https://new.kenyalaw.org/akn/ke/judgment/keca/2026/1600

Selecta Kenya GMBH & Co KG v Gurevich (Civil Appeal E713 of 2021) [2026] KECA 1600 (KLR) (31 July 2026) (Judgment) Neutral citation: [2026] KECA 1600 (KLR) Republic of Kenya In the Court of Appeal at Nairobi Civil Appeal E713 of 2021 S ole Kantai, AO Muchelule & P Lilan, JJA July 31, 2026 Between Selecta Kenya Gmbh & Co KG Appellant and Yaron Gurevich Respondent (An appeal from the Judgment of the Employment and Labour Relations Court at Nairobi (Makau, J) dated 29th October 2021 in ELRC Cause No. 255 of 2020) Judgment 1.This appeal arises from the decision of the Employment and Labour Relations Court at Nairobi, (O.N Makau, J.) dated 29th October 2021, in which the learned Judge found that the dismissal of the Respondent via letter dated 27th March 2002 was unfair and unlawful within the meaning of Section 45 of the Employment Act. 2.In his statement of claim before the trial court, the respondent stated that vide a contract dated 15th September, 2016, the appellant employed him as its general manager earning an initial annual salary of €84,000.00, among other benefits. The monthly payment of the said salary was divided into two so that one half thereof, that is to say €3,500 was paid by Selecta Klemm in Germany and the other half , ie € 3,500 was paid by the appellant. The respondent’s salary was later increased to €85,200.00 annually, paid in equal monthly installments of €7,100.00 which arrangement was subsisting as at the time of termination of his employment. 3.The genesis of the dispute which eventually escalated to this court for resolution through the extant appeal is that the respondent reported to work as usual on the morning of 27th March 2020 only to be served with a letter terminating his employment effective 30th September 2020. In the said letter , he was offered payment in lieu of notice and directed to surrender all company property, including car keys and a laptop, which he did. 4.The respondent further averred that following his exit under those circumstances, the appellant later issued him a show cause letter on 2nd June 2020, stipulating alleged acts of misconduct that supposedly occurred in 2019. The said letter further directed the respondent to submit his response by 8th June 2020. The appellant thereafter issued the respondent a letter terminating his services summarily on the grounds of gross misconduct, to wit, burning company documents in 2019. 5.The respondent moved to the Employment and Labour Relations Court ( ELRC) , filed his claim, and sought the following reliefs against the appellant;a.A declaration that the termination herein was unfair and unlawful;b.Payment of Kshs 9,704,460.16 as particularized in paragraphs 23 and 25 of the claim;c.12 month’s salary for unfair and unlawful termination of employment pursuant to section 49(1) (c) of the Employment Act,2007 amounting to € 85,200.00 (Kshs. 10,319,536.24 as per the Key CBK indicative exchange Rate as at 12th June 2020;d.A certificate of Service;e.Costs of the Suit;f.Interest on (b) and (c) above at court rates from the date of filing suit until payment in full;g.Any other relief(s) this Honourable court may deem fit to grant in the circumstances. 6.In its statement of response, the appellant denied the alleged unfair termination and averred that the respondent’s employment had been terminated for having an unwarranted relationship with a female member of staff and for destroying company documents without authority. It was also averred that the respondent was invited to show cause, which he declined and instead sued the company.7.The cause was canvassed by way of oral evidence and production of exhibits. In support of his claim, the respondent stated that he had served as the appellant’s general manager from 2016 until the sudden termination of employment on 27th March 2020. He described being ambushed at work by his junior managers, who served him with a dismissal letter signed by the Chief Executive Officer (CEO), after which he was asked to surrender all company property and was thereafter escorted home in a pickup. The respondent maintained that no reasons were cited in the letter, and no disciplinary hearing was conducted before his exit. 8.Regarding the allegations of misconduct, the respondent denied having a romantic relationship with a subordinate, one Anne Obura, and while he admitted to authorizing the burning of company documents, he maintained that they were 10-15- year-old documents that had been damaged by rats; that he had authority to dispose of such documents. He also confirmed receiving only two months of the six months' salary in lieu of notice promised in the letter of termination of his employment. 9.DW1, Virginia Wamaitha Gitonga, who succeeded the claimant as general manager, testified for the appellant. She stated that the respondent was dismissed for gross misconduct and insubordination. Specifically, the witness testified that the respondent maintained an unauthorized relationship with a subordinate and failed to follow a direct instruction from the appellant’s CEO to dismiss her. The witness testified that upon taking office, she discovered that stored requisition books had been burnt on the respondent’s instructions, a matter she reported to the police. 10.In cross-examination, the witness admitted that no warning letter had been issued to the respondent before the March termination and that the dismissal letter was entirely silent on the reasons for the action, making no mention of sexual harassment or the burnt documents. The witness contended that the respondent remained an employee until June 2020, because the original termination letter offered payment through September, thereby justifying the subsequent summary dismissal. 