Kenya Hotels & Allied Workers Union v Shangai Brothers Enterprises Ltd (Oriental Chinese Restaurant & Chinese Chens Kitchen) [2016] KEELRC 145 (KLR)
The bottom line
#A Kisumu court ruled that firing staff for absenteeism without a hearing, or closing a business without following redundancy rules, makes terminations unfair and costly.
What this practically means
#Executive summary
#Key legal issues
#Procedural fairness in dismissal for absenteeism
Jane Nechesa Mwaka was unfairly dismissed because the Respondent admitted terminating her for absenteeism without a hearing
The Respondent closed its case without calling evidence but in submissions admitted Mwaka was terminated for absenteeism without a hearing. The court held that failure to comply with section 41 of the Employment Act rendered the dismissal unprocedural and unfair, notwithstanding the Respondent's reliance on section 44(4)(b) permitting summary dismissal for absenteeism.
Redundancy procedure
The three Grievants terminated on closure of Chen's Kitchen were unprocedurally declared redundant for non-compliance with section 40 of the Employment Act
The Respondent contended the Grievants were terminated due to closure of business. The court found closure of a business amounts to declaration of redundancy, which requires compliance with the procedure in section 40 of the Employment Act. Having failed to follow that procedure, the terminations were unprocedural and unfair, entitling the Grievants to severance pay and compensation.
Quantification of remedies
Compensation was awarded on a month-per-year-of-service basis and underpayments calculated on the difference between statutory/appropriate rates and last salary
The court assessed each Grievant's remedies individually: notice pay, last salary, severance at 15 days per completed year of service, accrued annual leave converted to days of pay, underpayments (making an assumption where records were absent) and compensation equivalent to months of service. The Respondent made no submissions against the claimed figures, and the court entered judgment accordingly.
Legal principles established
#- An employer who dismisses an employee for absenteeism without affording a hearing breaches section 41 of the Employment Act, rendering the dismissal unfair
- Termination of employees following closure of a business constitutes redundancy which must follow the procedure under section 40 of the Employment Act; failure to do so renders it unprocedural
- Admissions in a party's submissions may constitute evidence against that party
Court orders
#- 1.Judgment entered for Jane Mwaka: 1 month's salary in lieu of notice Shs.8,375.45; last salary Shs.8,375.45; annual leave Shs.20,215.40; underpayments Shs.43,874.40; compensation of 3 months' salary Shs.25,126.35 (severance pay denied as she was not declared redundant)
- 2.Judgment entered for Sulman Ocholla Ayoko: notice Shs.8,375.45; last salary Shs.8,375.45; severance pay at 15 days per year for 4 years Shs.16,750.90; annual leave Shs.32,904.70; underpayments Shs.46,505.40; compensation of 4 months' salary Shs.33,501.80
- 3.Judgment entered for Sande George Ochieng: notice Shs.8,375.45; last salary Shs.8,375.45; severance pay at 15 days per year for 2 years Shs.8,375.45; annual leave Shs.14,702.10; underpayments Shs.33,305.40; compensation of 2 months' salary Shs.16,750.90
- 4.Judgment entered for Benson Mogina: notice Shs.8,375.45; one month's salary Shs.8,375.45; severance pay at 15 days for 5 years Shs.26,253.75; compensation of 5 months' salary Shs.41,877.25
- 5.The Respondent shall issue a certificate of service to each of the Grievants
- Jurisdiction invoked
- Reference of a trade dispute to the Employment and Labour Relations Court by a union registered under the Labour Relations Act on behalf of its members (the Grievants)
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Kenya Hotels & Allied Workers Union v Shangai Brothers Enterprises Ltd (Oriental Chinese Restaurant & Chinese Chens Kitchen) [2016] KEELRC 145 (KLR)", Case Analysis (2016). Cause No. 128 of 2013. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2016/145/eng@2016-11-10
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.