https://new.kenyalaw.org/akn/ke/judgment/keelrc/2026/1594

Trustgro Sca Ltd v Gichana (Appeal E154 of 2024) [2026] KEELRC 1594 (KLR) (12 June 2026) (Judgment) Neutral citation: [2026] KEELRC 1594 (KLR) Republic of Kenya In the Employment and Labour Relations Court at Nairobi Appeal E154 of 2024 NJ Abuodha, J June 12, 2026 Between Trustgro Sca Ltd Appellant and Albert Gerald Gichana Respondent (Being an appeal from the Judgment of Principal Magistrate’s Court at Nairobi (Honourable H.M. Ng’ang’a) delivered on 25th April, 2024 in MCELRC E1435 of 2022) Judgment 1.Through the Memorandum of Appeal dated 24th May, 2024 the Appellant appeals against whole of the Judgment of Principal Magistrate’s Court at Nairobi (Honourable H.M. Ng’ang’a) delivered on 25th April, 2024 in MCELRC E1435 of 2022 on grounds inter alia:1.The learned magistrate erred in law and in fact by finding that the Respondent was constructively dismissed but failed to take into consideration the resignation that the respondent had issued.2.The Learned magistrate erred in law and in fact by finding that the appellant was discriminated against on the ground that his colleagues were paid extra remuneration for carrying out management accountant duties when on the contrary the trial magistrate made finding that the Respondent failed to demonstrate that the said colleagues were paid extra amounts.3.The trial magistrate erred in law and fact by awarding the Respondent terminal dues of salary post probation when there was no such agreement to increase salary after probation.4.The trial magistrate erred in law and fact by making assumption that salary was automatically reviewed upon confirmation when there was no such agreement to increase salary after probation.5.The trial court erred in law and in fact by finding that the Respondent was discriminated without considering evidence tendered by the Appellant 2.The Appellant consequently prayed that the appeal be allowed and the judgment by learned Magistrate delivered on 25th April, 2024 in MCELRC E1435 of 2022 be set aside in terms of prayers a,b, c, d and e. The appellant further prayed for the costs of the appeal. 3.The Appeal was disposed of by written submission Appellant’s Submissions 4.The Appellant’s Advocate, Mr. Ochieng’ submitted a submitted among others that the trial court lacked jurisdiction to hear the matter in that the respondent’s salary was more than Kshs. 80,000/- per month contrary to Gazette Notice Number 6024 which designated special magistrates to hear employment disputes where the employee’s salary did not exceed Kshs. 80,000/-. According to counsel, the respondent’s salary was Kshs. 154, 447/- per month as the time of the alleged termination. As a result Counsel submitted that the entire suit and consequently the judgment delivered on 25th Appril, 2024 was void ab initio. In this respect, counsel relied on the case of Ndwiga v. Promosidor Kenya Ltd KEELRC 237 (KLR). 5.On the issue of constructive dismissal, counsel submitted that the legal test for constructive dismissal was laid down in the case of Western Excavating ECC Ltd v. Sharp [1978] 2 WLR and later in the case of Coca Cola East & Central Africa Ltd v. Maria Kagai Lugaga [2015] eKLR. He further submitted that to establish constructive dismissal, it was incumbent on the employee to prove that the employer was guilty of a conduct which was significant breach going to the root of the contract of employment. The breach must be fundamental as to be considered a repudiatory breach and the employee must resign in response to that breach. Counsel further submitted that section 47(5) of the Employment Act places the burden of proving unfair termination that on the employee, while the employer must justify the grounds for termination. Mr. Ochieng’ submitted that the trial court erroneously concluded that the respondent was constructively dismissed, failing to take into account clear evidence of voluntary resignation. The respondent resigned on his own volition citing personal reasons and not a direct consequence of an intolerable environment created by the appellant. According to counsel therefore the legal test for constructive dismissal was therefore not met by the respondent. 6.Concerning the events preceding the alleged resignation, counsel submitted that the respondent had earlier faced lawful disciplinary procedure between 2021 and 2022 for misconduct, specifically, wilful and habitual absence and lateness from work and insubordination. He was found guilty of the charges on 19th November, 2021. According to counsel, the resignation was tactful to avoid lawful discipline process and that the learned trail magistrate failed to apply the objective test established in the Coca Cola case and ignore the principle discouraging employees from using resignation to defeat lawful disciplinary process. In this respect, counsel cited the case of Peter Njuguna Chege v. Timsales Civil Appeal No. NAK 29 of 2020. 