The Employment and Labour Relations Court (ELRC) has ruled that when an employer issues a letter of termination, it must state the reason(s) for terminating an employee's contract.
Justice Agnes Nzei, sitting in Mombasa, ruled that it is this reason or reasons whose validity the employer must prove in any claim arising from the termination of the contract.
“An employer who chooses not to state the reasons for terminating an employee’s contract of employment in the letter of termination cannot be allowed to come up with reasons after a claim is filed by an employee challenging the fairness of his termination,” the judge ruled.
Justice Nzei made the ruling in a case in which she found that the termination of Mr Benson Kagai's employment by Kenga Equatorial Hotels Ltd, trading as Mombasa Continental Resort, was procedurally and substantively unfair.
She awarded Mr Kagai Sh1.2 million, equivalent to five months' salary, as compensation for unfair dismissal.
She added that for fairness to be achieved in the termination of an employee's employment, there must be both procedural and substantive fairness in the manner in which the termination is carried out.
The judge ruled that the hotel had failed to prove that Mr Kagai had been informed of the reasons for the dismissal prior to the termination and in the manner required by law.
“The respondent (hotel) did not demonstrate that the claimant was given an opportunity to be heard before termination of his employment,” ruled Justice Nzei.
She added that the fact that clause 18 of the plaintiff's contract of employment provided that either party could terminate the contract by giving one month's notice or by paying one month's salary in lieu of notice did not mean that the hotel could terminate his employment without just cause.
The judge ruled that the hotel's claim at trial that the claimant had breached clause 5 of his employment contract by committing himself in a purchase order for hotel linen was late and could not be the subject of consideration when it was not an issue at the time of the termination of his employment.
The court also ruled that the hotel's attempt to argue at trial that the claimant had a character flaw that caused frosty relations with his superiors could not be considered "at this point" either, as it was not an issue at the time his employment was terminated and was not stated as a reason in the termination letter.
The court further ruled that the hotel had failed to prove that it acted in accordance with justice and equity in terminating Mr Kagai's employment, as required by Section 45(4)(b) of the Employment Act.
In his claim, Mr Kagai told the court that he was employed as a purchasing manager on September 14, 2021 and that this was the third time the hotel had engaged him after two previous engagements which resulted in unfair dismissal.
He said that on February 22, 2022, the operations manager called him into his office and handed him a termination letter dated February 21, 2022.
The claimant said the letter was signed by two directors and the operations manager and did not explain the reasons for the termination.
For its part, the hotel said that Mr Kagai's claim was fraudulent and intended to tarnish its (the hotel's) good reputation and that he had been lawfully dismissed in accordance with his employment contract and as consented by him at the time of his employment.
