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2 KENYA HUMAN RIGHTS COMMISSION P.O. Box , Nairobi-GPO, Kerya KHRC 2010

3 Introduction. 2 Definition of Terms. 3 What rights does the Employmer 4 What is a contract of service 7 CENTRE term contract or perman tract?2 9 j 2,~ :: thewsayaut dl Does the Employment Act prohibit it What is termination of employment by notice An employer has a duty to... 9 On expiry of notice period, the employee is entitled to... 9 On expiry of notice period, the employee is not entitled to... 9 What happens when employers does not give notice of termination? When can a contract of service be terminated on account of redundancy? An employee declared redundant is entitled to Wh at should happen when an employees contract is terminated What is Summary Dismissal What is unfair termination The employer has to prove Section 46 states that an employee cannot be dismissed because of 14 Is an employee able to seek redress when unfair termination or summary dismissal occurs 7... Can a lawyer represent an employee during proceedings before a Labour Officer? What are the remedies for wrongful dismissal and unfair termination?

4 TermInation Handbook Introduction In 2007, the Ninth Parliament passed into law, five new labour laws that would replace the previous labour regime. The new laws that were enacted were the Employment Act, 2007: the Labour Institutions Act, 2007: the Labour Relations Act, 2007: the Occupational Safety and Health Act, 2007 and the Work Injury Benefits Act, This led to an unprecedented shift in the regulation of labour relations, chief among them the contractual relationship between an employee and employer. The Employment Act provides for the fundamental rights and duties of an employee and the employer. In the conduct of human rights advocacy over sixty (60) per cent of the complaints received at KHRC every month relate to violation of labour rights. One of the major concerns has been the lack of awareness about the existence of labour standards favourable to workers. One of the major complaints that the KHRC receives is on unfair termination which in most cases is effected unprocedurally, with no recourse mechanism for employees to give their version of the event leading to dismissal. This handbook thus seeks to empower workers on the various ways a contract of employment may end and the recourse mechanisms that they can utilise. This Guidebook simplifies the language used in Part VI of the Employment Act, to enable workers especially those in low income employment to better understand their rights in regard to termination as stipulated by law. It is hoped that the networks that the KHRC works with will harness this Guidebook to advise their members on the rights of workers in cases of termination.

5 Terrninaton Handbook Definition of Terms Contract of Service (Employment contract) - an agreement, whether oral or in writing, and whether expressed or implied, to employ or to serve as an employee for a period of time, and includes a contract of apprenticeship and indentured. Casual Employee - a person paid at the end of each day and employed for a period of less than twenty-four (24) hours. Employee - person employed for wages or a salary Employer - person, public body, firm, corporation or company who or which has entered into a contract of service to employ any individual Probationary Contract - a contract of employment for a period less than twelve (12) months. It can be express in writing Redundancy - loss of employment, occupation, job or career by involuntary means through no fault of an employee, involving termination of employment at the initiative of the employer, where the services of an employee are superfluous and the practices commonly known as abolition of office, job or occupation and loss of employment

6 Termination Handbook What rights does the Employment Act confer to Workers? Section 26 to 34 guarantees workers a number of rights. Workers are entitled to: Reasonable hours of work and one day of rest for every seven days At least twenty-one working days of leave for every year worked. Three months maternity leave for a female employee without forfeiting her annual leave Two weeks paternity leave for a male employee Sick leave of not less than seven days with full pay after two every two months of service Reasonable Housing or pay a sufficient sum as rent Clean water Food if agreed upon in the contract of service. Provision of sufficient and proper medical attention Be issued with a certificate of service by the employer on expiry of a contract or on termination- Section 51. This right does not accrue if the employee worked less than four weeks. The certificate should include u The name of the employer and his postal address; La The name of the employee; o The date when employment of the employee commenced; o The nature and usual place of employment of the employee; u The date when the employment of the employee ceased

7 Termination HandkooL What is a contract of service? Every employee has a right to a contract of service. This is guaranteed in sections 7 and 8 of the Employment Act. A contract of service between an employer and employee can either be oral or written. Where a contract is for more than three months, it should be in writing. A written contract should contain: Name, age, permanent address and sex of the employee; Name of the employer; Job description i.e. what employee should do. Date employee should report to work Form and duration of the contract Place or station of work Hoursofwork Salary or wage of the employee, rate and intervals of payment Details of any other benefits Contract should also contain terms and conditions on: Entitlement to leave including public holidays Incapacity to work due to sickness or injury Length of notice which the employee has a duty to give and has right to receive to terminate his contract of employment Any collective agreement, which affect the terms and conditions of employment After termination, the employer should keep the employment contract for a period of five years.