7.On the issue of discrimination, counsel submitted that section 5(3) of the Employment Act places the initial burden on an employee to demonstrate the facts from which discrimination may be inferred after which the employer is called upon to justify the conduct. According to counsel, the respondent, neither pleaded nor proved any specific ground of discrimination recognised by the Act. His claim was merely that his salary was lower than that of his colleagues and that disciplinary action was unfairly directed at him. According to counsel, such generalised grievances do not amount to discrimination in law. There was absolutely no ground for existence of such discrimination since such generalised grievances did not amount in law to discrimination. Counsel submitted that whilst the respondent claimed that there was an uncommunicated policy of compensating other members of the Finance Department for the Management Accountants’s duties performed yet he was excluded, he did not provide at the trial any payslip from these other colleagues to vouch for this. In this respect, counsel relied on the case of Ogila v. Dawa Life Science Limited Cause E598 of 2022 and the case of Ol Pejeta Ranching Limited v. David Wanjau [2017] where the court stated that in claims for equal pay for work of equal value, there is always need on the part of the claimant to establish comparators for purposes of showing unequal pay in comparison to the comparators. 8.On the issue of the award of terminal dues, Counsel submitted that under section 10(2)(h) and (5) of the Employment Act, the terms relating to remuneration and its review must be expressly stated in writing and that any change or review in remuneration must be expressly agreed upon in writing. However, the respondent never produced in writing, any addendum, letter or payslip evidencing such increment. The respondent’s contract dated 16th September, 2015, clearly stipulated under clause 7.1 that any review or increment would be at the discretion of the employer and subject to performance and company policy. According to counsel, the respondent’s payslips on record demonstrated consistent salary with increase from the probation period to employment period and also annual increment until the point of his resignation. From the respondent’s pleadings, it was evident that he was remunerated in time and even awarded a 13th cheque every year. Mr. Ochieng’ further submitted that the Courts have always upheld the sanctity of employment contracts and could not impose new terms not agreed upon by the parties. Counsel in this regard relied on the case of Registered Trustees of the Presbyterian Church of East Africa & Another v. Ruth Gathoni Ngotho-Karuiki [2017] KECA 194 (KLR). Counsel therefore submitted that the learned trial magistrate erred in law and fact by awarding the respondent terminal dues on the presumption that his was automatically increased after probation despite no contractual or evidential basis for such finding. Respondent’s Submissions 9.Counsel for the respondent Mr. C. Ochieng’ submitted among others that the issue of jurisdiction of the trail court was an afterthought since it ought to have been raised and determined at the earliest opportunity based on the pleadings and not premised on selective post-hoc arithmetic drawn from fluctuating payslip entries. According to counsel, at the time the respondent left employment, his monthly salary, excluding nonguaranteed discretionary pay, was Kshs. 75,900, a fact the appellant never controverted. According to counsel, the appellant was no on appeal trying to lump together non-discretionary overtime payments and one-off allowances to manufacture jurisdictional issues on appeal. According to counsel, the Gazette Notice Number 6024 of 22nd June, 2018 relied upon ‘gross monthly pay’ as a jurisdictional guide. It did not elevate irregular, discretionary, or contingent payments into permanent jurisdiction-ousting factors. Overtime and incentive payments made to the respondent in May, August and December, 2021 were by their nature variable and could not be used to retrospectively defeat jurisdiction. 10.On the issue of constructive dismissal, counsel submitted that the appellant’s counsel deliberately isolated the respondent’s resignation letter from the factual matrix preceding it in a bid to distort the narrative. According to counsel, constructive dismissal is not negated merely because an employee tenders a resignation. The Court must interrogate the circumstances leading to the resignation. In this regard counsel relied on Cola East & Central Africa Ltd case cited by the appellant. On the unreasonable test, counsel submitted that the trial court established that the acts by the appellant towards the respondent were so unreasonable that the respondent was entitled to leave employment. In order to justify the contention, counsel submitted that the respondent was remunerated unequally for equal work taken over from the management accountant. According to Mr. Ochieng’, the Finance Department held a meeting on 19th April, 2021 where one of the agendas was transition and distribution of duties and another agenda was compensation for extra tasks. Under the first agenda, members were notified that the appellant had decided that the outgoing Management Accountant’s role would be spread across members of the finance department and other the other agenda, it was resolved that the outgoing Management Accountant’s pay would be spread across members of the team for the extra roles there would be handling. It was contended by counsel that as a result, the respondent took trouble and learned privately at his house and trained all the other members of the finance department and executed the roles assigned with BR receipt postings. The respondent however learnt later in June, 2021 that some members of the department were being compensated for the extra roles yet he was not. The respondent thereafter demanded a meeting to understand why he was not remunerated like the rest and one was convened on 26th October, 2021 where he was informed that indeed the extra incentives were paid for the extra roles to his colleagues. The head of finance however resisted similar payment to him and alleged that in his case the extra payment was on account of overtime. 