………………………… and …………………………………..………….