8 Tcrrninaton Hancbook When can a casual employee's contract be converted to a term contract or permanent contract? Under section 37 (1), the law states that a casual contract can be converted where: u A casual employee has worked for a period or a number of continuous working days which amount to the equivalent of not less than one month; or u A casual employee performs work which cannot be reasonably be expected to be completed within a period, or a number of working days amounting to the equivalent of 3 months or more Where can a casual employee raise a dispute with an employer? Under section 37 (5), a casual employee who has a dispute or is aggrieved by treatment of an employer should file a complaint with the nearest District Labour Officer. A casual employee can file a case with the DLO when the employee has not been paid, has experienced sexual harassment and has been a victim of any form of discrimination. The law states that section 88 of the Employment Act will apply when a complaint has filed with the DLO. Section 88 states that a person who commits an offence under the Employment Act or who contravenes or fails to comply with any provisions of the Act for which no penalty is specified will be liable to a fine not exceeding KES 50,000 or to imprisonment for a term not exceeding 3 months or both

9 Termination Handbook What does the law say about discrimination? Section 5 of the Employment Act prohibits any employer from discriminating against an employee or prospective employee it strives to equal opportunities for all persons, in particular: On grounds of race, colour, sex, language, religion, political or other opinion, nationality, ethnic or social origin, disability, pregnancy, mental status or HIV status; In respect of recruitment, training, promotion, terms and conditions of employment, termination of employment or other matters arising out of the employment. Employer shall pay employees equally for equal work. An employee should report the matter to the nearest labour officer or the Industrial court any case of discrimination. If any proceedings occur after a complaint of discrimination has been registered, it is the responsibility of the employer to prove that discrimination did not take place. Does the Employment Act prohibit Sexual Harassment? Section 6 of the Act prohibits sexual harassment in the work place. The law provides a comprehensive definition of sexual harassment. The law posits that sexual harassment occurs when an employer or a representative of the employer: o Directly or indirectly requests an employee for sexual intercourse, sexual contact or any other form of sexual activity that contains an implied or express - Promise of better treatment at work Threat of detrimental treatment in employment

10 Termination Handbook (iii)threat about the present or future employment status of the employee ci Uses language whether written or spoken of sexual nature u Uses visual material of a sexual nature; or o Shows physical behaviour of a sexual nature which directly or indirectly subjects the employee to behaviour that is unwelcome or offensive to that employee and that by its nature has a detrimental effect on that employee's employment, job performance or job satisfaction The law states that every employer who employs 20 or more persons should have a sexual harassment policy. The policy should state - u the disciplinary measures that the employer can use in cases of sexual harassment i how an employee can report a case of sexual harassment ci thatanemployercannotdisclosethenameofthecomplainant expect for the purpose of investigating the claim or when taking disciplinary action What is termination of employment by notice? Section 35 of the Employment Act; discusses termination of employment by notice. A contract of employment should give the length of notice required for the employer or employee to terminate the contract. If the contract does not prescribe the notice period then the Employment Act provides for notice period as follows:

11 Termination HandbooL One-day notice, if the contract is to pay wages daily One-week notice if the contract is to pay wages for a period of less than one month- this includes employees paid after one or two weeks of service, in Kenya it includes employees in the Construction industry and domestic workers. Twenty-eight days notice if contract is to pay wages or salary for intervals on one month or more. An employer has a duty to: Explain the meaning of a termination notice if the employee cannot understand. On expiry of notice period, the employee is entitled to: Service pay for every year worked calculated as fifteen days wage or salary for every year worked. The rate applied is the last wage or salary paid not the wage at the start of employment. Payment for outstanding leave and holidays Salary arrears On expiry of notice period, the employee is not entitled to: Service pay, if contribution is made to the National Social Security Fund (NSSF) or is a member of any pension fund,