11.On the issue of a disciplinary hearing whose outcome was unfair, counsel submitted that the trial magistrate rightly established that the respondent had been subjected to a disciplinary hearing whose outcome was manifestly unfair and therefore unreasonable. According to counsel the hearing was precipitated by his own follow up on the discriminatory treatment in the finance department where other were secretly compensated for extra work at his. Exclusion. The respondent was found guilty of insubordination for being away from work on 3rd November, 2021 yet in the notification for hearing on the allegations for insubordination was backed by his absence from work on 29th October, 2021 which ironically was established during the same hearing to have been approved by the manager. Further, the appellant’s line manager issued the respondent with a “final written warning” contrary to the finding and recommendations of the hearing that he be issued with “a warning letter”, a fisrt of the three before an employee is issued with a final warning letter. This according to counsel, put the respondent on the edge of a dismissal. 12.Mr. Ochieng’ further submitted that the trial magistrate noted that the respondent was made to hand over his duties without proper reassignment, leaving him in a position of uncertainty. According to counsel, the respondent on 14th November, 2021 wrote the appellant’s CEO complaining about unprocedural reassignment of his duties because without being allocated other duties and therefore being sidelined in the pretext of discretion by the head of finance department. The respondent even suggested to move to a different division or be laid off instead of being treated in the manner in which he was being treated by the head of finance. This email triggered the appellant to further and more new staff were brought into the department and the respondent tasked to train them and hand over his duties to them. 13.According to counsel, despite lamenting about his predicament to the CEO and line manager, the requests by the respondent were denied and was left without a role for 6 months as he waits for a disciplinary process to run its course yet the process had been completed and recommendations made. 14.Concerning the issue of discrimination, counsel submitted that this claim was not based on abstract salary dissatisfaction but on demonstrable discriminatory employment practice where other members of the Finance Department were compensated for management accountant duties while the respondent who performed similar duties was excluded. According to counsel, the exclusion of the respondent from the compensatory scheme while the rest were compensated was in the counsel’s view discriminatory. Further, the insistence by the appellant that the respondent produces his colleagues payslips ignored the statutory burden on employers under section 5(7) of the Employment Act that once the respondent demonstrated differential treatment, the burden shifted to the appellant to justify the exclusion and that the appellant failed to do so. Further, the appellant was the custodian of employment records including the payslips of the 5 members of the finance team who were present at the meeting on 19th April, 2021 and just as it had difficulty in producing the respondent’s payslip, it should have produced the payslip of the other four employees and the policy document for incentive payments to justify the differential and unequal treatment meted out to the respondent. Distinguishing the Ol Pejeta case, counsel submitted that the comparator must exist and that a hypothetical employee was not permissible and that normally a comparator would be an employee doing the same job or a job of equal value at the same time. 15.On the issue whether the trial court erred in awarding the respondent assumed post probation or confirmation of salary without any supporting evidence, counsel submitted that the respondent’s initial contract expressly provided for a probationary period of three months extendable by a written notice. It was not disputed that no notice of extension of probationary period was ever issued hence the respondent was deemed to have been confirmed into employment. The trial court therefore did not invent the salary increment but merely enforced what was agreed to become salary payable upon confirmation. DETERMINATION 16.The court has considered the grounds in the Memorandum of Appeal, the Record of Appeal and the submissions filed by the parties herein and authorities relied on and would as usual state that it is now settled law that the duty of the first appellate court is to re-evaluate the evidence in the subordinate court both on points of law and facts and come up with its own findings and conclusions as was held in the often-cited case of Selle vs Associated Motor Boat Company Limited [1968] E.A 123 where it was stated thus:-An appeal to this court from a trial by the High Court is by way of retrial