11.At the conclusion of the trial, the trial Judge found in favour of the respondent. The Court held that the dismissal of the respondent through the letter dated 27th March 2020 was unfair and unlawful within the meaning of section 45 of the Employment Act. The Court also observed that the termination letter cited no reasons, and no hearing was accorded to the respondent prior to the said decision. Additionally, the court held that the subsequent summary dismissal in June 2020 was null and void because the contract of service had already been terminated in March. Consequently, the trial Court awarded the respondent a total of €88,992.00 for payment in lieu of notice, compensation, leave and bonus, plus Kshs 750,000/- for house allowance. 12.Aggrieved by the trial court’s decision, the appellant filed this appeal, raising six (6) grounds of appeal. The appellant contends that the Judge erred;i.In matters of law and fact in sufficiently not appreciating or failing to consider the Appellant’s Evidence produced during trial, and as a consequence awarding the Respondent a total sum of Euros 88,992 with interest.ii.By misdirecting himself to the material facts and circumstances in finding that SELECTA KENYA GMBH & CO.KG and SELECTA KLEMM GMBH & CO.KG are liable, as a consequence of the foregoing the appellant was liable to a contract between the Respondent and SELECTA KLEMM GMBH & CO.KG who is not a party to the proceedings herein.iii.By allowing the Respondent’s claim as pleaded and awarding the Respondent a sum of Kshs. 750,000.00 with interest despite the evidence on record indicating that the Appellant had paid the house allowance for a period of six months.iv.By not sufficiently appreciating or at all ignoring the Appellant’s testimony and material evidence in support thereto adduced during trial and as a result passed the impugned judgment and decree in favour of the Respondent.v.In arriving at the impugned decision that is wholly and substantially against the evidence on record.vi.In law and misdirected himself against the weight of the evidence on record in finding that the Appellant unfairly and unlawfully dismissed the Respondent from employment. 13.The appeal was canvassed by way of written submissions, which were fully adopted by learned counsel Mr. Waweru Thiong’o for the appellant and Mrs. Lingunya for the respondent, without highlighting, save for admission by counsel for the appellant, that there was a lapse in procedure in the manner in which the respondent’s employment was terminated for failure to accord him a hearing. 14.In its written submissions dated 12th April 2023, the appellant submitted that the respondent was summarily dismissed for failing to obey a lawful command from the CEO to dismiss a subordinate staff member. It was submitted that the respondent acknowledged this instruction, but failed to carry it out, which constituted gross misconduct under section 44 of the Employment Act. 15.Concerning procedural fairness, the appellant submitted that the respondent was issued various verbal and written warnings before the March dismissal letter and thus the termination was not unlawful. 16.It is also submitted that the trial Court erred by holding the appellant liable for a contract between the Respondent and Selecta Klemm GmbH & Co. KG, a German company that was not a party to the proceedings. The appellant maintains that the Respondent was only bound by his contract with the Appellant entity. The appellant placed reliance on the principle that a court cannot rewrite a contract for parties and cited the case of National Bank of Kenya Ltd vs Pipeplastic Samkolit (K) Ltd & Another (2001) eKLR to support this submission. 17.On the damages awarded, the appellant submitted that the court erred in awarding Kshs 750,000/- as documentary evidence showed that the appellant had already paid house allowance in full until September 2020. 18.The respondent urges this Court to dismiss the appeal. In his written submissions dated 19th September 2023, the respondent maintains that the termination letter of 27th March 2020 was silent on reasons, and characterizes the subsequent allegations of burning documents as a malicious afterthought. The respondent has placed reliance on the case of Pius Machafu Isindu vs Lavington Security Guards Limited (2017) eKLR on the employer's statutory duty to prove valid reasons for termination. 19.Regarding the two contracts, the respondent asserts that both agreements were for his role as general manager of the appellant company. 20.Concerning the house allowance, the respondent points to a letter dated 15th June 2020 wherein the Appellant terminated the tenancy agreement with his landlord with immediate effect, thereby stopping rent payments and justifying the court’s award for unpaid allowance. 21.Being a first appeal, this Court in J. S. M. v E. N. B. [2015] eKLR aptly put our role as a first appellate Court as follows:-“We shall however bear in mind that this Court will not lightly differ with the trial court on findings of fact because that court had the distinct advantage of hearing and seeing the witnesses as they testified and was therefore in a better position to assess the extent to which their evidence was credible and believable. Should we however, be satisfied that the conclusions of the trial judge are based on no evidence or on a misapprehension of the evidence on record or that the learned judge demonstrably acted on wrong principles, we are enjoined to interfere with those conclusions.” 22.We have considered the record in light of our mandate as set out above, the rival submissions and principles of law relied upon by the respective parties. The issues that fall for our determination are therefore;i.Whether the summary dismissal of the respondent was unlawful, unprocedural, and unjustified.ii.If so, what reliefs is the respondent entitled to? 23.With regards to the first issue, since it is not disputed that the employer/ employee relationship subject to this appeal was subject to the Employment Act, the procedure for terminating employment which the appellant ought to have followed when terminating the respondent’s employment is set out in sections 41,43 and 45 of the Employment Act, which provides as follows;“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.” 