12 Termination Handbook gratuity or service pay scheme or other scheme established and operated by the employer. However if the employee is a member of a trade union, payment of service pay or gratuity is dependent on the Collective Bargaining Agreement (CBA). What happens when employers does not give notice of termination? The employee is entitled to a wage or salary for the notice period required (i.e. one day, one week or one month) if the employer does not inform the employee of the intended termination. This is what is referred to as Payment in lieu of notice which is guaranteed in section 36. The penalty curbs the practice by most employers of terminating the contract of service at will. The employee is still entitled to all other dues. On the other hand the employer may waive the notice despite being served with a notice by paying the employee remuneration equivalent to the period of notice, Section 38. When can a contract of service be terminated on account of redundancy? This occurs when the employee indicates to the employee that there is no more work under the contract of service. Redundancy has to be reasonable, fair and just and the employer has a duty to: If the employee is a member of a trade union, to notify the union and the labour officer giving the reasons for and the extent of the redundancy

13 Termination Handbook If employee is not a member of a trade union, notify the employee personally in writing and the labour officer Give due regard to skill, ability and reliability of the employee Apply all terms on terminal benefits on redundancy expressly provided in a collective agreement without undue disadvantage for being or not being a member of the trade union An employee declared redundant is entitled to: Payment for leave due in cash Not less than one month's notice or one month's wages in lieu of notice Severance pay at the rate of not less than fifteen days pay for each completed year of service. What should happen when an employee's contract is terminated? Section 41 (1) states that when an employee's contract is terminated on grounds of misconduct, poor performance or physical incapacity, the employer must explain to the employee, in a language the employee understands, the reason for termination. The employee has the right to have a trade union representative or an employee of their choice present when the employer is explaining the reason for termination. The Act under section 41(2) further states that before termination, the employer should consider and hear any representations which the employee may make and those presented by the person the employee has chosen within subsection 1.

14 Trminaton Handbook What is Summary Dismissal? Summary dismissal takes place when an employer terminates the contract of an employee without notice or with less notice than the employee is entitled to. Any of the matters outlined below can amount to gross misconduct, which can lead to summary dismissal: - u Without leave or other lawful cause, an employee is absent from work place Li Getting intoxicated during working hours u An employee wilfully neglects to perform their work, or if the employee carelessly and improperly performs any work. u An employee uses abusive or insulting language, or behaves in a manner insulting, to the employer or to a person placed in authority over him by the employer; o An employee wilfully fails, or refuses to oblige to a request issued by the employer or any person placed in authority by the employer o If an employee is arrested for any offence punishable by imprisonment and is not within 14 days either released on bail or on bond or is freed u If an employee commits or is suspected to have committed within reasonable and sufficient grounds, a criminal offence against the employer or the employer's property What is unfair termination? The grounds for unfair termination are set out in section 45 of the Act. Section 45 (1) states that no employer should terminate

15 lermination HandbooL a contract of service unfairly. Subsection 2 states that an unfair termination occurs when the employer fails to prove: u That the reason for the termination is valid; j That the reason for the termination is fair. This is related to the employees conduct, capacity or compatibility; or is based on the operational requirements of the employer; and i That the employment was terminated in accordance with fair procedure Subsection 3 guarantees an employee who has been in employment for a period of not less than 13 months before the date of termination, the right to lodge a complaint of unfair term;nation. When handling a case of unfair termination, a Labour Officer, or the Industrial Court should consider the following: - i 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; u The conduct and capability of the employee up to the date of termination; Lj The extent to which the employer has complied with legal provisions regarding termination u Previous practice of the employer in dealing with the type of circumstances which led to the termination; u The existence of any pervious warning letters issued to the employee