and the principles upon which this court acts in such an appeal are well settled. Briefly put they are that this court must reconsider the evidence, evaluate it itself and draw its own conclusions though it should always bear in mind that it has neither seen nor heard the witnesses and should make due allowance in this respect. In particular, this court is not bound necessarily to follow the trial judge’s findings of fact if it appears either that he has clearly failed on some point to take account of particular circumstances or probabilities……..or if the impression based on the demeanour of a witness is inconsistent with the evidence in the case generally.”And further in the case of Abok James Odera t/a A.J Odera & Associates v John Patrick Machira t/a Machira & Co. Advocates [2013] eKLR, where it was stated that:-“This being a first appeal, we are reminded of our primary role as a first appellate court namely, to re-evaluate, re-assess and reanalyze the extracts on the record and then determine whether the conclusions reached by the learned trial Judge are to stand or not and give reasons either way.” 17.The Judgment of the trial court was that the appellant’s claim before the trial court was dismissed after that court found that the respondent was constructively dismissed and further that the appellant discriminated against the respondent on the grounds that his colleagues were paid extra remuneration for carrying out management accountant duties while he was not. The Court however noted the respondent did not demonstrate that the said colleagues were paid extra amounts. The trial court further awarded the respondent terminal dues based on post probation salary. 18.The appellant feeling aggrieved by the finding of the trial court, brought the present appeal against the entire judgment of the trial court and urged that the same be set aside in its entirety and be replaced with a judgment allowing the appeal and dismissing the respondent’s claim in its entirety and award the appellant the costs of the appeal. 19.As observed above concerning the role of this court as a first appellate court, its primary role is to re-evaluate, re-assess and reanalyse the extracts on the record and then determine whether the conclusions reached by the learned trial court are to stand or not and give reasons either way. The Court as an appellate court is further reminded not to replace its own opinion of what could have been a better interpretation and ultimate finding on the facts before the trial court if those facts and evidence, align with reasonable conclusions over the issues in dispute and are supported by law. 20.The main issue in this appeal in the court’s view is whether the trial court erred in finding that the respondent was constructively dismissed and further whether the trial court was right in holding that the respondent was discriminated against by finding that whereas the responsibilities of management accountant was distributed among his colleagues as well as to himself, it was discriminatory for the appellant to pay his colleagues extra compensation for the additional responsibilities to his exclusion. 21.On these issues, it would be important to examine the findings of the trial court thereon vis à vis the evidence tendered. On the issue of discrimination, the trial court rendered itself as follows:‘…the claimant alleges that he was excluded from the extra payments made to his work colleagues…for performing the duties of the management accountant, even though he had taken it upon himself to learn the role and train his colleagues in the absence of proper instructions from his superiors. The respondent in this respect relied on the case of Ol Pejeta Ranching Limited v. David Wanjau [2017]eKLR…it is my view that counsel for the respondent is misguided in relying on the same; whereas the claimant claims for equal pay for equal work, evidence has been produced to show that extra work was indeed assigned across the department. However, the claimant did not receive extra payment in accordance with the outcome of the meeting, or similar to his colleagues who were paid extra-which would consequently serve as a comparator…furthermore, section 5 of the Act imposes a burden on the respondent to prove that this discrimination did not take place. Section 74 places a burden on employees (sic) to provide employment records; payslips would be readily available to the respondent, and it should have demonstrated through payslips that indeed the claimant was not paid less for the extra work he has demonstrated to have been assigned just like his colleagues…consequently I find that the respondent failed to show that discrimination did not happen and find favour in favour of the claimant…” 22.As rightly pointed by the trial court, section 5(3) of the Employment Act interdicts discrimination of employees in respect of recruitment, training, promotion, terms and conditions of employment, termination or other matters arising out of employment. Further, section 5(7) provides that in any proceedings where a contravention of this section is alleged, the employer shall bear the burden of proving that the discrimination did not take place as alleged, and that the discriminatory act omission is not based on any of the grounds specified in this section. A plain interpretation of these two sections is that discrimination in any form is not allowed in