Elisha Kirigha Gezzam Aka Elisha Kiriga Gezzam Mwambi v Brooke Bond Kenya Ltd [2013] KEELRC 783 (KLR)
The bottom line
#What this practically means
#Executive summary
#Key legal issues
#Whether severance pay (redundancy payment) and terminal benefits are separate and distinct entitlements
They are not distinct; severance pay is a species of terminal benefits. The statute uses the term severance pay for payments to an employee declared redundant.
The court found the parties' use of 'redundancy payment' imprecise since the repealed Employment Act used the statutory term 'severance pay'. Terminal benefits was not defined in the repealed Act and is a general term denoting the sum total of all payments made on termination of employment. Severance pay, being a term of art for the specific payment due upon involuntary termination without fault by the employee, falls within terminal benefits generally.
Whether the Claimant established a contractual basis for the claim
No - the Claimant did not place sufficient material before the Court to establish that his claim was based on contract.
Although the Claimant argued the payment of Kshs 1,499,184 was contractual as it resulted from negotiations, neither party produced any policy document or staff manual setting out the agreed redundancy terms, and even the redundancy declaration letter was not produced. Without documentary proof of a contractual entitlement beyond the statutory minimum, the contractual foundation of the claim failed.
Whether the Claimant was entitled to severance pay over and above the Kshs 1,499,184 already paid
No - the correct statutory formula would have yielded Kshs 1,093,155, less than what was actually paid, so the Claimant suffered no loss.
Under section 16A(1)(f) of the repealed Employment Act, severance pay is payable at not less than 15 days' pay per completed year of service. Applying the correct formula (daily rate multiplied by 450 days for 30 years of service), the entitlement would be Kshs 1,093,155, below the Kshs 1,499,184 paid. The Respondent's more generous formula, even if statutorily non-compliant, left the Claimant without prejudice.
Legal principles established
#- Severance pay is a species of terminal benefits; terminal benefits is a general term denoting all payments made to an employee on termination of employment, while severance pay is the specific statutory payment due to an employee declared redundant
- The statutory severance pay rate of not less than 15 days' pay for each completed year of service sets an irreducible minimum
Court orders
#- 1.The Claimant's unfiled 'Statement of Claim' filed on 22 July 2013 without leave of Court is expunged from the records of the Court
- 2.The Cause is dismissed with no order as to costs
- Jurisdiction invoked
- Order of Muya J of the High Court dated 19 February 2013 transferring the file to the Industrial Court, which has exclusive jurisdiction over employment and labour matters
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Elisha Kirigha Gezzam Aka Elisha Kiriga Gezzam Mwambi v Brooke Bond Kenya Ltd [2013] KEELRC 783 (KLR)", Case Analysis (2013). Not stated in judgment (transferred from High Court by order of Muya J dated 19 February 2013). Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2013/783/eng@2013-09-27
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.