Skip to content
AI-generated case briefs sourced from Kenya Law · Not legal advice
Caselaw
AI-generated case brief
Case Brief · caselaw.co.ke
ELRCDismissedLabour Court at Mombasa, Claim filed 19th February 2015· [2015] KEELRC 1302 (KLR)

Kenya Plantation & Agricultural Workers Union v Bamburi Cement Limited & another [2015] KEELRC 1302 (KLR)

Employment and Labour Relations Court
23 March 2015
JRJames Rika
2,911 words in judgment
View original judgmentRead on Kenya Law Watch case
AI-assisted case brief
·~12 min to read original · ~4 min brief

The bottom line

#

A Kenyan court ruled that voluntary early retirement offers are not redundancy, so employers may offer them without following Section 40 redundancy procedures.

What this practically means

#

Executive summary

#
The Claimant Union filed a Statement of Claim and an urgent interlocutory application at the Labour Court in Nakuru on 19th February 2015, later transferred to Mombasa, challenging the Respondents' Business Review 2015 which proposed restructuring through Voluntary Early Retirement and outsourcing affecting all 58 unionisable employees of the 2nd Respondent. The Union sought declarations that compelling VER was un-procedural and unfair, and injunctions restraining termination, outsourcing, VER or declaration of redundancy, plus a CPMU audit of the employer's business justifications. The Respondents countered that VER was a voluntary offer not yet accepted, no redundancy had been declared, the 1st Respondent was not party to the CBA, and the Ernst & Young report showed the 2nd Respondent was insolvent. Justice James Rika held that no redundancy had been declared or effectuated; VER is a voluntary, consensual form of termination falling outside Section 40 of the Employment Act 2007; the Respondents had genuinely consulted the Union, which by rushing to court closed the door on consultation; and under the binding Kenya Airways decision the Court cannot substitute its judgment for the employer's business or strategic intent. No prima facie case was shown that the Business Review was a veneer for unfair labour practices. The application was rejected, the parties ordered to resume consultation, the Respondents left at liberty to offer VER, with costs in the cause. The Union retains liberty to restate its case if actual redundancy breaches emerge.

Key legal issues

#
01

Whether redundancy had been declared

Holding

No redundancy had been declared or effectuated; only VER had been floated

Reasoning

The Claimant's pleadings and affidavit asserted un-procedural redundancy but the material before the Court showed only VER and potential redundancy. The Business Review communicated an intention to restructure through VER and outsourcing, not a determination to render positions redundant.

p. 3
02

Whether VER falls under Section 40 of the Employment Act 2007

Holding

No - VER is voluntary, consensual and contractual, not subject to redundancy law

Reasoning

Redundancy is involuntary while VER is voluntary; employees may take it or leave it. VER is not termination initiated by the employer but a consensual termination proposed by the employer, governed by contract terms agreed between offeror and offeree.

p. 4
03

Whether consultation under the Recognition Agreement was breached

Holding

The Respondents engaged the Claimant in consultation; it was the Claimant which failed to exhaust consultation by rushing to court

Reasoning

The Respondents requested and held meetings, the Claimant missed one and never reverted after consulting its economists. Filing suit to stop VER and a redundancy that had not started amounted to rejecting the consultation requirement.

p. 4
04

Whether the Court should interrogate the Business Review 2015

Holding

No - managerial prerogative prevails; the Claimant showed no prima facie case of unfair labour practice

Reasoning

The Kenya Airways decision binds this Court and endorses outsourcing and non-interference with an employer's strategic intent. Ernst & Young reports gave a preliminary view the proposed actions could be justifiable.

p. 5

Legal principles established

#
  • VER is a voluntary consensual termination not regulated by Section 40 of the Employment Act 2007
  • It is not for the Court or Union to substitute the employer's business judgment where the employer believes a redundancy situation exists

Court orders

#
  1. 1.The Application filed by the Claimant on 19th February 2015 is rejected
  2. 2.Parties to resume their consultation from where they left off
  3. 3.The Respondents are otherwise at liberty to offer VER to the concerned Employees
  4. 4.Costs in the Cause

Authorities

#

Legislation

  • Employment Act 2007Section 40
  • Employment Act 2007Section 67
  • ILO Convention 158

Cases cited (1)

  • Kenya Airways Limited v. Aviation & Allied Workers Union of Kenya & 3 others
    [2014] e-KLR, Nairobi Civil Appeal Number 46 of 2013
Jurisdiction invoked
Employment and Labour Relations Court jurisdiction under the Employment Act 2007 and the CBA between the parties

Key timeline

#

Practical implications

#

Frequently asked questions

#

Later judgments citing this (5)

#

Judgments in the corpus that rely on this one. Where the Court said how it treated the authority, that is shown.

Cite this brief

#

Cite this brief

Caselaw, "Kenya Plantation & Agricultural Workers Union v Bamburi Cement Limited & another [2015] KEELRC 1302 (KLR)", Case Analysis (2015). Labour Court at Mombasa, Claim filed 19th February 2015. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2015/1302/eng@2015-03-23

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.