employment relationship whether potential or actual, second, in any proceedings where discrimination is alleged, the employer assumes the responsibility of proving that the discrimination did not take place as alleged. Section 107 of the Evidence Act however provides that whoever desires any court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts must prove that those facts exist. Implicit in this provision is that an allegation must not be bare. It must be supported by facts or evidence. It would not only yield undesirable consequences and not the intention of the drafters of section 5 of the Employment Act, but also absurd that all an employee or a potential employee needs to do is to allege that he or she has been discriminated without backing such allegation with at least a modicum of factual evidence. 23.In this particular case, the respondent alleged that he was discriminated by the appellant when he discovered that despite the fact that he was performing management accountant functions as his colleagues in the department and as was agreed in a meeting, he was not offered the benefit of extra compensation as his colleagues who were doing equal work of equal value. The respondent however, as the trial court noted, did not provide a figure, actual or estimate, of how much his colleagues were paid over and above their contracted salaries as compared to his own salary. The whole matter was left to speculation and over reliance on the provisions of section 74 that it was the duty of the appellant to keep employment records. The allegation that his colleagues doing similar work were paid extra from their contractual salaries must have been informed by some iota of evidence, in the absence of which the court had nothing to rely on to believe his story. To this extent, the trial court erred in finding that the respondent was discriminated against. This ground of appeal therefore succeeds. 24.On the issue of separation from employment, the respondent alleged that he resigned out of frustration and intolerable working conditions that made it impossible for him to continue working for the appellant. On the other hand, the appellant’s case before the trial court was that the respondent voluntarily resigned. According to the respondent, his pursuit for payment of what he considered his entitlement as his colleagues, of extra payment for performing the duties of management accountant soiled his relationship with the finance manager and triggered disciplinary action against him. 25.The trial court flagged issues it considered were identified by the respondent as responsible for his involuntary separation from employment hence constituting constructive dismissal. These were:-i.Discrimination at work placeii.Institution of disciplinary hearing based on misplaced allegations and non-performance of duties by line manageriii.Fundamental breach of terms of contract; in the sense of issuance of final warning letter prior to issuance of the two required general warning lettersiv.Compelling the claimant to hand over his duties after the disciplinary duties (sic) without reassignment. When a person is bound to prove the existence of any fact it is said that the burden of proof lies on that person. 26.On these issues the trial court noted that the respondent narrated before the court that his woes began with the realization of unequal payment for taking on work of the outgoing management accountant. He added that the line manager began disregarding his communication on lateness on reasonable grounds such as traffic jam and applications for leave, which resulted in a disciplinary hearing. The respondent added that he was found guilty of absconding work at the hearing and the tribunal recommended that he be issued with a warning letter in line with the terms of his contract. He was however issued with a ‘final warning letter, against which he appealed. The HR office responded to the appeal by stating that the respondent was fortunate not to have been summarily dismissed because of good performance history and that final warning by the appellant was an act of lenience. The Court further noted that there was evidence of the respondent being asked to hand over his duties to other employees with no communication on the reassignment. 27.The Court has carefully considered the findings of the trial court and perused in detail, the record of appeal and agrees with the observations by the trial court. Pages 153 to 229 of the record of appeal, though in certain pages illegible provide active and somewhat heated exchange of correspondence between the respondent and the appellant which was a clear evidence of not a very cordial working relationship. As rightly complained of and noted by the trial magistrate, the HR manual at clauses 6.1 to 6.3 (pages 104-105 of the record of appeal) provided for layers of warning. That is to say verbal warning for offenses that do not warrant written warning, written warning where an employee repeats the infraction for which he was verbally warned and final warning. The disciplinary committee after hearing the respondent, recommended a written warning as opposed to a final warning yet the appellant issued the respondent with a final warning. According to the HR Manual, a final warning was to be issued after a disciplinary inquiry and where it was considered that dismissal would be harsh. There was no record that the respondent had previously been issued with a verbal or written warning. However, there is evidence that the respondent was rated as a good performer and occasionally awarded 13th cheque in appreciation of his good work. Further, the determination of the disciplinary hearing against the respondent also recommended that the issue of working relationship between the respondent and the Finance Manager be addressed conclusively implying there was acknowledgment by the disciplinary committee that there was a problem between the two. It was therefore quite perplexing that the appellant could retort to the respondent’s appeal against what he considered a wrong letter not recommended by the disciplinary committee as lenient. 