DC345

PAPUA NEW GUINEA
[IN THE DISTRICT COURT OF JUSTICE]

CASE 189 OF 2005

BETWEEN

Juna Katava
Complainant

V

Kenmok Security Services Limited
Defendant

Port Moresby: Gauli, Magistrate
2005: February 10th, March 4th, 24th
2005: April 14th, 22nd

DECISION OF THE COURT

Nature of the Complaint

The complainant claims against the defendant company the sum of K2,010.71 being for the entitlement payment upon him been terminated from his employment from the company.

Facts

The complainant was employed by the defendant company since 1994. He laid of from work in March 2000 due to illness until March 2003 where he resumed again. He was terminated on 12th April 2004. 

The complainant claims one week pay without notice (K75.00), Annual leave for 5 years (K1,285.71) and Pro-rata Long Service 5 years (K650.00) a total of K2,010.71.

The defendant company was incorporated as a registered company on 27th July 2000.

Issues:

1. Whether the complainant was employed by the company since 1994.

2. Whether the period of illness discontinued the complainant’s continuity of services.

3. Whether the complainant was terminated with or without notice.

4. Whether the complainant was paid his entitlement on his termination.

Laws Applicable

The Law applicable is the Employment Act, and the relevant provisions are Sections 33,34,35 and 60.

"33 Termination of Contracts

(1) A contract of service for a specified time or for specified work shall, unless terminated otherwise under this Division, terminate when the period of time for which the contract was made expires, or the work specified in the contract is completed.

(2) A contract of serviced for unspecified period of time shall be deemed to continue until terminated by either party under this Division.

34 Notice of Termination

(1) This section does not apply to written contract of service for the first two years of the operation of the contract unless the parties to the contract agree otherwise.

(2) Subject to this Act, a party to a contract of service may, at anytime, give notice to the other party of his intention to termination the contract.

(3) The length of notice of intention required to terminate a contract of service shall be the same for both parties and-

(a) shall be as specified in the contract; or

(b) shall not be less than the periods specified in Subsection (4.

(4) When there is no provision in a contract of service for notice of intention to terminate, the length of the notice shall be not less than -

(a) one days notice if the employee has been employed for less than four weeks; or

(b) one weeks notice if the employee has been employed for not less than four weeks and for less than one year; or

(c) two weeks notice if the employee has been employed for not less than one year and for less than five years; or

(d) four weeks notice if the employee has been employed for five years or more.

(5) Notice of termination shall be given –

(a) in the case of a contract of service referred to in Section 19(a) – in writing; and

(b) In the case of any other contract of service – either orally or in writing;
and the day on which the notice is given shall be included in the period of notice.

35 Termination of Contract Without Notice

(1) An employee and an employee may mutually agree to terminate a contract of service with or without notice.

(2) Where a party to a contract has given notice of intention to terminate under Section 23, either party may, without waiting for the expiry of that notice terminate that contract by pay to the other party sum equal to the amount of salary that would have accrued to the employee during the period of the notice.

(3) A piece – rate contract of service made under Division 5 may be terminated by either party without notice.

(4) The employment of a casual employee may -

(a) subject to Paragraph (b) – be terminated by either party without notice; and

(b) if terminated by the employer for any reason other than one of the grounds specified in Section 36 (1) – the casual employee shall be paid for a full days work on the day the contract is terminate notwithstanding that he may have worked less than eight hours on that day.

60 Continuity of service

(1) The continuity of service of an employee shall not be affected by –

(a) a transfer of a contract of employment from one employer to another under Section 25; or

(b) the death of the employer; or

(c) sick leave.

(2) A period of absence, due to –

(a) a break in service of not less than three months; or

(b) suspension of a contract of employment under a law in force in Papua New Guinea; or

(c) maternity leave; or

(d) any cause beyond the control of the employee, shall not-

(e) be taken into account in computing the amount of recreation leave due under Section 61 (1); or

(f) be taken into account in calculating the qualifying period of service under Section 61 (4); or

(g) affect continuity of service."

Evidence

The evidence for the complainant comprises of the affidavits of Juna Kaava and witness Jeffrey Kaupa. The complainant Juna Katava in his affidavit dated 3rd March 2005 testified that he was employed by Kenmok Group of Companies from 1994 onwards. That Mr. Kenken Managing Director and proprietor of the Kenmok group of Companies. He did not know or was not aware of the structure and changes in the Companies operation and incorporation of a new security company now know as Kenmok Security Services Limited came into existence as he is uneducated. He reckons he was employed under the same company because he was working under the same person, namely Mr. Kenken who owns the said group of Companies.

