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December 14, 2019 - 08:36
Cyprian Is Nyakundi
Courts News

Nation Media Group Bites The Dust As Sacked Employee Wins In Court

Stephen Gitagama, Nation Media Group Chief Executive Officer (CEO)

The rogue media house owned by the Aga Khan was recently shown dust by an employee they sacked in 2018.

The Case Number 844 of 2018 pitting Edward Ngarega Gacheru against Nation Media Group Limited (NMG) was before the Employment and Labour Relations Court judge Honorable Justice Byram Ongaya, who judged that NMG had erred in sacking Edward and that the media house should pay Kshs. 2.5 million to the claimant.

‘The declaration that parties were in a contract of service governed by the terms and conditions in the letter of appointment dated 15.03.2013 and any deficiencies in the letter supplemented with the minimum terms and conditions of service under the Employment Act, 2007. The respondent to pay the claimant: Kshs. 2, 500,000 in compensation’…’, Stated part of the ruling.

Nation Media Group headquarters on Kimathi Street Nairobi Central Business District

What Happened?

Edward Ngarega Gacheru was employed at NMG in effective May 2013, where he worked as a consultant/casual employee in the sales and marketing department, earning a salary of Kshs, 40,000 per month, till his abrupt dismissal in February 2018.

The sacking letter Edward received read as follows:

Dear Edward,

RE: TERMINATION OF EMPLOYMENT

We refer to your letter of appointment as a freelance Business Executive for the Company.

This is to give you notice of 15 days that the company intends to terminate the Agreement.

The notice shall take effect on the date of this letter and shall expire on 9th February, 2018.

You will be paid your commissions earned for the work done up to 9th February, 2018 but will also be required to off set any liabilities owed to the company as you pursue your clearance.

On behalf of the management of Nation Media Group Limited, I thank you for your contribution to NMG and wish you every success in your future endeavours.

Signed

Michael Ngugi

Group Advertising Director

The judge ruled that Mr. Edward’s rights were violated for instance, he could not enjoy other privileges that permanent staff had enjoyed yet they were doing the same kind of job:

Read below snippets of the judgement:

  1. It was his case and evidence that colleagues he had joined with and undertook the training together but categorised as Permanent Sales Executives who carried out similar duties (of selling advertising spaces) as the claimant were offered better salary and commission and he was left out and discriminated against in that regard.
  2. His evidence was that he reported on duty at 8.00amm to 5.00pm and sometimes worked overtime. Thus, the claimant testified that he was under the respondent’s complete control in terms of working hours, place, appraisal, reporting and paid commissions just like permanent staff but he was without a salary because he was designated a Freelance Sales Executive
  3. Further, the claimant testified that he was deducted PAYE remitted to Kenya Revenue Authority (KRA) and so he considered that he had been enlisted as an employee and not an independent contractor and in which event, withholding tax at 5% would apply and not the PAYE of about 24%. He submitted annual KRA returns on prescribed KRA form P9 as an employee instead of being subjected to withholding tax of 5% with monthly returns.

Court awarded the former NMG staff 2.5 million among other things, to be paid by 1st August, 2019

So, in conclusion judgment is hereby entered for the claimant against the respondent for:

  1. The declaration that parties were in a contract of service governed by the terms and conditions in the letter of appointment dated 15.03.2013 and any deficiencies in the letter supplemented with the minimum terms and conditions of service under the Employment Act, 2007.
  2. The respondent to pay the claimant:

a) Kshs. 2, 500, 000.00 in compensation;

b) half month pay in lieu of outstanding month’s termination notice at the rate of half last full monthly commissions paid to the claimant;

c) 5 months’ pay in service pay or gratuity at the rate of the last full monthly commission paid to the claimant; and

d) 120 leave days and to be paid the same at the rate of 120 divided by 30 days of a month multiply the last gross full monthly commission paid to the claimant.

3. The claimant to compute, file and serve the amount in 2 above within 7 days for recording quantum on appropriate mention date.

4. The respondent to pay the amount in 2 above by 01.08.2019 failing interest to be payable thereon at Court rates from the date of filing the suit.

5. The respondent to pay the claimant’s costs of the suit.

This case serves as an example and has sent shivers down the spine of media house bosses. With the harsh economic times, where most media houses are planning to lay off employees, what is the worst that can happen?

Here is the full 8 paged judgements [link]



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