28.As observed earlier and in several previous cases brought before this court on appeal, its primary role is to re-evaluate, re-assess and reanalyse the extracts on the record and then determine whether the conclusions reached by the learned trial court are to stand or not and give reasons either way. The Court as an appellate court is further reminded not to replace its own opinion of what could have been a better interpretation and ultimate finding on the facts before the trial court if those facts and evidence, align with reasonable conclusions over the issues in dispute and are supported by law. In that respect, the court having considered and reanalysed the evidence before the trial court is of the view that the court aquo did not make an error in reaching the conclusion that the circumstances under which the respondent resigned amounted to constructive dismissal. This ground of appeal therefore fails. 29.Regarding the issue of underpayment, the respondent pleaded and contended that he was employed initially on 2nd February, 2015 at a monthly salary of Kshs. 25,000/-. The contract was subject to a probationary period of three months. This according to the respondent ought to have ended on 2nd May, 2015 yet the confirmation to employment was done on 16th September, 2015. It is the law that probationary contract is extendable for a similar period but with the consent of the employee. Implicit therefore, is that inaction after expiry of the probationary period coupled with continuance in service of the employee, inexorably leads to reasonable conclusion that the employee has been confirmed into service however this does not automatically lead to increase in salary unless the contract specifically provided that salary would be increased to a specific amount upon confirmation. 30.The court has looked at the contract of employment dated 2nd February, 2015 found at page 41 of the record and finds no such provision. Further, the contract issued to the respondent on 16th September, 2015 (page 51 of the record) stated that it superseded all previous contracts. There was no basis therefore in claiming underpayment by the appellant besides, no evidence was presented before the trial court documenting any claim or complaint over the salary earned by the respondent between 2nd May, 2015 when he was supposed to have been confirmed and 16th September, 2015 when he was issued with a new contract. The trial court therefore erred in making this award. This ground of appeal therefore succeeds. The Court has however reviewed and considered the analysis and conclusions reached by the trial court on other heads of claim and found them sound and would not interfere with the findings of the learned magistrate thereon. 31.Concerning the issue of compensation for unfair termination, the trial court seemed to have awarded the respondent the maximum compensation of 12 months’ salary founded only on the reason that the respondent performed well during his tenure however the court ignored to not that the respondent was found guilty of frequently absenting himself from work without authorization and warned. The only problem was the manner in which the appellant handled his disciplinary issue by not hearing his appeal on merit and not investigating the root cause of the not cordial working relationship between himself and the finance manager. Besides the respondent had only worked for the appellant for 7 years. A maximum award of 12 months’ salary was therefore inordinately high. The Court will revise the same to eight months’ using the gross salary of Kshs. 70,000/-. The judgment of the lower court in this respect is therefore revised to Kshs. 560,000/- 32.In conclusion the court in disposing of this appeal, finds and holds as follows:i.The respondent’s resignation was involuntary and constituted constructive dismissal.ii.The respondent did not sufficiently prove that he was discriminated in employment as alleged. The award of the trial court in this regard is therefore set aside and replaced with an order dismissing the same.iii.The award of Kshs. 60,000/- on account of underpayment is hereby set aside and replaced with an order dismissing the same.iv.Eight months’ salary as compensation for unfair termination of employment – Kshs. 560,000v.Item (iv) shall be subject to taxes and statutory deductions but shall attract interest at court rates from the date of this judgment until payment in full. 33.The appeal being partially successful, each party shall bear their own costs of the appeal. 34.It is so ordered. DATED AT NAIROBI THIS 12TH DAY OF JUNE 2026DELIVERED VIRTUALLY THIS 12TH DAY OF JUNE, 2026ABUODHA NELSON JORUMPRESIDING JUDGE-APPEALS DIVISION