24.This procedure has been constructed as a mandatory process, and this Court summarized the parameters to be followed in termination of employment in the case of Janet Nyandiko versus Kenya Commercial Bank Limited [2017] eKLR as follows;Section 45 of the Act makes provision inter alia that no employer shall terminate the employment of an employee unfairly. In terms of the said section, a termination of an employee is deemed to be unfair if the employer fails to prove that the reason for the termination was valid; that the reason for the termination was a fair reason and that the same was related to the employee’s conduct, capacity, compatibility or alternatively that the employer did not act in accordance with justice and equity.The parameters for determining whether the employer acted in accordance with justice and equity in determining the employment of the employee are inbuilt in the same provision. In determining either way, the adjudicating authority is enjoined to scrutinize the procedure adopted by the employer in reaching the decision to dismiss the employee; the communication of that decision to the employee and the handling of any appeal against the decision. Also not to be overlooked is the conduct and capability of the employee up to the date of termination, the extent to which the employer has complied with the procedural requirements under section 41, the previous practice of the employer in dealing with the type of circumstances which led to the termination and the existence of any warning letters issued by the employer to the employee.Section 41 of the Act, enjoins the employer in mandatory terms, before terminating the employment of an employee on grounds of misconduct, poor performance or physical incapacity to explain to the employee in a language that the employee understands the reasons for which the employer is considering to terminate the employee’s employment with them. The employer is also enjoined to ensure that the employee receives the said reasons in the presence of a fellow employee or a shop floor union representative of own choice; and to hear and consider any representations which the employee may advance in response to allegations leveled against him by the employer.” 25.None of the above procedures was outlined by DW1 as having been undertaken by the appellant before terminating the respondent’s employment. The trial court examined the termination letter dated 27th March 2020 and stated as follows;The above letter is silent on the reason for the dismissal of the claimant and there is no mention of any hearing accorded to the claimant before the termination. There is no indication whether the reason for the termination was the alleged relationship with the female employee or the failure to fire the female employee as directed by the CEO. The respondent has also failed to prove that the alleged relationship between the claimant and Anne Obura was true after the claimant denied the same. Further the respondent has failed to prove that the command given to the claimant by the CEO was lawful and justified. Consequently I hold that there was no valid and fair reason for dismissing the claimant on 27.3.2020 26.We similarly find so, indeed, the termination letter of 27th March 2020 did not contain reasons for the dismissal, and there was also no hearing held before the same was issued. The contention by the appellant that it invited the respondent to show cause vide its letter of 2nd June 2020 was indeed an afterthought. The same was issued after the respondent’s services had already been terminated. 27.We therefore find no basis for interfering with the Judge’s finding that the procedure employed by the appellant to terminate the respondent’s employment was unprocedural. 28.On the second issue, the trial court awarded compensation for salary in lieu of notice, compensation for leave, and a bonus in the sum of €88,992, as well as a house allowance at Kshs 750,000/- The appellant took issue with all monetary awards. 29.The trial Court however, justified these awards as follows; the respondent was not paid the outstanding four months’ notice pay, as he was only paid two months instead of the required six months. The six months’ pay in lieu of notice was originated by the appellant itself in its letter of 22nd March 2020. The court also awarded outstanding house allowance following evidence that the appellant had stopped paying rent as communicated in its letter dated 15th June 2020 to the respondent’s landlord, as well as a claim for leave days, which was not disapproved. 30.The trial Court also awarded the respondent 6 months' salary for unfair termination. The remedies for wrongful dismissal and unfair termination are provided for in section 49 as read with section 50 of the Employment Act. Among them is an award of "the equivalent of a number of months wages or salary not exceeding twelve months based on the gross monthly wage or salary of the employee at the time of dismissal.” This is what the trial court awarded under section 49 (1) (c). Additionally, section 49(4) sets out several factors which should be taken into account in deciding whether to recommend the remedies, and the trial Court gave its considerations as follows;“I have considered that the claimant worked for 3 years scoring very high-performance rating which earned him bonuses as evidenced by the email from the CEO dated 9.3.2020. I have also considered that the claimant did not cause his dismissal through misconduct. Finally, I have considered that from the date of dismissal, he did not secure any other employment.” 31.Additionally, these sums were based on the contract dated 15th September 2016. In the end, we find no basis for interfering with the discretionary monetary reliefs awarded by the trial court and uphold the same as the trial judge exercised discretion within the boundaries prescribed by the law. 32.The result is that we dismiss the appeal. The appellant shall pay the respondent the costs of the appeal.Orders accordingly. DATED AND DELIVERED AT NAIROBI THIS 31ST DAY OF JULY, 2026S. ole KANTAI............................. JUDGE OF APPEALA.O. MUCHELULE........................... JUDGE OF APPEAL PAUL LILAN………………………JUDGE OF APPEALI certify that this is a true copy of the originalSigned DEPUTY REGISTRAR.