Gladys Muthoni Mwangi & 20 Others v Barclays Bank of Kenya Limited & Barclays Africa Group Limited (Petition 25 of 2016) (Civ) [2016] KEELRC 520 (KLR)
The bottom line
#A Kenyan court ruled Barclays' redundancy of 21 employees was unlawful and discriminatory, awarding each worker months of salary plus damages.
What this practically means
#Executive summary
#Questions the Court framed
#The issues the Court set itself to decide, in its own words.
- 1.Who was the employer of the Petitioners?
- 2.Whether the redundancy was justified
- 3.Whether due process was followed in the redundancy
- 4.Whether there is a case of discrimination against the Petitioners
- 5.Whether there are any remedies due to the Petitioners
- 6.Whether the Respondents are entitled to relief on the Cross-Petition
Key legal issues
#Who was the employer of the Petitioners
The 1st Respondent, Barclays Bank of Kenya Limited, was the employer; it deployed its employees with the 2nd Respondent, which benefited from their labours, and both Respondents were properly before the Court
The Court recalled its earlier ruling of 31st March 2016 which found the 1st Respondent to be the employer who deployed its employees with the 2nd Respondent. Both Respondents were necessary parties for effective determination. Employment contracts were with the 1st Respondent, and deployment does not change the principal employer; where the reasons for deployment end, employment continues with the principal.
Whether the redundancy was justified and due process followed
The redundancy was neither justified nor procedurally effected. The notice issued on 14th January 2016 was unprocedural, and the 1st Respondent failed to demonstrate a genuine redundancy situation
The 14th January 2016 notice was issued in the context of the 2nd Respondent's closure decision and was essentially a termination letter, not a redundancy notice from the employer. Section 40 of the Employment Act is mandatory: notices must issue from the employer, and consultations are necessary. The only change was location of the work; the roles and the employer remained unchanged, so there was no genuine redundancy.
Whether there was discrimination on the basis of nationality
Yes. The Respondents failed to produce records to counter sworn averments of differential treatment of Kenyan employees, and the Court found discriminatory treatment contrary to Articles 27 and 41 of the Constitution
The Petitioners adduced uncontroverted evidence of differential treatment in pay, grading and selection for termination as between Kenyan and non-Kenyan employees at the Regional office. The Respondents, who held the workforce records and selection criteria, failed to produce them, so the Petitioners' assertions were justified; failure to justify setting aside employees without reason amounts to discrimination under section 5 of the Employment Act and Article 27.
Whether Petitioners who did not accept redeployment forfeit their redundancy packages
No. Redeployment should have been automatic given the CBA preference provisions; requiring fresh applications was discriminatory and an unfair labour practice, and no Petitioner forfeits terminal dues for having filed the Petition
The CBA gives employees discharged on redundancy preference for re-engagement within 12 months. Subjecting Petitioners to job applications, interviews and conditions for positions already fitting their roles imposed new conditionalities and confirmed bad faith. Section 46(h) of the Employment Act protects employees who initiate proceedings against their employer from dismissal or penalty on that account.
What remedies are due
Ten months' gross salary compensation for unprocedural redundancy, Kshs. 500,000 damages each for discrimination, a CBA-based exit package, continued loan repayment at existing terms, transfer of motor vehicles at book value, and six months' salary as aggravated damages tied to the confidentiality clause
Following Christopher Onyango v Heritage Insurance, compensation of 10 months' gross salary was awarded for unprocedural redundancy. The CBA between the Kenya Bankers Association and BIFU dated 10th September 2015 was applied under section 40(1)(d) for terminal benefits. Constitutional damages for discrimination and aggravated damages for the confidentiality clause restricting employability were also awarded.