Juna Katava attached some documents but not annexed to his affidavit. Those documents includes the following:-

1. A letter from the Department of Labour and Employment dated 25th October 2004 addressed to the Operation Manager of Kenmok Security Services. That letter provided the calculations of the complainant’s entitlement to a total amount of K2,010.71.

2. A letter from the Department of Labour to the defendant Company requesting to provide them information of the complainant’s employment from 1994 to 1999.

3. A letter from the Lusmate Consultancy Services to the Labour Department dated 7th September 2004. It sought instructions from the Department of Labour on the non-payments of the complainant’s entitlements.

The witness Jeffrey Kaupa in his Affidavit undated stated that he joined the Defendant Company as a security guard in the year 2001. Juna Katava joined the company in the year 2002 as a security driver. During his employment he learnt that Juna Katava was a long serving employee. He (J. Katava) was employed as a security dirver by Mr. Kenken the company proprietor. He (Mr. Katava) was driving Mr. Kenken’s 25 seater PMV bus (route 15) before Mr. Kenken incorporated his other business like the Kenmok Security Services and Kenmok Real Estate. Mr. J. Katava was held up at 5 Mile, the criminal took his driving license plus K200.00 cash. The theft of his driving licence affected his work performance and attendance. This resulted him on being terminated in 2002 otherwise he was a quiet but hard worker.

The evidence for the defendant comprises of the affidavits of witnesses Norman Geri and Koi Popna. The witness Norman Geri filed his "Affidavit" on 13th April 2005 and the "Verified Defence" on ith February 2005.

Mr. Norman Geri is the Security Operational Manager (Administration) with Defendant Company. He took up his employment from the 10th of January 2002. He said that the complainant recruited as a driver for the defendant on 27th June 2002 for a six (6) months probational period. His performance was poor so he was terminated before the six months’ probation lapsed. On 27th May 2003 he was re-employed but due to his poor performance he was terminated on the 12th April 2004.

The Complainant sought for his entitlement. HE never worked for 5 years or more to entitle him to any annual leave or pro-rata long service. The Complainant was never in continuous employment with the defendant. The Defendant Company was only incorporated as a company on 27th July2000. The Defendant never commenced the security services nor recruited the complainant from 1994 to 1999.

The witness Koi Popna, a security driver with the defendant company was recruited on 29th January 2001. He confirmed the evidence of Mr. Norman Geri of the complainant’s recruitment, and terminations.

I now turn to discuss the Issues,

Issue 1: Whether the Complainant was employed by the Company since 1994.

The complainant’s evidence shows that he was recruited in 1994 as a driver for the defendant company by its Managing Director and the proprietor Mr Kenken who is still the proprietor and the managing Director to this present time. In some of the documents attached to the complainant’s Affidavit revealed that the complainant was employed by the defendant company from 1994 to December 1999. In December he went on recreational leave for six weeks. He resumed in January 2000 and continued to work until March 2000 when he was laid off due to illness. He could not get back to work until March 2003 when the proprietor Mr. Kenken took him back to continue as a driver. Later he lost his driving licence to the criminals during a hold up at 5 Mile and he could not drive the vehicle. As a result he was terminated.

He was being paid K140.00 a fortnight from 1994 to 1996, then K180.00 a fortnight from 1997 to 1999. He was paid K800.00 his leave entitlement in December 1999. IN March 2003 when he resumed duty again he was paid K150.00 per fortnight until his termination in April 2004.

Witness Jeffrey Kaupa’s evidence is that the complainant joined the company in the year 2002 as a driver. HE was later terminated that same year after he was robbed off his driving licence as he could not be able to drive anymore. Mr Kaupa later learnt that the complainant had been a long time employee. 

The defence evidence from Norman Geri shows that the complainant was recruited on 27th July 2002 but terminated from work due to poor work performance. He was re-employed again on 29th May 2003 until his termination on 12th April 2004 due to poor work performance. The witness Norman Geri was recruited by the defendant company on10th January 2001. He was not aware of the complainant’s with the company from 1994 to January 2000. The proprietor Mr. Kenken has not filed any affidavit to deny or confirm the complainant’s employment from 1994 onwards.

Having considered the evidence I find on the balance of probabilities that the complainant commenced his employment with the defendant company since 1994 until March 2000 when he was laid off due to illness. He was recruited again in July 2002, then laid off few months later then re-employed again in May 2003 until terminated on 12th April 2004.