16 Terrnnaton Hanibook It is upon the employer to prove the reasons for termination. Employer should serve the employee with warning letters before termination. The employer has to prove: That the reason for termination is valid That the reason for the termination is fair, since it is relates to the employees conduct, capacity, compatibility, or the reason relates to the employee's operational requirements That the employer followed fair procedure and natural justice The employer must at all time act in accordance with justice and equity in terminating the employment of the employee. Section 46 states that an employee cannot be dismissed because of - Pregnancy, for female employee Going on leave or proposing to go for leave Membership or proposed membership to a trade union the participation or proposed participation in the activities of a trade union outside working hours or, with the consent of the employer, within working hours; seeking of office as, or acting or having acted in the capacity of, an officer of a trade union or a workers' representative; Refusal or proposed refusal to join or withdrawal from a trade union;

17 Tcrmnation Handbook Race, colour, tribe, sex, religion, political opinion or affiliation, national extraction, nationality, social origin, marital status, HIV status or disability; Initiation or proposed initiation of a complaint or other legal proceedings against his employer, except where the complaint is shown to be irresponsible and without foundation; or Participation in a lawful strike Is an employee able to seek redress when unfair termination or summary dismissal occurs? In the case of unfair termination or summary dismissal without justification, section 47 (1) states that an employee can lodge a complaint before a Labour Officer within 3 months of the dismissal. In addition to this, the employee under subsection 3 and 4 still has the right to seek redress through the Industrial Court and any other remedies provided for in a CBA. However the burden to prove unfair termination or wrongful dismissal lies with the employee while the burden of justifying the grounds for unfair termination or wrongful dismissal rests on the employer as stipulated in subsection S. Under subsection 2, a Labour Officer presented with such a claim should afford both the employee and employer an opportunity to state their cases and recommend to the parties the best means to solving the dispute.

18 Termination Handbook Can a lawyer represent an employee during proceedings before a Labour Officer? The Act under section 48 states that no advocate can represent an employee during proceedings before a Labour Officer, however an advocate may be present if they are an official of the trade union. What are the remedies for wrongful dismissal and unfair termination? In the case a Labour Officer determines wrongful dismissal or unfair termination, the Labour Officer may as stipulated under section 49 (1) recommend to the employer to pay to the employee any or all of the following: - The wages which the employee would have earned had the employee been given the period of notice to which he was entitled under the Act or contract of service; The wages due for the period of time for which the employee has worked; and any other loss consequent upon the dismissal The equivalent of a number of month's wages or salary not exceeding twelve months based on the gross monthly wage or salary of the employee at the time of dismissal Further to this, subsection 3 states that the Labour Officer may recommend to the employer to: - i Reinstate the employee and treat the employee in all respects as if the employee's employment had not been terminated; or

19 Terniination I ianclbook i Re-engage the employee in work comparable to that in which the employee was employed prior to dismissal, or other reasonably suitable work, at the same wage A Labour Officer shall, in deciding whether to recommend the remedies specified, take into account any or all of the following: - The wishes of the employee; and the circumstances in which the termination took place, i The circumstances that lead to termination including the extent, if any, to which the employee caused or contributed to the termination; i The practicability of recommending reinstatement or reengagement u The common law principle that there should be no order for specific performance in a contract for service except in very exceptional circumstances u The employee's length of service with the employer; u The reasonable expectation of the employee as to the length of service to the employer had the termination not taken place u The opportunities available to the employee for securing comparable or suitable employment with another employer U The value of any severance pay, u The right to press claims or any unpaid wages, expenses or other claims that are owed to the employer U Any expenses incurred by the employee as a consequence of the termination

20 Termination Handbook i Any conduct of the employee which to any extent caused or contributed to the termination u Any failure by the employee to reasonably mitigate the losses attributable to the unjustified termination u Any compensation, including ex-gratia payment, in respect of termination of employment paid by the employer and received by the employee.

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23 1ICe KEN'A HUMAN RIGHTS COMMISSION KENYA HUMAN RIGHTS COMMISSION P.O. Box , Nairobi-GPO, Kenya Tel: (254) /8 Celphone: , Fax: (254) Web: