https://new.kenyalaw.org/akn/ke/judgment/kemc/2026/476

**REPUBLIC OF KENYA** **IN THE CHIEF MAGISTRATES COURT AT MOMBASA** **MAGISTRATES COURT CIVIL** **MCELRC CAUSE NO. E143 OF 2025** **FREDRICK KIBISU SHUGA...……….….……...………………….…………….CLAIMANT** **VERSUS** **REGISTERED TRUSTEES OF THE SALVATION ARMY** **LIKONI CORPS……………………………………………………………….RESPONDENT** **JUDGEMENT** **Introduction** 1. The Claimant commenced these proceedings by a Memorandum of Claim dated 14th February 2025 seeking various remedies arising from the alleged unlawful and unfair termination of his employment. He seeks payment of terminal dues amounting to Kshs. 536,556.61 together with a Certificate of Service, costs and interest. 2. The Respondent entered appearance, filed a Response to the Memorandum of Claim, witness statement and documentary evidence denying liability and contending that the Claimant was lawfully summarily dismissed for gross misconduct. 3. The Claimant testified on 17th November 2025 and closed his case. The Respondent called one witness, Jonathan Nguta, on 16th March 2026, after which the defence case was closed. Parties thereafter filed written submissions. **The Claimant's Case** 1. The Claimant testified that he was employed by the Respondent as a Night Security Guard on 2nd May 2016 under an oral contract earning Kshs. 8,000 per month. 2. His evidence was that on 1st October 2024, after completing his night shift, he was issued with a letter dated 29th September 2024 requiring him to proceed on two months' leave pending investigations. 3. According to him, after expiry of the two months he reported back but was informed by Mr. John Kiama that investigations had not been completed and that he would be contacted. He maintained that he was never recalled to work. 4. His evidence was further that: he never received a show cause letter; he never attended any disciplinary hearing; he never received a termination letter; he was never afforded an opportunity to defend himself. 5. He further testified that throughout his employment: he was underpaid; he never proceeded on annual leave; he was not paid house allowance; statutory deductions were not remitted. He therefore prayed for the reliefs contained in the Memorandum of Claim. **The Respondent's Case** 1. RW1 testified that the Claimant was employed in July 2019 and not in May 2016. He stated that the Claimant repeatedly slept while on duty resulting in theft of church property. According to RW1: the church committee met on 22nd September 2024; the Claimant was placed on investigatory leave; a Show Cause Letter dated 10th October 2024 was issued; the Claimant failed to respond; disciplinary proceedings were conducted on 22nd December 2024; another committee meeting was held on 14th January 2025; the committee found the Claimant guilty of gross misconduct; a termination letter dated 14th January 2025 was issued. The Respondent therefore maintained that termination was both substantively and procedurally fair. **Issues for Determination** 1. Having considered the pleadings, evidence and submissions, the following issues arise: 2. Whether the Claimant proved the date of commencement of employment. 3. Whether the Respondent had a valid and fair reason to terminate the Claimant's employment. 4. Whether the Respondent complied with procedural fairness under the Employment Act. 5. Whether the Claimant is entitled to the remedies sought. **Analysis** Date of employment 1. The Claimant maintains that he commenced employment on 2nd May 2016. The Respondent contends that employment commenced in July 2019. The burden of proving this fact lay upon the parties under sections 107 and 109 of the Evidence Act. 2. The Respondent, despite asserting that employment commenced in July 2019, produced no employment records, payroll, appointment letter, NSSF records, NHIF records or any statutory records to support the alleged commencement date. 3. Sections 10(6) and 10(7) of the Employment Act require an employer to keep written particulars of employment and where such records are not produced, the burden shifts to the employer to disprove the employee's assertions. The Court therefore accepts the Claimant's evidence that employment commenced on 2nd May 2016. Whether there existed a valid reason for termination 1. Sections 43 and 45 of the Employment Act require an employer to prove the reasons for termination. The Respondent relied principally on allegations that the Claimant: slept while on duty; and as a consequence, church property was stolen. 2. The Respondent produced: committee minutes; the leave letter; the show cause letter; minutes of disciplinary meetings; and the termination letter. However, the alleged thefts were never independently investigated. No inventory of stolen property was produced. No police abstract was produced. No investigation report was tendered. No witness who allegedly witnessed the Claimant sleeping testified. 3. The Court therefore finds that while suspicion may have existed, the Respondent failed to adduce cogent evidence proving that the Claimant actually slept on duty or that the thefts occurred as a result of negligence on his part. Accordingly, the Respondent failed to discharge the burden imposed by section 43 of the Employment Act. Whether procedural fairness was complied with 1. This is the central issue in the dispute. The Respondent asserts that: a show cause letter was issued; disciplinary meetings were held on 22nd December 2024 and 14th January 2025; the Claimant attended both meetings but declined to sign the minutes. Conversely, the Claimant denied: ever receiving the show cause letter; attending either disciplinary meeting; receiving the termination letter. The Court has carefully examined the documentary evidence. 