While the Kenyan Employment Act 2007 does not explicitly define “constructive dismissal,” it is recognized under Section 45 as a form of unfair termination. Kenyan courts and the Labour Office interpret it based on common law principles and case precedents.
Definition of Constructive Dismissal:
Constructive dismissal, also known as constructive discharge or termination, occurs when an employer creates a hostile or intolerable work environment, leaving the employee with no reasonable alternative but to resign. In such situations, the resignation is not considered voluntary but rather a forced consequence of the employer’s actions or omissions.
Key Legal Interpretations:
Kenyan courts rely on the following interpretations:
- Cambridge University Dictionary: Defines it as “actions taken by an employer that intentionally make working conditions for an employee difficult or unfair so that the employee feels forced to leave their job.”
- Black’s Law Dictionary (9th Edition): Defines it as “A termination of employment brought about by the Employer making the employee’s working conditions so intolerable that the employee feels compelled to leave.”
- Kenyan Case Law (Nathan Ogada Atiagaga versus David Engineering Limited (2015) eKLR): Justice defined it as when “an employee resigns because their employer’s behaviour has become so intolerable or made life so difficult that the employee has no choice but to resign. Since the resignation was not voluntary, it is a termination in effect.”
Why is it Considered Unfair Termination?
Constructive dismissal is the only scenario where an employee who voluntarily resigns can sue their employer for wrongful or unfair termination under Kenyan law. The reasoning is that the employer’s conduct effectively forces the employee out, making the resignation involuntary.
Conditions for Inferring Constructive Dismissal (Godfrey Allan Tolo v Tobias O. Otieno & another [2022] Eklr):
For constructive dismissal to be established, an employee must demonstrate that:
- They resigned within a reasonable time after the employer’s hostile treatment or the creation of intolerable working conditions.
- The resignation was a direct result of the employer’s actions, with or without notice.
- The employer had not explicitly expressed an intention to terminate the employee’s contract.
Examples of Constructive Dismissal in Kenya:
These situations can create intolerable working conditions:
- Unilaterally varying the contract of employment: Changing fundamental terms without the employee’s consent (e.g., significant reduction in pay, demotion without reason).
- Non-payment or delayed payment of salary: Consistent failure to pay wages on time.
- Indefinite suspension without pay: Suspending an employee from work without a clear reason or time limit and without pay.
- Lack of assigned duties: Systematically depriving an employee of meaningful work.
- Overworking employees: Imposing an excessive workload that is detrimental to the employee’s well-being.
- Negative discrimination: Treating an employee unfairly based on protected characteristics like gender, religion, or ethnicity.
- Mistreatment: Engaging in verbal abuse, harassment, or bullying directed at the employee.
- Failure to provide a safe working environment: Ignoring safety concerns, leading to a dangerous workplace.
What Happens When a Constructive Dismissal Suit is Filed?
If a court or the Labour Office finds that constructive dismissal occurred, they can award remedies to the employee, including:
- Compensation: This can include wages the employee would have earned during the notice period they were entitled to, a proportion of wages due for work done before dismissal, and compensation for other losses suffered due to the dismissal (capped at a maximum of twelve months’ gross salary as per Section 49 of the Employment Act 2007).
- Reinstatement: Ordering the employer to take the employee back to their previous job with the same benefits. This is less common due to potential strain in the employer-employee relationship.
- Re-engagement: Ordering the employer to employ the employee in a comparable role at the same wage.
Principles the Court Follows to Ascertain Constructive Dismissal and Award Damages (Coca-Cola East and Central Africa Limited versus Maria Kagai ligaga, (2015) eKLR):
The Court of Appeal in this case outlined key principles:
- Fundamental or essential terms of the contract: What were the core aspects of the employment agreement?
- Repudiatory breach: Did the employer’s conduct fundamentally breach these essential terms, indicating they no longer intended to be bound by the contract? An objective test is applied here – would a reasonable employee consider the breach significant?
- Causal link: Was the employer’s conduct the effective reason for the employee’s resignation? The employee must prove that they left because of the employer’s actions.
- Resignation with or without notice: An employee can resign due to constructive dismissal regardless of the notice period.
- No acceptance or waiver: The employee must not have acted in a way that suggests they accepted the employer’s conduct. Resigning within a reasonable time is crucial.
- Burden of proof: The employee bears the responsibility of proving constructive dismissal.
- Varied facts: The circumstances leading to constructive dismissal can be diverse.
In the Coca-Cola case, the court found that the employer created an intolerable work environment through professional incompetence, leading to constructive dismissal, and awarded the employee nine months’ salary as compensation.
Conclusion and Important Considerations:
While constructive dismissal allows an employee to claim unfair termination after resigning, proving it in court can be challenging. Substantial evidence of the employer’s conduct and its direct link to the resignation is crucial.
If you believe you have a case for constructive dismissal in Kenya, it is generally advisable to resign promptly after the intolerable conduct occurs. Delaying resignation might be interpreted as acceptance of the conditions, weakening your claim. Seeking legal advice from an employment lawyer is highly recommended to assess the strength of your case and understand the necessary steps.
At Ifile Casmir Advocates LLP, we have a depth of skilled litigation lawyers to assist you in this subject.