Poor or unsatisfactory performance as a ground for termination requires more than verbal warnings (Termination Procedures); The Case of Kamuri v Cleanshelf Supermarkets Limited (Cause 922 of 2018) [2025] KEELRC 2278 (KLR)

Legal Brief - Kamuri v Cleanshelf Supermarkets Limited (Cause 922 of 2018) [2025] KEELRC 2278 (KLR)

Brief Facts of the Case

• Kamuri was employed by Cleanshelf from February 2011 until his termination in September 2015 as Head of Bakery Section.
• In August 2015, he was placed on compulsory leave for one month due to alleged unsatisfactory performance. He did not receive his salary for August.
• Upon return (1 Sept 2015), he was verbally informed of his termination; followed by a termination letter dated 1 September 2015 which cited poor performance, multiple complaints about fraud, excessive expiry of bakery goods (due to over-ordering), lack of improvement despite verbal warnings.
• He claims he was never appraised, never given warnings in writing, never given a “show cause” notice, and never given an opportunity to be heard.
• The Respondent claims there were verbal warnings, investigations, a notice to disciplinary hearing (letter dated 24 August 2015), but that Kamuri failed to attend that hearing. Also alleges outstanding Sacco loan, and unreturned company property (a laptop), which were offset from his terminal dues.

Issues for determination:

The Court framed the issues for determination as:

1. Whether the termination of the Claimant’s employment was lawful and fair.
2. Whether the Claimant is entitled to the remedies he sought (i.e. payment of withheld amounts, compensation, leave pay, etc.).
3. Whether the Respondent lawfully offset the Claimant’s terminal dues against his Sacco loan and unreturned company property.

 

The Governing Law / Legal Rules

• Employment Act, 2007 (Kenya), especially:
• Section 41: Requires that before terminating for misconduct, poor performance or physical incapacity, the employer must explain the reason to the employee in a language the employee understands, and allow the employee (or another employee or union rep) to be present during explanation; also the employee must be given opportunity to make representations.
• Section 43: Requires a valid reason for termination.
• Precedents:
• Kenya Science Research International Technical and Allied Workers Union (KSRITAWU) v Stanley Kinyanjui and Magnate Ventures Ltd — standard procedure in poor performance cases: pointing out shortcomings, giving opportunity to improve over reasonable time (2–3 months)
• Jane Samba Mkala v Ol Tukai Lodge Ltd — requirement for objective performance evaluation system as benchmark.
• Njenga & 4 others v Motor Boutique Ltd [2024] KEELRC 2206 (KLR) — concerning deduction or withholding of terminal dues when employee has not expressly consented.

Arguments

Claimant’s Arguments

• No performance appraisal or warning (in writing) had been made before the compulsory leave or termination.
• No notice to show cause, no hearing, no opportunity to be heard. Due process not followed.
• Withheld his salary for the one-month leave (August 2015).
• Entitled to other benefits: accrued leave pay, notice, service pay, house allowance.

Respondent’s Arguments

• Claims performance was unsatisfactory; numerous verbal warnings were given.
• That investigations were done, a disciplinary hearing was scheduled (24 August), but Claimant failed to attend.
• Offsetting of loans or property owed by Claimant from terminal dues. For example, Sacco loan, value of laptop not returned.
• Asserts that compulsory leave period’s salary and notice in lieu were already included in terminal dues.

Court’s Findings / Judgment

• The Court found the termination was unfair and unlawful. Key reasons:
1. Respondent failed to establish a valid reason under Section 43. Though the termination letter cited poor performance etc., there was no evidence of objective performance evaluation, no documented performance improvement plan, no written warnings, no appraisal that would establish performance baseline.
2. Procedure under Section 41 was not followed: no evidence that Claimant was given in writing reasons, no notice to show cause, no hearing, no proof of service of the 24 August letter purportedly summoning disciplinary hearing.
3. Compulsory leave instead of an improvement process indicates lack of intention to support improvement. The court held that sending an employee on compulsory leave for performance reasons without proper performance support is “strange” and inconsistent with fair procedure.
4. On offsetting terminal dues: the court found that there was no express authorization from the Claimant for deductions of his dues to pay off his Sacco loan or unreturned laptop. Also no proof the funds were transferred to Sacco, and thus the deductions were unlawful.
• Remedies awarded:

• 6 months’ salary compensation for unfair termination.
• 1 month’s salary in lieu of notice.
• Salary for August 2015 (month on compulsory leave) since not paid.
• Leave pay for 21 accrued leave days.
• Deductions for unreturned laptop (KSh 54,250) were deducted from the award.
• Total award: KSh 554,750 (after deduction)
• Interest at court rates from date of judgment until payment in full.
• Costs awarded to Claimant.

Legal Significance / Analysis

• Reinforces that poor or unsatisfactory performance as a ground for termination requires more than verbal warnings; needs a structured process (appraisal, notice, opportunity to improve) as per Kenyan law. Employers cannot short-circuit this process.
• Emphasizes procedural fairness in termination cases under the Employment Act: requirement for notice to show cause, a hearing, clarity of reasons, language understood by employee.
• Clarifies that an offset of terminal dues for debts (like loans) or for property must be based on express authorization or agreement; unilateral withholding is unlawful.
• The case underscores the importance of documentation: performance appraisals, warnings, hearing invitations, show-cause notices etc. are critical evidence.

Possible Weaknesses or Counterpoints

• The Respondent claimed some verbal warnings and that there was a disciplinary hearing scheduled; if they had stronger documentary evidence of those, the result might have been different. But in this case, they failed to prove them in court.
• The concept of “reasonable opportunity to improve” may depend on the context; what is reasonable in one job may be different in another. The court in this case considered 2–3 months as a benchmark.

Conclusion / Court’s Holding

The court held in favour of the Claimant. The termination was unlawful and unfair because:

• No valid reason had been shown under section 43.
• Procedural requirements under section 41 were not met.
• The Respondent unlawfully withheld or offset terminal dues (loan, non‑return of property) without express consent or sufficient proof.

Accordingly, the Claimant was awarded multiple remedies (compensation, unpaid salary, leave pay, etc.).