2. Firstly, although copies of the show cause letter and termination letter were produced, there is no acknowledgment of receipt by the Claimant. No affidavit of service was produced. No certificate of posting was tendered. No email, WhatsApp communication or SMS confirming service was produced. 3. Secondly, the minutes relied upon merely record that the Claimant was present. They were not signed by him. No explanation was offered as to why attendance registers or independent witnesses were not produced. 4. Thirdly, the Respondent did not call any member of the disciplinary committee apart from RW1 to corroborate attendance. The Court therefore finds that service of the show cause letter and attendance at the disciplinary hearings were not proved on a balance of probabilities. 5. Section 41 of the Employment Act requires an employer to: notify an employee of the allegations; explain the allegations in a language understood by the employee; permit the employee to be accompanied by another employee or shop floor representative; and hear and consider the employee's representations before termination. The Respondent failed to prove compliance with these mandatory requirements. The Court therefore finds that termination was procedurally unfair. Whether termination was unfair 1. Sections 43 and 45 of the Employment Act require both: substantive justification; and procedural fairness. The Court of Appeal in Postal Corporation of Kenya v Andrew K. Tanui [2019] eKLR held that both limbs must be satisfied before termination can be upheld. 2. Similarly, Walter Ogal Anuro v Teachers Service Commission [2013] eKLR emphasized that failure on either limb renders termination unfair. Having found that: the Respondent failed to prove a valid reason; and the Respondent failed to comply with section 41, the inevitable conclusion is that the termination was unfair and unlawful. Remedies 1. Notice pay- The Claimant is entitled to one month's salary in lieu of notice. 2. House allowance- The Respondent pleaded that the salary was consolidated. However, no written contract stating that the salary was consolidated was produced. Section 31 of the Employment Act requires either provision of housing or payment of house allowance. 3. Nevertheless, a claim for house allowance constitutes a continuing injury and, under section 90 of the Employment Act, recovery is limited to the twelve months immediately preceding cessation of employment. The Court will therefore assess house allowance only within the statutory limitation period rather than the thirty-six months pleaded. 4. Underpayment- The Claimant relied upon the Regulation of Wages Orders. The Respondent produced no wage records demonstrating compliance. The Court is therefore satisfied that underpayment was proved. However, as underpayment is also a continuing injury, recovery is limited under section 90 of the Employment Act to the twelve months immediately preceding termination. The claim for thirty-six months cannot therefore succeed in full. 5. Leave pay- The burden of producing leave records lies upon the employer under section 74 of the Employment Act. None were produced. The Court accepts that the Claimant did not proceed on annual leave. 6. However, leave entitlement is likewise subject to section 90 of the Employment Act, and recovery is limited to leave accrued within the statutory period immediately preceding cessation of employment. The claim for three years' accumulated leave therefore cannot be granted in full. 7. NHIF refund- The claim for refund of NHIF contributions is declined. NHIF contributions are statutory payments recoverable by the relevant statutory body and not directly payable to an employee. 8. Service pay- The Claimant pleaded that statutory deductions were not remitted. The Respondent asserted that remittances were made but produced no documentary proof. Where NSSF membership or remittances are not proved, service pay may be awarded under section 35(5) of the Employment Act. On the evidence before the Court, the Claimant is entitled to service pay. 9. Compensation- In assessing compensation under section 49(1)(c), the Court has considered: the Claimant served for approximately eight years; he had a legitimate expectation of continued employment; the Respondent failed to comply with mandatory procedural safeguards; there is no evidence that the Claimant contributed to his dismissal by proven misconduct. The Court considers an award equivalent to eight (8) months' salary to be fair and reasonable. **Final Orders** 1. Judgment is entered for the Claimant against the Respondent as follows: 2. A declaration that the termination of the Claimant's employment was unfair and unlawful. 3. Underpayments recoverable only within the statutory limitation period under section 90 of the Employment Act, to be computed in accordance with the applicable Regulation of Wages Order. Based on the pleadings and the applicable Regulation of Wages (General) (Amendment) Order, 2022 (Legal Notice No. 125 of 2022), the Claimant pleaded that he was paid Kshs. 8,000.00 per month while the prescribed minimum wage for a Night Guard in Mombasa was Kshs. 16,959.90. Applicable monthly minimum wage 16,959.90 Actual monthly salary (8,000.00) Monthly underpayment 8,959.90 Monthly underpayment 8,959.90 Recoverable period 12 months **Total underpayment: 8,959.90 × 12= 107,518.80** 1. One month's salary in lieu of notice – The Claimant is entitled to one month's salary in lieu of notice pursuant to sections 35 and 36 of the Employment Act. Having found that the Claimant was remunerated below the prescribed minimum wage, the Court is satisfied that the notice pay should be computed on the statutory minimum wage applicable at the time of termination. An employer cannot benefit from an unlawful wage by using it as the basis for computing terminal dues. Accordingly, the Claimant is awarded **Kshs. 16,959.90** being one month's salary in lieu of notice. 2. House allowance- Having found that the Claimant was remunerated below the prescribed minimum wage, the Court is of the view that the computation of house allowance should be based on the lawful wage applicable under the Regulation of Wages Order and not on the unlawfully depressed salary actually paid. An employer cannot rely on an illegal wage to diminish an employee's entitlement to house allowance under section 31 of the Employment Act. Accordingly, the Court computes house allowance at 15% of the applicable minimum monthly wage of Kshs. 16,959.90, amounting to Kshs. 2,543.99 per month. Since the claim constitutes a continuing injury, recovery is limited by section 90 of the Employment Act to the twelve months immediately preceding the cessation of employment. The Claimant is therefore awarded **Kshs. 30,527.88** under this head. 3. Leave pay- On the claim for annual leave, the Respondent did not produce leave records as required under sections 28 and 74 of the Employment Act to demonstrate that the Claimant proceeded on annual leave. The Court therefore finds that the Claimant is entitled to payment in lieu of accrued leave. However, the claim is subject to the limitation prescribed under section 90 of the Employment Act, and recovery is limited to the leave accrued within the twelve months immediately preceding the cessation of employment. Having found that the applicable monthly wage was Kshs. 16,959.90, the daily rate is Kshs. 652.30 (16,959.90 ÷ 26). The value of 21 leave days is therefore **Kshs. 13,698.30**, which sum is awarded under this head. 4. Service pay- The Respondent pleaded that statutory deductions were remitted but did not produce any NSSF statements, remittance schedules or other documentary evidence to demonstrate that the Claimant was a contributor to the National Social Security Fund. The burden of proving the exception under section 35(6) of the Employment Act rested upon the Respondent. In the absence of such proof, the Court finds that the Claimant is entitled to service pay under section 35(5) of the Act. Applying the conventional measure of 15 days' wages for each completed year of service, and using the lawful monthly wage of Kshs. 16,959.90, the Court awards the Claimant **Kshs. 78,276.00** for 8 completed years of service. 5. Compensation for unfair termination equivalent to eight (8) months' salary – Kshs. 64,000.00. 6. The claim for refund of NHIF contributions is dismissed. 7. The Respondent shall issue the Claimant with a Certificate of Service within thirty (30) days. 8. The Claimant shall have the costs of the suit. 9. The decretal sum shall attract interest at court rates from the date of judgment until payment in full. **Final Disposition** 1. In the result, judgment is hereby entered for the Claimant against the Respondent as follows: 2. A declaration be and is hereby issued that the termination of the Claimant's employment by the Respondent was unfair and unlawful within the meaning of sections 41, 43 and 45 of the Employment Act, 2007. 3. The Claimant is awarded one (1) month's salary in lieu of notice in the sum of Kshs. 16,959.90. 4. The Claimant is awarded underpayments for the twelve (12) months immediately preceding the termination of his employment in the sum of Kshs. 107,518.80. 5. The Claimant is awarded house allowance for the twelve (12) months immediately preceding the termination of his employment in the sum of Kshs. 30,527.88. 6. The Claimant is awarded payment in lieu of accrued annual leave in the sum of Kshs. 13,698.30. 7. The Claimant is awarded service pay equivalent to fifteen (15) days' wages for each completed year of service, amounting to Kshs. 78,276.00. 8. The Claimant is awarded compensation for unfair termination equivalent to eight (8) months' gross salary, calculated on the applicable statutory minimum wage of Kshs. 16,959.90, amounting to Kshs. 135,679.20. **Total award: 382,660.08** 1. The claim for refund of NHIF contributions is declined. 2. The Respondent shall issue the Claimant with a Certificate of Service in accordance with section 51 of the Employment Act, 2007, within thirty (30) days from the date of this Judgment. 3. The Claimant shall have the costs of the suit. 4. The decretal sum shall attract interest at court rates from the date of this Judgment until payment in full. It is so ordered. **DATED, SIGNED AND DELIVERED ONLINE VIA MICROSOSFT TEAMS AT MOMBASA THIS 30TH JULY 2026.** **……………………………………………….** **EMILY M. MWAMUYE** **SENIOR RESIDENT MAGISTRATE**