Issue 2: Whether the period of illness discontinued the complainant’s continuity of service.

The complainant gave evidence that in March 2000 he was laid off work due to illness until March 2003 when he went back to work or being re-employed by the defendant company.

The witness Mr. Norman Geri for the defendant gave evidence that the complainant was recruited on July 2002 but terminated shortly thereafter. HE was re-employed again on 29th may 2003 but terminated again on 12th April 2004. 

There is no medical report to show that the complainant was laid off from work due to his medical health. No affidavit from a eye witness of him been laid off work due to illness, either. The complainant said he was laid off work from March 2000 till March 2003 when he returned to work. The defendant evidence shows he was recruited in July 2002, got terminated few months later that year then re-recruited in March 2003. I am not convinced that the complainant was laid off work because of illness. He may have been terminated due to poor performance at work.

As there been no strong evidence of the complainant, suffering from any form of illness, at any point in which his services were been cut off, there would be no continuity of services.

Issue 3: Whether the complainant was terminated with or without notice

From the evidence as presented before this Court no documents been produced to show that a notice was given to the complainant before proceedings to terminate him. 

Section 34(2) of the Employment Act requires the party intending to terminate the contract to give a notice to the other party of that intention to terminate a contract of service. And the length of time required for the notice to be given are as stated in Section 34(4) of the Act.

In the present case the complainant was in employment with the defendant company for five (5) years or more. He was expected to be given (4) weeks notice. However he was never given the notice before proceeding to termination. Even for the period of his employment from May 2003 to April 2004, a period of about a year’s employment, he would have been given one weeks notice but no notice was given.

Issue 4: Whether the complainant was paid his entitlements on his termination.

The complainant says he says not paid his entitlement as a result he came to this Court for redress. Mr. Norman Geri, the witness for the defendant, said in his Affidavit that the complainant sought his entitlements but because he did not work for 5 years or more he was not entitled annual leave or pro-rate long service leave. This clearly shows that the defendant did not pay him his entitlement. The defendant simply refused to pay entitlements because he is of the view that the complainant did not work for 5 years or more with the company. There is no law or a provision in the Employment Act that requires an employee need to complete 5 years or more of his service before he is entitled to annual leave or pro-rate leave.

The complainant’s evidence is that he commence with the Kenmok group of Companies in 1994. HE continued to work until he took his leave in December 1999 for 6 weeks. He resumed duty in January 2000 and worked until March 2000 when he was laid off due to illness. He says this is the same company that was incorporated later in2000 and currently known as Kenmok Security Services and own by the same proprietor Mr. Kenken.

The defendant company simply denied employing the complainant from 1994 to March 2000. The reason being that the Kenmok Security Services was only incorporated on the 27th July 2000. The defendant company does not dispute or deny that there was a company known as Kenmok group of companies operating from 1994 to July 2000 and that this Kenmok Group of companies and Kenmok Security Services are owned by the same owner namely Mr. Kenken. One of the two things could have taken place here. Either the Kenmok Security Services is one of the Kenmok Group of companies or that the Kenmok group of companies has changed its name and incorporated as Kenmok Security Services.

Where there is a changed of the name of the company but the name of the proprietor (owner) is the same person, an employee employed in the former name of the company who is either transferred to or re-employed to the alter name of the company, that employees entitlement in former name of the company are continued n the alter name of the company provided that these entitlements were not paid before the transfer or re-employment takes place.

I find that the complainant was employed by the Kenmok Group of Companies from 1994 to March 2000. In July 2000 that Company was incorporated as Kenmok Security Services. In July 2002 the defendant re-employed the complainant but was terminated before his six (6) months probation expired. He was re-employed by the defendant in May 2003 then terminated him in April 2004 after working for 12 months. IN all these occasions the complainant was not paid his entitlements. His entitlements as per the calculations given by the Department of Labour and Employment are as follows:-

1.	Money In Lieu of Notices (1 week)	=	K 75.00
	
2.	Annual Leave (5 years)	=	K1,285.00
	
3.	Pro-Rata Long Service Leave (5 years)	=	K 650.00	
			K2,010.71	

I enter judgement for the complainant in the sum of K2,010.71 as his entitlement to be paid by the defendant company plus K40.10 interest on 8% per year pursuant to Section 1 (2) of Judicial Proceedings (Interest on Debts and Damages) Act. The total amount of K2,050.81 be paid forthwith.

Ordered accordingly.

In Person: Complainant
In Person: Complainant