Legal principles established
#- A redundancy must be declared by the employer, and where employees are not unionised the employer must personally notify the employee and the labour officer in writing
- Consultations are a necessary procedure in a redundancy so that reasons for, and the extent of, the intended redundancy cannot be left to the employer alone
- An employer relying on section 40 of the Employment Act must justify the redundancy with a genuine, valid and fair reason, failing which the termination is unfair under section 45
- An employee who initiates legal proceedings against the employer cannot be denied terminal dues on that account
- Requiring already-qualified employees to apply afresh for redeployment into positions fitting their existing roles is an unfair labour practice and discriminatory
Court orders
#- 1.Cross-Petition dismissed with costs
- 2.Judgment entered for the Petitioners against the Respondents jointly and severally
- 3.Declaration that the redundancy notice issued on 14th January 2016 was unprocedural and unlawful
- 4.Declaration that the termination of employment of the Petitioners on account of redundancy is not justified and unfair
- 5.Declaration that the unlawful acts of the Respondents amounted to discrimination against the Petitioners
- 6.Each Petitioner awarded 10 months gross salary for unlawful and unfair termination of employment
- 7.Each Petitioner awarded Kshs. 500,000.00 in damages for discrimination
- 8.Petitioners bound by the confidentiality clause for six months and Respondents to pay each 6 months' salary in aggravated damages
- 9.Petitioners with loan balances and facilities to continue repayment at the same terms, rates and interests as at termination on 30th June 2016 without undue disadvantage
- 10.Motor vehicle assets availed as car benefit to be transferred to the respective Petitioners at book value
- 11.Cessation of the employment relationship between the parties on 30th June 2016
- 12.Exit package comprising one month's gross pay as notice pay, severance pay at one month's gross salary for every completed year, payment of accrued leave days, payable bonus for 2016, medical cover extended to 31st December 2016, and a Certificate of Service for each Petitioner
- 13.Petitioners awarded costs
The bench
#One judgment of the whole court — no separate or dissenting opinions.
Wrote the judgment
- Jurisdiction invoked
- Employment and Labour Relations Court jurisdiction over alleged contravention of rights and fundamental freedoms under Articles 27, 41, 47 and related provisions of the Constitution and the Employment Act
Relief refused
#Reliefs under the Banking Act, Capital Markets Act and Competition Act
The Petitioners failed to clearly demonstrate how these statutory protections impacted them and the damage suffered; no evidential content supported those statutes
Respondents' claim for salaries paid past 31st March 2016 and interest thereon under the Cross-Petition
The outcome of the proceedings cannot be blamed on the Petitioners; the Cross-Petition lacked basis and was dismissed
Costs
Petitioners awarded costs; Cross-Petition dismissed with costs.
Quotable passages
#Verbatim from the judgment, each located to the page it appears on in the official PDF — so these can be cited and checked directly.
On the above findings, the Cross-Petition is hereby dismissed with costs; Judgement is hereby entered for the Petitioners against the Respondents jointly and severally
a. the redundancy notice issued to the Petitioners on 14 th January 2016 was unprocedural and unlawful;
i. For unlawful and unfair termination of employment each Petitioner is awarded 10 months gross salary;
ii. For discrimination each Petitioner is awarded 500,000.00 in damages;
g. Noting the above, these shall be cessation of employment relationship between the parties herein on 30th June 2016.
Consultations are therefore a necessary procedure. To give reasons for, and the extent of, the intended redundancy, as of necessity, this cannot be left to the employer alone.
Where employees are not unionised, the employer must issue personal notice to the employees and the Minister.
It is not a genuine redundancy, where the requirements of the business for the affected employees continues, just the same as before and the only change is the location.
Issues in the judgment
#Paragraph numbering repeats; two consecutive paragraphs are numbered 7
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Gladys Muthoni Mwangi & 20 Others v Barclays Bank of Kenya Limited & Barclays Africa Group Limited (Petition 25 of 2016) (Civ) [2016] KEELRC 520 (KLR)", Case Analysis (2016). Petition No. 25 of 2016. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2016/520/eng@2016-06-30
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.